UNIT 11

Question 1

To whom is a property manager responsible?

Answer 1

A property manager is responsible BOTH to the owner and to the tenants of a property.

Question 2

What is the definition of a resident manager?

Answer 2

A resident manager lives on the property and may be employed by a real estate broker, a managing agent, or an owner, to manage a property on a part-time or full-time basis.

Question 3

What is the difference between a management proposal and a management agreement?

Answer 3

A management proposal is submitted to the owner for review before any formal agreement is made.
The management agreement is the employment contract for a property manager.

Question 4

How do the owner and the property manager arrive at a management fee?

Answer 4

The fee is a negotiated item. It often is a base fee and/or a percentage of the collected rents.

Question 5

What accounting skills are important for a property manager to have?

Answer 5

The manager must understand general accounting principles (GAAP) and be able to prepare and interpret monthly and yearly reports.

Question 6

What is a rent roll?

Answer 6

The rent roll of a property is a list of the number of rental units in a property, the length of each lease (expiration date), and the monthly income for each unit.

Question 7

List three skills needed by office building managers. (See page 15 for other correct answers.)

Answer 7

Analyze the local demographics to attract tenants
Negotiate leases
Develop competitive rent schedules

Question 8

What tasks do managers of condos, coops and PUDs do that are different from other property managers?

Answer 8

To realize the maximum profit on the property that is consistent with the owner’s instructions.

Question 9

What are the three types of budgets that should be established for each project?

Answer 9

Operating budget
Capital reserve budget
Stabilized budget

Question 10

How does preventive maintenance differ from corrective maintenance?

Answer 10

Preventive maintenance is a schedule of planned maintenance actions aimed at the prevention of breakdowns and failures, while corrective maintenance involves the repair or replacement of components which have already failed or broken down.

Question 11

What kind of reports should a property manager be giving to the owner?

Answer 11

Monthly account statements
Delinquent accounts report
Detailed annual statement

Question 12

Property management

Answer 12

Property management can be defined as the administration of rental or other property by a person or a team of people who are acting for the owner.

Question 13

A …………has a dual responsibility—to the owner and to the tenants of a property.

Answer 13

property manager

Question 14

An …… is usually a real estate broker who manages properties for one owner or a number of owners.

Answer 14

individual property manager

Question 15

An ………………usually manages a single large property.

Answer 15

individual building manager

Question 16

A ………. lives on the property.

Answer 16

resident manager

Question 17

A ……………. acts as the property owners’ agent and adviser for the property.

Answer 17

real estate asset manager

Question 18

Before entering into a formal agreement, a property manager will submit a ……….to the property owner.

Answer 18

management proposal

Question 19

The property manager’s first responsibility is to realize the ………. on the property that is consistent with the owner’s instructions.

Answer 19

maximum profit

Question 20

……….. is a schedule of planned maintenance actions aimed at the prevention of breakdowns and failures.

Answer 20

Preventive maintenance

Question 21

………. involves the repair or replacement of components which have failed or broken down.

Answer 21

Corrective maintenance

Question 22

…….involves remodeling, interior redecorating, or new capital improvements.

Answer 22

Construction

Question 23

The property manager must set up and maintain proper records, making regular reports, called ……….., to the owner, that are easily understandable and that cover all operations. A property manager should provide the owner with

Answer 23

property management reports

Question 24

A property manager is responsible to

Answer 24

The property owner and tenants.

Question 25

When demand falls and the vacancy rates rise, the result is

Answer 25

Fierce competition for tenants and reduced rental rates.

Question 26

What is an important task for a manager of a condominium or cooperative?

Answer 26

Physically managing the property

Question 27

A rental space may be unintentionally vacant due to

Answer 27

A high vacancy factor in the area.

Question 28

Which of the following would not be found in a management proposal?

Answer 28

Tenant credit histories

Question 29

When a property manager or management company performs real estate-related tasks (such as collecting rent) for one owner, and that owner is paying the manager a salary,

Answer 29

The property manager is not required to have a real estate license.

Question 30

Which of the following is NOT a valuable skill for a property manager to have?

Answer 30

Mortgage disclosure

Question 31

What is a property manager’s first responsibility to the owner?

Answer 31

Realize maximum profit.

Question 32

Class A office buildings

Answer 32

Are newer buildings and offer prestige to its occupants.