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Chapter 2 - Introduction to Real Estate questions with answers.
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Chapter 2 - Introduction to Real Estate questions with answers.
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Chapter 2 - Introduction to Real Estatequestions with answers.
A Real Estate Brokerage serves as an ANS -intermediary between buyers and sellers and/or lessees and
lessors of real estate.
A Real Estate Broker is ANS -one who is licensed to represent another person in a real estate transaction
with the intent to receive compensation or valuable consideration.
More specifically, a real estate broker is ANS -a licensed person or legal business entity who, for a fee:
Sells, Lists, Leases, Exchanges, Negotiates, or Otherwise deals in the real estate of others.
Multi-Family Residential Properties ANS -This can be anything from a simple twin-single (or double or
duplex) to a large apartment building. The typical buyer in this category is an investor rather than a
homebuyer. Much more technical knowledge about return on investment, occupancy rates,
maintenance, and other topics relevant to investment properties is required and expected from this
group of buyers.
Condominium ANS -This is a form of joint ownership where the condominium owners own the airspace
within their specific units and use of the common elements in the condominium complex, such as
streets, swimming pools, etc. Condominium associations enforce the bylaws of the development, assess
fees, and arrange for the maintenance of the common areas. Condominiums could be commercial,
retail, or even recreational.
Cooperative ANS -Sometimes referred to as a co-op, is a building that is owned by a nonprofit
corporation formed for that purpose. Co-op residents (cooperators) are shareholders who have a
proprietary lease for a specific unit in the building and the right to use the common elements of the
building. Cooperators generally have the ability to vote whether or not to allow a particular person to
buy into the cooperative, assuming there are no fair housing violations.
Converted-Use Properties ANS -These are existing buildings—such as factories, warehouses, office
buildings, old churches, and schools—that are converted for residential purposes rather than being
destroyed.
, Manufactured Housing ANS -Often erroneously called mobile homes, manufactured housing is a
growing market in many areas. These homes are constructed in the same manner as trailers or mobile
homes, as opposed to conventional on-site construction. They are usually attached to foundations and
considered to be permanent structures.
Timeshares ANS -This is a purchase of an ownership interest in a property (often in a resort area
condominium) for a fixed or variable time period. For example, fifty-two different purchasers buy one
condominium; each agrees to possession for one week per year. Taxes, insurance, maintenance, and
other costs are shared equally.
Commercial Properties ANS -This include offices, stores, hotels, and other buildings. Those dealing in
commercial properties are usually involved not only in sales and other aspects of brokerage, but also in
leasing and leasebacks, property management, and even construction or financing.
Industrial Properties ANS -Land and structures involved in the production, distribution, and storage of
tangible economic goods are usually classified as industrial real estate. The knowledge and skills needed
for industrial real estate overlap with commercial real estate. Typically, a person will specialize in
commercial and industrial properties because there's less demand for only industrial services, and a high
level of experience and expertise is required.
Joe Alpha of ABC Real Estate Corp. has been very successful in buying houses, fixing them up, and
reselling them. He put an advertisement in the local newspaper seeking investors to help him purchase
property and pay for renovations, promising an excellent return on investment when the properties
sold. Do you think that Joe needs a securities broker-dealer license? ANS -No
What is a property managers main job? ANS --Fulfill the goals and objectives of the owners
-Maintain or increase the property's value
-Create income and manage expenditures for the owners
-Reduce the property owner's risk
-Develop and maintain a plan for the maintenance and rehabilitation of the building so it produces the
greatest amount of rental income for as long a period of time as possible.
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