Part 1: Principles of Real Estate Flashcards
(149 cards)
1
Q
7 types of real estate industry
A
1) Brokerage
2) Appraisal
3) Property Development
4) Property Management
5) Rental Finding Services
6) Urban Planning
7) Property Inspection
2
Q
Class- Where people live
A
Residential
3
Q
Class- Used for business
A
Commercial
4
Q
Class- Factories and warehouses
A
Industrial
5
Q
Class- Where living things are raised, such as farms and ranches
A
Agricultural
6
Q
Class- churches, schools, and hospitals
A
Special Purpose
7
Q
The location of the property is always the same; it doesn’t move
A
Immobility (physical characteristic)
8
Q
The land itself cannot be completely destroyed or worn out
A
Indestructibility (physical characteristic)
9
Q
Each parcel of real estate is unique, if only due to location
A
Nonhomogeneity (physical characteristic)
10
Q
There is a fixed supply of land which affects the price of that land
A
Scarcity (economic characteristic)
11
Q
Intentional changes to a parcel of land that can either increase or decrease its value
A
Modification (economic characteristic)
12
Q
The actual changes made to a parcel of land, regardless of their impact (eg. landscaping)
A
Improvements
13
Q
Property owners hold onto their investment/property for a long time
A
Permanence of Investment, or “Fixity” (economic characteristic)
14
Q
The site (actual location and surroundings) matter to buyers
A
Area Preference, or “Situs” (economic characteristic)
15
Q
Prices increase (seller’s market) when…
A
a) demand increases
OR
b) supply decreases
16
Q
Prices decrease (buyer’s market) when…
A
a) demand decreases
OR
b) supply increases
17
Q
Segments or layers in any area according to price range or type of property; more demand for one price range than another within one class of real estate
A
Market Segmentation
18
Q
Supply is affected over time by 3 things…
A
1) Supply of construction materials and labor
2) Changes in laws
3) Availability of mortgage money
19
Q
Demand is driven by 4 things…
A
1) Population density
2) Age groups and family sizes
3) Employment and wages
4) Other factors that affect the desirability of an area
20
Q
System of property ownership in the US with all the rights of ownership (as opposed to the feudal system)
A
Allodial System
21
Q
Based on court decisions over many years based on customs and common practices that are considered sensible and fair
A
Common Law
22
Q
Rights of ownership
A
Bundle of Rights
23
Q
Right to occupy the property
A
Right of Possession
24
Q
Right to possess the property without interference
A
Right of Enjoyment
25
Right to dispose of the property (sell or give it to someone)
Right of Disposition
26
Right to use the property (legally) as desired
Right of Control
27
Right to keep others from using the property
Right of Exclusion
28
Bundle of Rights (5)
1) Possession
2) Enjoyment
3) Disposition
4) Control
5) Exclusion
29
Extent of rights to a parcel of land
To center of earth and upwards to infinity, along with naturally growing plants and minerals
30
Rights that may be purchased for walkways, bridges, etc
Air Rights
31
Landowner can sell the land but retain mineral rights
Subsurface Rights
32
Land and anything man-made that has been permanently attached to the land
Real Estate
33
The actual physical real estate plus the bundle of rights
Real Property
34
Any property that is not real property; property that is moveable
Personal Property, or "Chattel" property, or "Personalty"
35
When real property becomes personal property (eg. tree cut down and turned into lumber)
Severance
36
When personal property becomes real property (eg. lumber is used to build a house)
Attachment
37
Cultivated annual crops are personal property called...
Emblements, or Fruits of Industry
38
An object that was once personal property but is now attached (eg. dishwasher, cabinets)
Fixture
39
Fixture used for a business that can be removed if the tenant leaves, although the tenant is responsible for any damages caused by the removal (eg. shelves, signs, counters)
Trade Fixture
40
4 tests the court uses to determine real vs. personal property
1) Agreement of the Parties
2) Intention of the Parties
3) Method of Attachment
4) Adaption of the Item
41
Something in writing
Agreement of the parties
42
Something is clearly labeled as belonging to one of the parties
Intention of the parties
43
Item is attached in a way suggesting permanence (would cause damage is removed)
Method of attachment
44
Item is clearly customized to fit a specific space
Adaption of the item
45
Purpose of police powers
To protect public health and safety
46
Regulate and control the use of the land
Zoning Ordinances
47
5 things that zoning ordinances regulate and control
1) Lot sizes
2) Type/style/appearance of structures
3) Building heights
4) Setbacks
5) Density
48
Distance from the lot line to the building line
Setback
49
of building in an area
Density
50
Determines the purpose(s) for which land can be used
Zoning Classifications
51
4 Zoning Classifications
1) R- Residential
2) C- Commercial
3) I- Industrial
4) A- Agricultural
52
Zoning powers are conferred on municipal governments in this way...
State enabling acts/legislation
53
Automatic local governing zoning powers
Home Rule Powers
54
A new, preplanned area of a city with mixed-use zoning; specific and predetermined portion of a city
Planned Unit Development (PUD)
55
An area between a residential and commercial zone (or any two classifications of zones)- often parks and playgrounds
Buffer Zone
56
If the property existed before zoning rules changed, an exception can be made called...
Nonconforming Use, or "Grandfathered Use"
57
Reducing density in an area; reducing the number of units per building or number of buildings
Downzoning
58
Increasing density in an area
Upzoning
59
When a specific property is rezoned to permit use different from other properties in the area to benefit area residents
Spot Zoning
60
When a property owner appeals to a local zoning appeals board for a variance
Zoning Appeal
61
An exception given by a local zoning appeals board
Variance
62
A special-use permit
Conditional-Use Permit
63
Standards regarding building safety
Building codes
64
Granted for new construction if building complies with zoning laws and building codes
Building permit
65
Given after inspection and required for occupation
Certificate of Occupancy
66
Someone who buys undeveloped land and divides it into smaller lots for sale
Subdivider
67
A map created by a subdivider showing boundaries
Plat
68
Putting housing units on smaller lots to create open space in an area
Clustering
69
Someone who improves the land, constructs buildings, and sells them
Developer
70
Agency that regulates land sales and requires developers to provide buyers with a comprehensive property report with disclosures
Housing and Urban Development (HUD)
71
If given a comprehensive property report, length of time the buyer has to revoke the contract
7 days
72
If not given a comprehensive property report, length of time the buyer has to revoke the contract
2 years
73
Charge on real estate to meet financial needs of the government
Taxation
74
Power of the government to seize private land for public good without the owner's permission
Eminent domain
75
The process of seizing land through eminent domain
Condemnation
76
The process of property owners forcing the government to buy their property because a government project has caused significant loss of value
Inverse Condemndation
77
When a property is reverted to the state and auctioned off due to the owner dying without a will or heir
Escheat
78
Substance that was used as insulation and material for flooring, roofing, etc but was banned in 1978
Asbestos
79
Substance that was used in paint but was banned in 1978
Lead
80
Legislation that requires all prior knowledge of lead/asbestos to be disclosed before a sale
Residential Lead-Based Paint Hazard Act (1978)
81
Exemptions to the Residential Lead-Based Paint Hazard Act focus on...
Homes that house the elderly; children are most at risk from lead poisoning
82
Colorless, odorless, tasteless gas produced by decay of radioactive substances
Radon
83
Substance that can grow anywhere with sufficient moisture
Mold
84
Legislation that allows states to get financing to clean up industrial sites with toxic waste and protects developers from liability
Brownfields Legislation
85
Industrial sites with toxic waste
Brownfield
86
An agreement or circumstance that places restriction of how a property can be used
Encumbrance
87
Makes something easier or better for someone
Easement
88
Type of easement that allows something
Positive easement
89
Type of easement that prevents something
Negative easement
90
Easement that is in effect between properties next to each other where one is landlocked; about the positions of the properties, not the people; belongs to the land and transfers with the title
Appurtenant Easement
91
The property that benefits from an appurtenant easement
Dominant Tenement
92
The property that serves the need of the dominant in an appurtenant easement
Servient Tenement
93
Easement allowing someone to do something necessary
Easement by Necessity
94
Easement that is personal/between people and ends when a party dies or the property is sold
Personal Easement in Gross
95
A temporary agreement to use a property for a specific purpose and time
License to use
96
Most common type of easement given to railroads, utility companies, etc to maintain their equipment
Commercial Easement in Gross
97
When another person's property has been used for 5 or more years, a permanent easement can be given called...
Easement by Prescription, or Prescriptive Easement
98
3 requirements for an Easement by Prescription
1) Uninterrupted, continuous use of the property
2) Use without the owner's consent
3) Use was open, visible, and notorious (the property owner was aware of it)
99
Allows successive owners to use the previous owner's years of use for easement by prescription
Tacking On
100
Unauthorized physical intrusion of some type of real property onto an adjoining property (eg. a fence)
Encroachment
101
Conditions or limitations placed on a property by the owner of the property when transferred to another party- often enforced by 3rd parties like HOA
Deed Restrictions
102
Residential Lead-Based Paint Hazard Act (1978)
1) Applies to property before 1978
2) Buyers have the right of inspection within 10 days
3) Disclosures must be kept for 3 years
103
A lender's claim against a collateral asset which gives the lender the right to sell the home (with a court order) if the borrower fails to repay the loan
Lien
104
The holder of the loan; the lender
Leinor
105
The borrower of the loan
Leinee
106
Classification of lien that refers to a claim against specific property
Specific lien
107
Classification of lien that refers to a claim against all of a person's real and personal property
General lien
108
A general lien resulting from a lawsuit against the owner
Judgment lien
109
A lien created knowingly and voluntarily by an owner
Voluntary lien
110
A lien placed on a property without the owner's consent
Involuntary lien
111
An involuntary lien created by law
Statutory lien
112
An involuntary lien created by the court
Equitable lien
113
If property must be sold to satisfy one or more liens, how are liens prioritized?
1) Real Estate Tax liens and special assessments
| 2) Other liens are prioritized by date/time they were filed with the county
114
When the holder of a lien agrees to move it to a lower priority because it will be to their advantage
Subordination Agreement
115
Assessed value used for real estate taxes
Ad Valorem
116
3 Exemptions from ad valorem taxes
Government, school, and hospital property
117
A factor that is multiplied by the assessed value to raise or lower a community's overall assessed value so it is in line with the entire state
Equalizer
118
Occurs when taxes on a property have not been paid for a period of time specified by law
Tax sale
119
When the owner gets a chance to pay what is owed & retain the property BEFORE it goes to auction
Equitable redemption
120
When the owner gets a chance to pay what is owed & retain the property AFTER it goes to auction
Statutory redemption
121
Taxes for improvements made in a specific area or neighborhood
Special Assessments
122
Protections for contractors when they're not paid for work done or materials supplied
Mechanics lien
123
A notice in the public records that informs if there is a pending lawsuit involving a property
Lis Pendens
124
An exact way to describe the location and boundaries of a real estate property
Legal Descriptions
125
Type of legal description using monuments, degrees, and measurements around the perimeter of a property in a clockwise manner
Metes and Bounds Method
126
North/South lines in Rectangular Survey System
Principal Meridians
127
East/West lines in Rectangular Survey System
Baselines
128
Vertical rows measured from principal meridians
Ranges
129
Horizontal rows measured from baselines
Townships
130
Townships- how many square miles? How many sections?
1) 36 square miles
| 2) 36 sections
131
of acres in a section
640
132
Systematic adjustments to every 4th township line (every 24 miles) to compensate for the curvature of the earth
Correction lines
133
Systematic adjustments to every 4th range line (every 24 miles) to compensate for the curvature of the earth
Guide meridians
134
Sections in a township that are oversized or undersized to adjust for surveying errors
Fractional sections
135
Areas of land that are less than a full quarter section in a fractional section (not owned by the government)
Government lots
136
Used in conjunction with mete and bounds or rectangular survey descriptions that number lots in an urban area
Plat-of-survey method, or "Lot-block-tract method"
137
An official point (a level surface) in every city from which elevations are measured
Datum
138
Bronze markers placed throughout the US indicating elevation
Benchmarks
139
Square miles in a township
36
140
Square miles in a section
1
141
Acres in a section
640
142
Feet in a mile
5,280
143
Rods in a mile
320
144
Square feet in an acre
43,560
145
Square rods in an acre
160
146
Feet in a rod
16 1/2
147
Yards in a rod
5 1/2
148
Feet in a chain
66
149
Rods in a chain
4
