Questions and Answers
What is likely to happen to a claim of ownership if possession was secretive?
declined because possession was secretive.
How is value related to price in the market system?
Value is based on the interaction of underlying economic factors; price is a quantification of value in a transaction.
What is a driveway that extends one foot onto a neighbor's property an example of?
an encroachment.
How is the order of priority among junior liens generally established?
Signup and view all the answers
What do state real estate license laws set in addition to minimal levels of competence?
Signup and view all the answers
What is a key feature of the Torrens System?
Signup and view all the answers
What is an important distinction between a contract for deed and a contract for sale?
Signup and view all the answers
What is an illustration of a risk avoidance procedure that a property manager might take?
Signup and view all the answers
In accordance with the Statute of Frauds, what must a five-year lease have to be enforceable?
Signup and view all the answers
What is an illustration of the legal concept of elective share?
Signup and view all the answers
What can a tenant do if a landlord raises the price of a condominium after an option to buy has been exercised?
Signup and view all the answers
What is an important legal characteristic of an option-to-buy agreement?
Signup and view all the answers
What does proration refer to in the context of a closing?
Signup and view all the answers
What is the term for a home in a neighborhood where homeowners have failed to maintain their properties?
Signup and view all the answers
What happens to an exclusive listing if a property is taken by eminent domain?
Signup and view all the answers
What is the likely effect on real estate prices if demand is increasing but new construction is restricted?
Signup and view all the answers
What must a property owner generally do to qualify for a homestead exemption?
Signup and view all the answers
What is the term for the area running north and south between meridians?
Signup and view all the answers
What is true of a cooperative regarding owner liabilities?
Signup and view all the answers
What is the definition of cash flow in real estate?
Signup and view all the answers
What is the term for the activity when an agent informs families about minority families moving into a neighborhood?
Signup and view all the answers
What does an appraiser do to complete the sales comparison approach?
Signup and view all the answers
When must owner agents disclose their agency relationship?
Signup and view all the answers
What is the primary distinction between real estate and real property?
Signup and view all the answers
Study Notes
Legal Concepts in Real Estate
- A hermit's ownership claim on a 200-acre property after 20 years may be denied due to secretive possession.
- An encroachment occurs when a property feature, like a driveway, crosses onto a neighboring property.
- Contracts for deed allow the seller to retain legal title until the buyer fulfills all terms, differentiating from contracts for sale.
Real Estate Transactions
- Value in the market system arises from economic factors, while price quantifies that value in transactions.
- Estate and property management strategies include risk avoidance, such as closing unsafe areas.
- Proration in closing deals refers to dividing amounts owed or received based on the timeframe of responsibility.
Real Estate Law and Procedures
- Under the Statute of Frauds, leases longer than one year must be written to be enforceable; this includes five-year leases.
- An option-to-buy agreement binds the optionor to complete the sale if the optionee chooses to exercise their option.
- A widow excluded from a will may claim an elective share of the couple's principal residence.
Market Trends and Economic Forces
- Rising demand in real estate, especially during a construction moratorium, typically leads to increasing property prices.
- Incurable economic obsolescence refers to properties in neighborhoods suffering from lack of maintenance by owners.
Agency and Disclosures
- Agents with exclusive listings can have their agreements terminated if the property is taken by eminent domain.
- Owner agents must disclose their agency relationships to potential buyers or tenants upon first substantial contact.
Financial Aspects and Cooperative Housing
- Cash flow is calculated as net operating income minus debt obligations and reserves.
- In a cooperative, members may be responsible for unpaid operating expenses of other residents.
- Tax treatment for principal residences may permit exclusion from capital gains tax under certain conditions.
Property Appraisal
- Appraisers finalize the sales comparison approach by weighing comparable property transactions to establish value.
Ethical Considerations
- The practice of informing residents about demographic changes for potential adverse property value impacts is known as blockbusting.
Geographic Terms
- Geographic areas defined by north-south lines between meridians are referred to as ranges.
Homestead Exemptions
- To qualify for homestead exemptions, property owners must reside on the property they claim.
Studying That Suits You
Use AI to generate personalized quizzes and flashcards to suit your learning preferences.
Description
Test your knowledge with these flashcards focused on key concepts related to property ownership and market values. Each card presents a scenario or question to challenge your understanding of economic principles and legal claims. Ideal for those preparing for the NATIONAL Final Exam.