Real Estate Property Terminology

Questions and Answers

To ensure effective communication among employees

Having legal right to use or possess the property

To prevent fraud, waste, and abuse

The organization itself, or the party providing it under a legally binding agreement Signup and view all the answers

Accountability is formal, while responsibility is informal Signup and view all the answers

Taxability at the time of acquisition Signup and view all the answers

Unacceptable levels of stewardship and compliance Signup and view all the answers

To understand the associated financial or regulatory compliance requirements Signup and view all the answers

Delegation of authority Signup and view all the answers

To specify duties and responsibilities Signup and view all the answers

Study Notes

Understanding property terminology is crucial for effective communication and decision-making in property management.
Inconsistently defined or applied terminology can lead to significant challenges and impact communications.

Ownership establishes the legal right to use or possess property.
It involves having legal or rightful title and control over property.
Ownership may change throughout an asset's life and must be clearly identified in the property record.
It affects crucial decisions, including taxability at time of acquisition, use restrictions, and disposition options.
Having legal title to property allows the owner to make all decisions regarding the property.

Accountability does not establish legal or rightful title to property.
It prevents fraud, waste, and abuse by possessing and having use of the property of another.
It includes the obligation to keep records of property.
Lack of accountability is rarely intentional and can be ensured by establishing clear roles and responsibilities.
Key elements of property accountability include specifying the provider, recipient, duties and responsibilities, and penalties in case of default.
Only one accountable person can be assigned to an action.

Responsibility is defined as having the obligation to do something and being answerable to someone or something for doing so.
To effectively assume responsibility, the necessary authority must also be delegated.
Responsibility provides a sense of purpose and sidestepping it may negatively impact results and lead to unacceptable levels of stewardship and compliance.
In property management, responsibility is less formal in meaning and more general in applicability than accountability.
The key distinction is that one is "accountable" to someone for the property, and is "responsible" for certain actions, such as maintenance or storage.