California Real Estate Exam Multiple Choice Questions & ANSWERS(RATED A)
1 view 0 purchase
Course
California Real Estate
Institution
California Real Estate
An appraiser's definition of "Value" would be:
a. present worth of all rights to future benefits arising out of ownership.
b. the ability of one commodity to command other commodities in exchange. c. relationship between the thing desired and the potential purchaser.
d. all of the above. - ANS...
An investor group recently sold a parcel of land for $217,500, which was 45% more than they paid for it.
The land is described as follows: N½ of the NW¼ of the SE¼ of Section 13 plus the W½ of the NE¼ of
Section 13. What was the original price they paid per acre for the property?
a. $1,500
b. $1,200
c. $1,000
, d. $750 - ANSWER a. $1,500
$217,500 ÷ 145% (1.45) = $150,000 original price
Acreage: N½ of the NW¼ of the SE¼ = 20 acres
W½ of the NE¼ = 80 acres
Therefore, price per acre = $150,000 ÷ 100 = $1,500.
Which of the following is NOT a lien?
a. Encumbrance
b. Homestead
c. Zoning
d. All of the above - ANSWER d. All of the above
A lien is a charge against property, whereby the property is made security for payment of the debt, i.e.,
attachment.
A property sells for $121,000. The purchaser gives $10,000 down payment, agrees to place an additional
$5,000 down, and ta ke over an existing VA first loan of $100,000, with the remainder to be in the form
of a 2nd note and trust deed. For these cond itions, how much would the documentary tax stamps be?
a. $1.10
b. $5.50
c. $133.10
d. $23.10 - ANSWER d. $23.10
Do NOT pay on old existing loan being taken over. Therefore, ($121,000 - 100,000) ÷ 1,000 x ($1.10) =
21.0 x $1.10 = $23.10.
, If an appraiser were called upon to evaluate a public building, which had unique and distinctive
architecture, he would employ which of the following methods of valuation?
a. Replacement (cost approach)
b. Comparison
c. Capitalization
d. None of the above - ANSWER a. Replacement (cost approach)
Since there is no income for capitalization and no means for comparing sales, replacement cost is the
only approach available.
The members of the National Association of Real Estate Brokers are called:
a. Realtors®.
b. Consolidated Brokers.
c. Realtists.
d. None of the above. - ANSWER c. Realtists.
If the taxes on a newly acquired property will amount to 1.25% of the purchase price, what will the first
installment (6 months) bill for a home costing $125,500 be?
a. $765.35
b. $742.51
c. $784.38
d. $795.97 - ANSWER c. $784.38
$125,500 x (.0125) ÷ 2 = $784.38.
The best source for establishing the age of a home would be the:
, a. county tax assessor.
b. building and safety department.
c. county recorder's office.
d. either a or b. - ANSWER a. county tax assessor.
The county tax assessor is the best source for establishing the age of a home.
"Gross multiplier" is used to determine value of certain types of income properties. It is determined by:
a. dividing the gross rental income by the appraised value. b. multiplying the market price by the
capitalization rate.
c. dividing the sales price by the gross monthly rental.
d. multiplying the gross monthly rental by a reasonable cap rate. - ANSWER c. dividing the sales price by
the gross monthly rental.
Gross Rent Multiplier is a rough, quick way of converting gross rent into market value.
Which of the following could be used with a purchaser without the immediate involvement of a title
change?
a. Grant deed
b. Land contract
c. Quit claim deed
d. Warranty deed - ANSWER b. Land contract
The land contract does not pass title until some later time, whereby the buyer (vendee) has performed
certain requirements (i.e., accumulate a minimum amount of equity for down payment); title in the
meantime remains with the seller (vendor).
It is preferable to use the replacement cost method of appraisal on new buildings, as opposed to old
buildings, because:
The benefits of buying summaries with Stuvia:
Guaranteed quality through customer reviews
Stuvia customers have reviewed more than 700,000 summaries. This how you know that you are buying the best documents.
Quick and easy check-out
You can quickly pay through credit card or Stuvia-credit for the summaries. There is no membership needed.
Focus on what matters
Your fellow students write the study notes themselves, which is why the documents are always reliable and up-to-date. This ensures you quickly get to the core!
Frequently asked questions
What do I get when I buy this document?
You get a PDF, available immediately after your purchase. The purchased document is accessible anytime, anywhere and indefinitely through your profile.
Satisfaction guarantee: how does it work?
Our satisfaction guarantee ensures that you always find a study document that suits you well. You fill out a form, and our customer service team takes care of the rest.
Who am I buying these notes from?
Stuvia is a marketplace, so you are not buying this document from us, but from seller Olivegrades. Stuvia facilitates payment to the seller.
Will I be stuck with a subscription?
No, you only buy these notes for $12.99. You're not tied to anything after your purchase.
