Real Estate Basics Quiz
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Real Estate Basics Quiz

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@ExaltedAwe4618

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Questions and Answers

What does it mean when no two parcels can occupy the same space on the face of the earth?

  • Land can be used simultaneously by multiple owners.
  • Land ownership must be divided equally.
  • Land can be privately owned only.
  • Every parcel has a unique location. (correct)

    • What factor does not directly influence the value of real property?

  • Popularity (correct)
  • Real estate trends
  • Future benefits
  • Location

    • Which term best defines the amount of money used to compensate the seller in a real estate transaction?

  • Price of the property (correct)
  • Value of the property
  • Cost of the property
  • Income from the property

    • What is referred to as a cash-equivalent price in real estate?

    <p>The price reflecting cash payment</p> Signup and view all the answers

    Which statement is incorrect regarding the supply of one-unit residential properties?

    <p>The construction of new homes can decrease existing supply.</p> Signup and view all the answers

    What economic factor is likely to increase the supply of residential properties?

    <p>Decreased mortgage interest rates</p> Signup and view all the answers

    Which of the following describes a potential consequence of changes in local building codes?

    <p>Restricting building types and sizes</p> Signup and view all the answers

    How does police power relate to real estate?

    <p>It ensures compliance with zoning and building laws.</p> Signup and view all the answers

    If a fire station appraised at $2.5 million aligns with the market value, what does it represent?

    <p>Market value</p> Signup and view all the answers

    What is investment value best defined as?

    <p>The value of a property to a specific buyer with specific investment criteria</p> Signup and view all the answers

    What statement best describes market value?

    <p>An estimate of a price that would have been negotiated for a sale</p> Signup and view all the answers

    Which of the following best characterizes market capitalization rate?

    <p>The typical rate for this type of investment</p> Signup and view all the answers

    If the market capitalization rate is 10% and Dennis's overall capitalization rate is 12%, what can we infer?

    <p>Dennis has specific, higher investment expectations</p> Signup and view all the answers

    Which of these is NOT a factor that influences market value?

    <p>Seller's financial situation</p> Signup and view all the answers

    Which type of value relies heavily on a property's use in economic terms?

    <p>Use value</p> Signup and view all the answers

    How are similar-sized commercial buildings appraised in terms of market value?

    <p>They are considered in relation to their selling price and comparables</p> Signup and view all the answers

    What does PITI stand for in mortgage calculations?

    <p>Principal, Interest, Taxes, and Insurance</p> Signup and view all the answers

    Which of the following best describes macro-level data?

    <p>Influences that derive from social, economic, governmental, and environmental forces</p> Signup and view all the answers

    Which type of household description includes all persons, related or unrelated, occupying a housing unit?

    <p>All persons, related or unrelated, who occupy one housing unit</p> Signup and view all the answers

    For mortgage approval, what should be considered when comparing buyers’ income?

    <p>Buyers’ income and the required payment including taxes and insurance</p> Signup and view all the answers

    Which factor is significant for a property to be valued over $100,000 in the market?

    <p>Recognition of the extra area by the market as adding more value</p> Signup and view all the answers

    What is NOT included in any calculation or consideration in the mortgage approval process?

    <p>Non-market standard elements</p> Signup and view all the answers

    How is household data best categorized in appraisal contexts?

    <p>As collective data of individuals related to housing units</p> Signup and view all the answers

    If a new factory opens and hires several hundred new employees, how does this impact property valuation?

    <p>It increases demand for housing, potentially increasing property values</p> Signup and view all the answers

    What is the mortgage amount after putting down 20% on a one-unit home priced at $200,000?

    <p>$160,000</p> Signup and view all the answers

    How much do the points cost when purchasing a one-unit home for $200,000 with a 25% down payment and a charge of three points?

    <p>$4,500</p> Signup and view all the answers

    What is the equity you have if your first mortgage is $150,000 and your second mortgage is $70,000 on a property valued at $200,000?

    <p>$50,000</p> Signup and view all the answers

    Which institution has historically dominated the secondary mortgage market?

    <p>Fannie Mae</p> Signup and view all the answers

    What is the primary purpose of a mortgage document?

    <p>Document that makes a borrower promise to repay money</p> Signup and view all the answers

    If a mortgage has a 5% annual interest rate with quarterly payments, what would the effective interest rate be?

    <p>1.25% per quarter</p> Signup and view all the answers

    What does the secondary mortgage market encompass?

    <p>Market for the trading of mortgage-backed securities</p> Signup and view all the answers

    Which of the following is NOT a feature of a mortgage?

    <p>Share of stock in a company</p> Signup and view all the answers

    Which of the following is considered a type of neighborhood characterized by one predominant land use?

    <p>Single-use district</p> Signup and view all the answers

    What term describes the various complementary land uses found in a region?

    <p>Complementary development</p> Signup and view all the answers

    Which factor is NOT typically considered when assessing changes in property use?

    <p>Neighborhood demographics</p> Signup and view all the answers

    In real estate appraisal, which of the following can indicate signs of neighborhood decline?

    <p>Increase in crime rates</p> Signup and view all the answers

    Which type of area is defined as the geographic location from which a retail center draws its customers?

    <p>Market area</p> Signup and view all the answers

    Which of the following best describes construction cost increases?

    <p>Rising material costs</p> Signup and view all the answers

    What is the term used for the ongoing process of areas experiencing revitalization?

    <p>Gentrification</p> Signup and view all the answers

    Which would NOT indicate a stable neighborhood?

    <p>High rates of new construction</p> Signup and view all the answers

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