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Chapter 7: Property Management Questions And Answers With Verified Solutions 100% Correct!!!
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Chapter 7: Property Management Questions And Answers With Verified Solutions 100% Correct!!!
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Chapter 7: Property ManagementQuestions And Answers With Verified
Solutions 100% Correct!!!
Property Manager - ANSWER✔✔ An employee or general agent of an owner's
investment property that has a real estate license, and management agreement
Ongoing reports (usually monthly) of property condition, finances, maintenance
reports, etc.
Must keep on top of local rental rates and stay aware of any state / federal laws that
affect property management (like Fair Housing Laws)
What is a property manager's goal? - ANSWER✔✔ To achieve the owner /
landlord's objectives (to maximize income) while preserving the value of the asset
(the property)
Management Agreement - ANSWER✔✔ A property manager's employment
contract which will define the expected tasks and responsibilities like maintaining
positive tenant relationship, retaining existing tenants, lease administration, etc.
TAR has one that many use
Creates an agency / fiduciary relationship (owes LL OLDCAR duties)
Cash Flow Report - ANSWER✔✔ A list of all cash that was received and all
expenses paid out during a reporting period
Operating Statement - ANSWER✔✔ Compares each category of income and
expense to a prior period's report so that trends can be identified
Changes to Property Management stem from: - ANSWER✔✔ 1) Growth in the
number of commercial properties
2) Size of properties
3) Growing complexity of commercial properties
4) Green revolution (LEED certified buildings need specially trained property
managers)
5) Growth of a global marketplace (foreign / local investors)
6) Legal Issues (complex legal environments demand highly trained property
managers with errors and omissions insurance to protect themselves
, Things to consider when deciding to hire a professional management company: -
ANSWER✔✔ 1) Location of investment property may not be convenient and large
properties with more units and square footage are time consuming
2) Knowledge of Landlord-Tenant law would be superior and they could maintain
tenant relations, acting as a buffer between LL and tenant
5) Cost of management fees is negotiated but they can also enhance a property's
profitability
7) Employment responsibilities of manager would include maintaining the property
so LL would avoid and manager would assume liability
8) Marketing from a professional manager with a larger network
Property Manager Roles: - ANSWER✔✔ Effective marketer, accountant, market
analyst, psychologist, mediator, maintenance engineer, technology specialist, triage
expert, community activist, and enforcer
Types of Property Management - ANSWER✔✔ Two types with their own
subcategories: Residential property management & commercial / industrial
property management
Residential Property Management - ANSWER✔✔ Manage all properties form
single-family homes (used as rentals) to large apartment communities
Multifamily housing (duplexes, etc.), apartments, condominiums and cooperatives
(condo owners employ people and coop owners own stock in the company that
hires PMs to maintain / follow BOD's rules and policies for property), planned unit
developments, subsidized housing, elderly housing, student housing, vacation
rentals and manufactured-home parks
Condominium vs. Cooperative Property Managers - ANSWER✔✔ Condo owners
employ property managers to preserve their properties' values
Co-op owners own stock in a company that hires PMs to maintain the property and
implement / enforce the BOD's rules and policies
Planned Unit Development Property Managers - ANSWER✔✔ Maintain the
community's property value by enforcing the HOA's restrictions, collecting HOA
dues, and maintaining the common areas and landscaping
The homeowners own their lots and pay the HOA to cover the maintenance of the
common areas adn the PUD's operating costs
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