quiz 1 real estate

30. A rancher owns a parcel of land with all subsurface, air, and water rights intact. If oil is discovered on the parcel of land, who owns the oil? a. The rancher b. The tenant farmer to whom the property has been leased c. The state government d. The federal government

a. The rancher

12. A North Carolina beachfront property owner owns the land on the ocean side of the property to the a. average high tide line b. average low tide line c. international waters line d. the center of the body of water

a. average high tide line

26. Debts that are incurred by an individual and become liens against any real or personal property owned by that person are a. general liens b. specific liens c. fiduciary encumbrances d. special assessments

a. general liens

32. The phrase "bundle of legal rights" a. is part of the definition of real property b. is another name for legal description c. refers to the legal documents used in real estate transactions d. refers to the tenant's rights in a lease

a. is part of the definition of real property

Which of the following factors would affect demand the most? a. population b. construction costs c. government controls d. the labor force

a. population

29. When the supply of available housing decreases, a. prices tend to rise b. prices tend to drop c. demand tends to drop d. there is no effect on the housing market

a. prices tend to rise

5. Real property can become personal property by a. severance b. purchase c. hypothecation d. annexation

a. severance

16. A property held as tenancy by the entirety in North Carolina requires that a. the co-owners must be a married couple b. the property in question must be residential property c. upon the death of a co-tenant, the decedent's interest passes to the heirs d. in the event of a divorce, the property will escheat

a. the co-owners must be a married couple

13. Which of the following liens is NOT required to be recorded in order to be valid? a. Mortgage lien b. Ad valorem property tax lien c. Judgment lien d. Mechanic's lien

b. Ad valorem property tax lien

31. A homeowner objected when a local utility company dug up his garden to install a natural gas line. The company claimed it had a valid easement supported by the county records. The homeowner claimed the easement was not valid because he was unaware of its existence. The easement was a. a valid easement in gross even though the owner did not know about it b. a valid appurtenant easement owned by the utility company c. not valid because the owner did not authorize the easement d. not valid because the owner was not informed of its existence when he purchased the property

b. a valid appurtenant easement owned by the utility company

21. The developer grants the power company the right to install transmission lines throughout the subdivision. This right is called a. a license b. an easement in gross c. an easement by prescription d. a conditional use permit

b. an easement in gross

34. The owner of a house wants to fence the yard for a dog. When the fence is erected, the fencing materials are converted to real estate by a. severance. b. annexation. c. immobility. d. indestructibility.

b. annexation.

3. An important characteristic of land is that it may be modified or improved at any given time. Depending on its type, an improvement may increase the value of real estate greatly. Which of the following would be considered an improvement "on" the land? a. sewers b. buildings c. sidewalks d. roads

b. buildings

9. A person who has complete control over a parcel of real estate is said to own a a. leasehold estate b. fee simple absolute estate c. life estate d. defeasible fee estate

b. fee simple absolute estate

8. Which of the following is not a test for determining whether an item is a fixture? a. intent of the parties b. size of the item c. method of attachment of the item d. adaptation of the item to the real estate

b. size of the item

35. The North Carolina owner of a secluded area adjacent to the Atlantic Ocean noticed that people from town walked along the shore in front of this property. The owner learned that the local citizens had been walking along this beach for years. The owner went to court to try to stop people from walking along the water's edge in front of the property. The owner is likely to be a. unsuccessful, because the local citizens have been doing this for years and thus have an easement b. unsuccessful, because the owner's property extends only to the high-water mark and the public can use the land beyond this point c. successful, because the owner's property extends to the middle of the water bed d. successful, because the owner can control access to his own property

b. unsuccessful, because the owner's property extends only to the high-water mark and the public can use the land beyond this point

20. Which of the following statements about the North Carolina Timeshare Act is true? a. Use of a two-bedroom unit for one-week for a 3-year period would meet the definition of a timeshare b. A timeshare salesperson can be fined by the North Carolina Real Estate Commission for violations of the Act (Developer can be fined not salesperson) c. A purchaser of a new timeshare ownership must be given a 5-day rescission period d. An active North Carolina real estate license is not required to sell timeshares to the public

c. A purchaser of a new timeshare ownership must be given a 5-day rescission period

25. Which of the following liens holds first priority regardless of when it was recorded? a. Mortgage lien b. Mechanic's lien c. Ad valorem tax lien d. Federal income tax lien

c. Ad valorem tax lien

17. A buyer purchases an individual unit in severalty and has an undivided interest in the common elements of the entire complex. What form of ownership does the buyer hold? a. Planned unit development b. Cooperative c. Condominium d. Timeshare

c. Condominium

28. The North Carolina Commercial Real Estate Broker Lien a. allows a commercial client to sue a broker for breaching fiduciary duties b. gives a buyer's agent the right to sue the commercial listing agent for compensation c. allows a lien to be placed on a commercial property to secure the broker's commission d. requires a commercial broker to place a lien on the listed property at the time of the listing

c. allows a lien to be placed on a commercial property to secure the broker's commission

7. A business owner rents an empty building to use as an ice cream parlor. The tenant subsequently installs large freezer units and several service counters. These additions a. are considered permanent improvements to the property b. became the landlord's property once attached to the building c. can be legally removed by the tenant at the termination of the lease d. can only be removed by the tenant with the landlord's permission

c. can be legally removed by the tenant at the termination of the lease

27. The North Carolina Mechanic's Lien law a. applies to all residential construction projects over $30,000 b. only applies to commercial construction projects over $30,000 c. does not apply to construction projects costing over $30,000 on owner-occupied dwellings d. applies to commercial and residential construction projects under $30,000

c. does not apply to construction projects costing over $30,000 on owner-occupied dwellings

11. A portion of a building was built on the neighbor's land. This is called an a. accretion b. avulsion c. encroachment d. easement

c. encroachment

33. A recent patio addition extends one foot over the property line onto the lot next door. This best describes an a. easement b. encumbrance c. encroachment d. entitlement

c. encroachment

10. A woman wishes to donate a vacant lot that she owns to a hospital that is located next to her lot. An attorney prepares a deed that conveys the ownership of the lot to the hospital "as long as it is used for medical purposes." Upon transfer, the hospital will hold a a. pur autre vie estate b. fee simple absolute estate c. fee simple determinable estate d. fee simple to a condition subsequent estate

c. fee simple determinable estate

4. Which of the following is generally considered real property? a. Trade fixtures b. Annual crops planted by a tenant farmer c. A shrub planted in a decorative pot d. A shrub planted in the backyard

d. A shrub planted in the backyard

6. A seller is under contract to sell a property using the standard NC Offer to Purchase and Contract. The elegantly decorated master bedroom has vertical window blinds, hand painted light switches and electrical outlet covers, and draperies fashioned from fabric coordinated with the wallpaper. Which of the following items may the seller legally remove before the close of the transaction? a. The blinds b. The draperies and drapery rods c. The hand-painted items d. The draperies

d. The draperies

22. When a company furnishes building materials for a house and is subsequently not paid, the company may file a. a deficiency judgment b. a lis pendens c. an estoppel certificate d. a mechanic's lien

d. a mechanic's lien

15. A man lives in an apartment building. The land and structures are owned by a corporation, with one mortgage loan covering the entire property. Like the other residents, the man owns stock in the corporation and has a lease to his apartment. This type of ownership is called a a. condominium b. planned unit development c. time-share d. cooperative

d. cooperative

14. Three joint tenants own a parcel of land. One owner sells his interest to a long-time friend. After the conveyance, the remaining original owners a. become tenants in common with each other b. become tenants in common with each other and the newest owner c. become joint tenants with the newest owner d. remain joint tenants with each other and become tenants in common with the newest owner.

d. remain joint tenants with each other and become tenants in common with the newest owner.

19. Which of the following statements regarding manufactured housing in North Carolina is false? a. a manufactured home is constructed per HUD construction standards b. it has a vehicle identification number when it is sold by the manufacturer c. it remains personal property once it is placed on site unless it is converted to real property d. removal of the wheels and axles converts a manufactured home to real property

d. removal of the wheels and axles converts a manufactured home to real property

2. Which of the following is an economic characteristic of land? a. indestructibility b. uniqueness c. immobility d. scarcity

d. scarcity

18. A North Carolina seller had signed a security agreement to finance a new heat pump prior to listing his house. The seller has ten more payments left. Which statement is true? a. the heat pump is real property and conveys at settlement b. the creditor could not repossess the heat pump after closing if the seller stopped making the payments c. the buyer must take over the payments on the heat pump after closing d. the heat pump remains personalty that can be removed by the creditor prior to or after closing if the security agreement is not paid in full

d. the heat pump remains personalty that can be removed by the creditor prior to or after closing if the security agreement is not paid in full