Chap 14
Because mobile homes are considered to be personal property, the method of encumbering the ownership is through what??
a security agreement instead of a deed of trust.
Define condominium
a system of individual fee ownership of a unit in a multifamily structure combined with joint ownership of common areas of the structure and the land.
Define appreciation
an increase in value when demand exceeds supply.
Five major factors determine investment potential. They are:
risk, liquidity, management, tax aspects, and appreciation potential.
Describe the one-story construction style
simplest to build and the easiest to maintain, but it occupies more land per square foot of living space than the other styles.
The rental operation of a mobile home park is within the jurisdiction of:
the State Department of Housing and Community Development.
What does Liquidity refer to
the ability to convert your investment to cash quickly.
What does management refer to
the cost and time involved in overseeing the investment.
A mobile or manufactured home is defined by the California Health and Safety Code as:
''a vehicle designed and equipped to contain not more than two dwelling units, to be used without permanent foundation.''
The Mobile Home Parks Act defines a mobile home park as:
''any area or tract of land where one or more mobile home lots are rented or leased.''
Under the Business and Professions Code, real estate licensees may have their licenses suspended or revoked if they are found guilty of any of the following 4 situations:
1. Failed to provide for the delivery of proper certificate of ownership of a mobile home 2. Knowingly participated in the purchase or sale of a stolen mobile home 3. Submitted a check, draft, or money order to the state for payment of mobile home fees and the draft is dishonored upon presentation to the bank
The Civil Code provides for the termination of tenancy by the landlord of a mobile home park tenant when any of these 5 situations occur:
1. Failure to comply with local ordinances and state laws and regulations related to mobile homes 2. Conduct that constitutes a substantial annoyance to other tenants 3. Failure of the tenant to comply with reasonable rules and regulations 4. Nonpayment of rent, utility charges, or incidental service charges 5. Failure to maintain the mobile home in a reasonable state of repair acceptable to park management
Name the 8 major roof styles
1. Gable Roof 2. Victorian Roof 3. Hip Roof-All sides slope to eaves 4. Shed Roof 5. Gambrel Roof-Found on barns and Dutch colonial homes 6. Gable Roof-with shed dormer 7. Pyramid Roof-All sides slope from one point (no ridge line) 8. Mansard Roof-(French style)
What 4 things should be checked When Buying aCondominium
1. If the building is new, check reputation of the builder. If it is an existing building, check with agents, neighbors, etc. to see if there have been complaints regarding quality of construction. 2. Read all legal documents carefully 3. know the amount and coverage of any homeowners' association fees. 4. Ask yourself these specific questions: a. Is exterior and/or interior maintenance included in fees? b. Are there any restrictions on sale/lease of units? How many units are tenant occupied, as opposed to owner occupied? c. Are there any warranties on equipment? d. Does the developer and/or the association have reserve funds in case of an emergency? e. Are owners required to pay maintenance costs for unsold units? f. Is there enough insurance to protect against fire, liability, theft, and other risks? 5. What experience has the real estate agent had regarding the sale and financing of condominiums?
List the 5 Disadvantages of Mobile Home Ownership
1. Mobile homes can depreciate rapidly. 2. Mobile homes usually have a lower resale value 3. The terms of loans offered by lenders are usually not as favorable 4. When a mobile home is located in a mobile home park, the owner may be required to buy extras, such as steps with handrails or skirting to conceal wheels. 5. sites may be difficult to obtain.
Name the 16 Architectural Styles
1. New England Colonial-A box-shaped two-story house with a center entrance, wood siding, and shutters 2. Georgian Colonial-A brick two-story house with a center entrance and a hip roof 3. Southern Colonial-A two-story house with pillars and shutters. 4. Dutch Colonial-A two-story house with a gambrel roof. 5. California Bungalow-A small one-story house with a low-pitched roof 6. California Ranch-A one-story house with a low-pitched roof and a sprawling floor plan 7. Spanish-A house with a tile roof and arches 8. Cape Cod-A house with a second story above the eaves, a high pitched roof, wood siding, and a large chimney 9. French Provincial-A formal house with a high-pitched slate hip roof, a stone or brick exterior, and shutters 10. Victorian-A house with ornate gables 11. English Elizabethan- A house with a high pitched slate roof, rough half-timbers, and a plaster exterior 12. Monterey- A two-story house with a front balcony 13. French Norman- A house with a tower as the main entrance and a steep roof 14. English Tudor-A house with a high-pitched slate roof, a cathedral-like entrance, and a masonry exterior 15. Mediterranean or Italian-A house with a tile roof, a stucco exterior, and rounded decorative work above the windows 16. Contemporary A house of modern design
Legal Requirements Related to Mobile Homes:
1. New mobile homes can only be sold through mobile home dealers licensed by the Department of Housing and Community Development. 2. A real estate licensee can sell used mobile homes provided the mobile homes have already been registered with the state and are on a lot or in a mobile home park. 3. The mobile home must be capable of being transported over a road. The hitch must be attached to the unit or stored underneath, and the axles must still be attached to the frame. 4. The licensee is responsible to see that there is proper completion and delivery of the title to the buyer. 5. Notification of transfer of ownership must be made within 10 days of the sale date. 6. All fees must be paid to the state within 10 days of the sale date. 7. No concealment of a material fact or any other fraudulent act may be committed. 8. Mobile homeowners must pay an In Lieu Tax similar to regular property taxes paid by homeowners. 9. If the mobile home was manufactured after June 15, 1976, it must have a Department of Housing and Urban Development (HUD) tag, guaranteeing its proper construction.
What are the 8 Advantages of Condominium Ownership
1. Owners can sell their units 2. Insurance companies offer special packages 3. It combines the benefits of owning a house with the advantages of apartment living. 4. Owners receive the same income tax benefits as homeowners. 5. Owners build equity with each payment 6. There is little or no yard work to perform. 7. Common areas that are part of ownership can include game rooms, swimming pools, tennis courts, and putting greens. 8. The law offers some protection to owners, in that they cannot be made to leave because of certain infractions of by-laws and regulations of the governing owners' association.
List the 4 basic types of mobile homes
1. Single, 8-foot, and 10-foot-wide units 2. Single, 12-foot-wide units 3. Multiple-wide, double-wide, or triple-wide units 4. Quads—four units together
List the 7 Advantages of Mobile Home Ownership
1. The price of traditional homes has risen so rapidly that many families, young adults, and senior citizens are purchasing mobile homes 2. Mobile home parks are relatively quiet 3. Residents feel secure because there is usually only one entrance/exit to the mobile home and most residents know the other owners 4. Mobile homes are transportable. 5. The quality and amenities of mobile homes have improved 6. Better financing terms are now available 7. There is minimal yard maintenance or none at all.
What are the 4 Disadvantages of Condominium Ownership
1. owner is responsible for all building maintenance problems in his or her unit. 2. Owners may be required to pay their share of the association fees to cover maintenance costs in common areas even if they disagree with the expenditure. 3. Sometimes the developer controls parking and recreation areas, for which he or she may charge extra fees. 4. Owners may find themselves living rather compactly in close proximity to neighbors. Noises emanating from swimming pool and game areas may be distracting.
What 4 conditions must be met when Converting a Mobile Home to Real Property??
1. owner must obtain a building permit. 2. mobile home must be placed on a permanent foundation. 3. mobile home owner must obtain a certificate of occupancy. 4. A document stating that the mobile home is attached to a permanent foundation must be recorded.
When is a mobile home lot considered a subdivision??
If it has 5 or more lots for rent or lease
Can a real estate licensee sell a new modular unit from the factory or off a sales lot??
No. Not until the modular home is set in place
Are Owners of second homes allowed to deduct the interest on loans and payment of property taxes.
Yes *If a second home is sold for a gain, homeowners are not allowed to use the $250,000 for singles and $500,000 for married couples income tax exclusions
Define Modular homes
a factory-built home, without wheels, that is intended from the beginning to be placed on a permanent foundation.
Describe the 2-story construction style
lower cost per square foot because a single foundation and roof support two floors of living area
What are the 3 most used construction style of homes
one-story, split-level, and two-story homes
Describe the split-level construction style
popular in California because of the better utilization of land of varying topography as well as the pleasing cosmetic effect. However, it is usually more expensive to build
What does tax aspects refer to
the income tax laws and their impact on the investment.
Define Risk
the possibility that you will lose all or part of your initial investment.
What is the major difference between mobile homes and a trailer
trailers usually provide temporary housing only, whereas a mobile home is a permanent living unit