Real Estate Principles & Practices

Types of listing agreements

-Exclusive-right-to-sell listing -Exclusive-agency listings -Open listing

Factors affecting supply for real estate

-Labor force and construction & material cost -Government controls and financial policies

Factors affecting demand for real estate

-Population -Demographics -Employment and wage levels

Puffing vs Fraud

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Types of Buyer Agency Agreements

1. Exclusion buyer agency agreement 2. Exclusion agency buyer agency agreement 3. Open buyer agency

Three Basic methods used to describe real estate

1. Metes and bounds 2. Rectangular 3. Lot and block

Legal tests of a fixture

1. Method of annexation (permanence) 2. Adaptation to real estate 3. Agreement

3 ways to own a business

1. Proprietorship 2. Partnership 3. Corporation

Fee simple ownership personally

1. Severely 2. Co-ownership 3. Trust

Lien

A charge against property that provides security for a debt or an obligation of the property owner

Coinsurance clause

A clause in insurance policies covering real property that requires that the policyholder maintain homeowners insurance converge generally equal to at least 80% of the property's actual replacement cost

Trust

A fiduciary arrangement whereby property is conveyed to a person or institution, called a trustee, to be held and administered on behalf of another person, called a beneficiary. The one who conveys the trust is called the trustor

Latent Defect

A hidden structural defect that could not be discovered by ordinary inspections and that threatens the property's soundness or the safety of the inhabitants

Remainer

A person to whom the property will pass when the life estate ends

Cooperatives

A residential multiunit building whose title is held by a trust or corporation that is owned by and operated for the benefit of person living within the building, who are the beneficial owners of the trust or stockholders of the corporation, each possessing a proprietary lease

Competitive Market Analysis

A sales person can help the seller determine a listing price for the property by using a competitive market analysis

Leasehold estates

A tenants right to occupy real estate during the term of a lease; generally considered to be a personal property interest

Salesperson's compensation

Also known as brokerage fee,Computed as a percentage of the total sales price, flat fee or hourly rate

Freehold estates

An Estate in land in which ownership is for an indeterminate length of time, in contrast to a lease-hold estate

Express Agency

An agency relationship based on a formal agreement

Real Estate salesperson

Any person licensed to preform real estate activities on behalf of a licensed real estate broker

Deed restrictions

Are private restrictions that affect the use of the land

Areas of Real Estate Specialization

Brokerage, Licensee, Appraisal, Home Inspection, Property Manager, Financing, Title Agencies, Subdivision and Development, Counseling, Education

6 common law fiduciary duties

Care, obedience, loyalty, disclosure, accounting, confidentiality

Types of Housing

Condominium, Cooperative, PUD, MUD, Manufactured housing (mobile home)

Tenancy in common

Each tenant holds an undivided fractional interests in the property

Independent contractor versus employee

Employee- follows rules governing such matters as working hours, office routine, attendance at sales meeting, assignment of sales quotas, and adherence to dress code Independent contractor- Operates more independently, broker may control what the independent contractor does, the broker cannot dictate how to do it

Life Estate

Freehold estate limited in duration to the life of the owner or the life of some other designated person or persons

Salesperson licensing procedure

How to be Real Estate agent (look at notes)

Physical characteristics of real estate

Immobility, Indestructibility, Uniqueness

Implied Agency

Informal agency agreement

Encumbrance

Is a claim, charge, or liability that attaches to real estate

Dower

Is the life estate that a wife or husband has in the real estate of the deceased spouse

Eminent Domain

Is the right of the government to acquire privately owned real estate for public use

Easements

Is the right to use the land of another for a particular purpose

Fee Tail Estate

It is an estate that, instead of descending to the heirs as fee simple does, is limited to the "issue of the body" of the recipient-that is, the recipients biological children, but only for one generation

Township lines

Lines running east and west parallel to the base line and six miles apart

Units of land measurement

Mile=5,280 feet square mile= 640 acres acre=43,560 feet

Escheat

Not a limitation on ownership, it is an avenue by which the state may acquire privately owned real or personal property

Encroachment

Occurs when all or part of a structure illegally extends beyond the land of its owner or beyond the legal building lines

Ohio plat act

Owner of parcel divides it into two or more lots, any which of them is less than 5 acres, the owner must have the land surveyed and a plat prepared and recorded in the county recorders office.

Littoral Rights

Owners who land boarders commercially navigable lakes, seas, and oceans.

Real Property

Real estate plus the interest, benefits, and rights inherent with its ownership

Dual Agency

Representing both parties to a transaction, this is unethical unless both parties agree to it and its illegal in many states

Flood Insurance

Required on all types of buildings-residential, commercial, industrial, agricultural-for either the value of the property of the amount of the mortgage loan, subject to the maximum limits available

Types of real property

Residential Property, Commercial property, mixed-use, industrial property, agricultural property, special purpose property

Real Estate

Same as land wether natural or man-made

Economic characteristics of real estate

Scarcity, Improvements, Permanence of investment, Area preference

Time share ownership

Shared ownership between people

Canons of Ethics

Standards of professional conduct prescribed for lawyers and in their professional dealings

Fee simple/Fee simple defeasible

Subject to the occurrence or nonoccurrence of some specified event. two categories that lead into that are fee simple determinable and fee simple subject

Exclusion of tax on capital gain

TBD

Condominium

The absolute ownership of a unit in a multiunit or single unit building based on a legal description of the airspace the unit actually occupies, plus an undivided interest in the ownership of the common elements which are owned jointly with the other condominium unit owners

PITI

The basic monthly costs of owning a home: principle, interest, real estate taxes, and hazard insurance

Brokerage

The business of bringing together parties interested in making real estate transaction for a fee or commission

Bundle of legal rights

The concept of land ownership that means ownership of all legal right to the land for example possession, control within the law, and enjoyment

Land

The earths surface, extending downward to the center of the earth and upward infinentlu into space, including things permanently attached by nature, such as trees and water

Fee simple/Fee simple absolute

The highest interest in real estate recognized by law

Range Lines

The land on either side of a principal meridian is divided into six-mile-wide strips by lines that run north and south, parallel to the meridian. These north south strips of land are called ranges

Market Value

The most probable price that a property would bring in a fair sale

Post licensing Requiremtns

The new salesperson has one year after the issuance of a sales license to complete ten hours of classroom instruction on current issues relating to consumers, real estate practice, ethics, and real estate law. If proof of completion is not submitted within 12 months, the license will automatically be suspended with a one year grace period in which to complete instructions

Police Power

The power to enact legislation to preserve order, protect the public health and safety, and promote the general welfare of its citizens

Rights of surivorship

The right of a survivor of a deceased person to the property of said deceased. A distinguishing characteristic of a joint tenancy relationship

Sections

Township squares are subdivided into sections and subsections called halves and quarters that can be further divided. Each township contains 36 sections. Each section is one square mile or 640 acres.

Riparian rights

common law rights granted to owners of land along the course of a river, stream, or similar body of water

Reversionary interest

creator will recapture ownership when the life estate ends

Tenancy by the entirety

is a form of tenancy in which the owners are husband and wife

Ohio Real Estate Commission

the commission percentage is negotiable