Real Estate Review
What are some examples of the trust our clients place in us?
Loyalty, Accounting, Skill, Care, Diligence, Obedience, Disclosure
What is an example of a Life estate?
"I grant to mother, Molly McCree, the right to live in and/or receive rents from said real property, until her death"
What are the FOUR types of maintenance property managers incur?
(PRRC): - Preventative maintenance- work done before expensive repair work is needed such as caulking windows and doors, changing furnace filters etc. - Routine maintenance- consists of lawn mowing, carpet cleaning and other day-to-day cleanups, which keeps the property in order for tenancy. - Repair Maintenance- involves fixing the broken water heater or dishwasher. A property in disrepair is hard to rent. - Construction Maintenance- a total remodel or an addition. For example, a club house or pool to help make the property more competitive.
What are the SIX major Real Estate Sales Specialties?
(RBASIC) 1. Residential property- a family home of 4 units or less. 2. Business Opportunity- consists of an investor purchasing an income producing business. 3. Agricultural property- farm or ranch land of more than ten acres. 4. Special Purpose property- examples would include schools, churches, nursing homes, post offices and hospitals. 5. Industrial property- usually manufactures or distributes products such as a factory or warehouse. 6. Commercial property- is income producing property such as a retail center or an apartment complex of more than four units.
Duress
(n.) compulsion by threat; forcible confinement
Net Listing
(rarely used today and illegal in many states) A variation on how much the broker will be paid. Can be A LOT or can be NOTHING. For example, a seller requires $75,000 for a property. A broker sells the property for $83,000 and receives the difference, $8,000, as commission.
What terminates an agency relationship?
- Completion - Expiration - Mutual agreement to terminate - Breach - Operation of Law - Destruction or Condemnation of the property - Death of either client or firm
What does the Florida Real Estate Commission (FREC) have the right to do?
- Oversee Licensing Process - Administer License Laws - Address Consumer Complaints
What are necessary components of a contract?
- Two or more competent parties - For Consideration - Oral or written agreement - Must be recorded
What is included in a listing agreement?
- Type of listing agreement - Parties to the contract - Description of property - Asking price - Term of contract (specified ending date) - Payment of broker's fee
What type of lien is a debt by a property owner for work done on their real estate?
Mechanic lien
Which system is used for Legal Descriptions under the English Common law?
Metes and Bounds
What is the lien priority?
1. Real Property Taxes and Special Assessments 2. Mortgages 3. Mechanics Liens
26.75 acres to square feet:
26.75 acres * 43,560 sqft = 1,165,230 sqft
286,450 square feet to acres:
286,450 sqft /43,560 sqft = 6.58 acres
How many sections are in a township?
36 sections, 36 square miles
What is the size of every single township?
36 square miles
How many 1/4 acre lots are in 1 acre?
4
How many 1/8 acre lots are in 408,375 square feet?
408,375 sqft /43,560 sqft = 9.375 acres * 8 acre lots = 75 acre lots
How many square feet are in an acre?
43,560 square feet (4 old ladies going 35 in a 60)
How many acres are in a section (square mile)?
640 acres
How many members are in the FREC?
7 (appointed by the governor, subject to confirmation by the Senate)
Which of the following Bundle of Rights would only be held by the owner of the property? A. Disposition B. Exclusion C. Enjoyment D. Possession E. Control
A (Disposition gives the right to sell or give away property)
What is an encumbrance?
A burden or charge that has been placed on the property that can affect the marketability and/or transferability of the property
What is equitable title?
A buyer's right to have property transferred once all conditions of the contract are met.
Amendment
A change in, or addition to, a constitution or law
What is a void contract?
A contract having no legal force or binding effect.
What is Tenancy in Partnership?
A form of ownership held by business partners as provided by the Uniform Partnership Act. Act. It grants equal rights to all partners, but the property must be used in connection with the partnership's business.
What is a contract?
A legally enforceable agreement
Voluntary Lien
A lien placed on property with the knowledge and consent of the property owner.
Involuntary Lien
A lien placed on property without the consent of the property owner.
What document establishes an agency relationship?
A listing agreement, a contract
Multiple Listing Service (MLS)
A listing service whereby local members of the Board of REALTORS agree to share listings and commissions on properties sold jointly. Members of the public may have access to the MLS, but not to all of the features and content.
What is a plat map?
A map of a town, section, or subdivision indicating the location and boundaries of individual properties.
Compensatory Damages
A monetary award equivalent to the actual value of injuries or damage sustained by the aggrieved party. "You cost me this much money"
What are littoral rights?
A navigable body of water in which ownership is determined by tide movement. Properties nearby own until the mean high water mark (high tide line). The rest remains for public use. (LITTORAL-LAKE, LITTORAL-LAKE)
Time is of the essence
A phrase in a contract that requires the performance of a certain act within a stated period of time.
What is an appurtenance?
A right, privilege, or restriction that goes with ownership of land (belongs to the land)
Exclusive Right to Sell Listing
A seller contracts exclusively with a single broker. If a buyer is procured during the listing period, the broker is entitled to a commission, regardless of who is procuring cause. Thus, if anyone—the owner, another broker—sells the property, the owner must pay the listing broker the contracted commission.
What is the difference between a specific and general lien?
A specific lien is attached to a specific piece of property while a general lien is attached to all forms of property an individual owns.
Who draws up a plat map?
A surveyor
Involuntary Alienation
A transfer of title to real property without the owner's consent .
What is a "Fiduciary" relationship?
A trust based relationship with a client.
What causes land gain due to natural water movement?
Accretion- Increase in land from deposits of soil from the body of water Reliction- Increase in land due to the receding of water (such as the increase of land at the Great Salt Lake). (Accre"T"ion & Relic"T"ion, THINK + addition)
What dictates an agency relationship?
Agency law dictates how the relationship will achieve its purposes, regardless of what the listing contract states.
Addendum
An addition or supplement designed to increase correctness, completeness, or currency
Liquidated Damages
An amount, pre-determined and stipulated in the contract, that the parties to a contract believe to be a reasonable estimation of the damages that will occur in the event of a breach.
What is the difference between an express and implied agreement?
An express agreement is a clearly stated written (enforceable in court of law) or oral (non-enforceable in court of law) agreement. Meanwhile, an implied agreement is based on the actions of the broker.
What is a fixture?
An item of personal property that has been converted to real property
Who is the customer in an agency relationship?
Anyone other than our client.
Exclusive Agency
Authorizes a single broker to sell the property and earn a commission, but leaves the owner the right to sell the property without the broker's assistance, in which case no commission is owed.
What causes land loss due to natural water movement?
Avulsion- "Sudden" loss of land by an act of nature such a hurricane or typhoon (like the loss of beach). Erosion- Decrease of land by gradual wearing caused by flowing water. (AvulSion & EroSion, THINK S for subtraction)
In which leasehold estate does the tenant refuse to leave past an eviction notice? A. Estate from Period-to-Period, B. Estate at Sufferance C. Estate for Years D. Estate at Will
B
What approach uses quick opinions to determine a sales price for a short-sale property or a foreclosed property to be listed, usually requested by a Mortgage Loan Office or bank?
Broker Price Opinion (BPO)
What does an easement do? A. Creates a debt on a property B. Forces the owner to move out of their property C. Grants a person the ability to get to their property through another D. Allows a person to build a shed on someone else's property
C
Which of the following agency relationships is illegal in Florida? A. Single Agency B. Subagency C. Dual Agency D. No Agency E. No Subagency
C
Which of the following forms of Concurrent Ownership occurs when owners are married? A. Tenancy in Common B. Joint Tenancy C. Tenancy by the Entirety D. Tenancy in Partnership
C
Which type of Freehold estate has conditions or restricted use? A. Fee Simple Absolute B. Estate at Sufferance C. Fee Simple Defeasible D. Conventional Life Estate
C
What types of properties are more commonly granted a Conditional-use permit?
Churches, schools, and small or home-based businesses in residential neighborhoods
What approach uses recent home sales and homes currently on the market usually through special computer programs, such as the Multiple Listing Service (MLS), to determine property value?
Comparative Market Analysis (CMA)
In which exception to zoning ordinances, is a permit granted to allow for a piece of land to be altered in how it can be used in accordance with the local zoning ordinance?
Conditional-use permit
General Warranty Deed
Contains the fullest possible assurance of good title and protection for the grantee... "I own and will defend."
Which type of Freehold estate includes the full bundle of rights? A. Fee Simple Defeasible B. Life Estate C. Estate for Years D. Fee Simple
D
What does a person have to prove to obtain a variance?
Dire Harm ONLY to you.
Zoning
Dividing an area into zones or sections reserved for different purposes such as residence and business and manufacturing etc
Which easement is granted by court and allows a person to get to their property through another?
Easement Appurtenant
What are THREE types of easements?
Easement Appurtenant, Easement in Gross, Easement in Prescription
Which easement is used for commercial purposes?
Easement in Gross
Which easement allows a person to use a portion of another's property for some time or even continual use?
Easement in Prescription
What does the Uniform Residential Landlord and Tenant Act (URLTA)?
Equalize rights of tenants and landlord and protection from unjust practices (Think ultra protection)
What is the difference between the 4 types of leasehold estates?
Estate for Years has a definite start and end date, Estate from Period-to-Period may be renewed at the end of a lease term, Estate at Will has no definite end date as long as rent is paid, and Estate at sufferance is a tenant who refuses to leave after the lease expiration date.
What are freehold estates?
Estates where duration of the owner's rights cannot be determined, may endure a lifetime, less or more. This includes a Fee Simple estate which includes the full bundle of rights and the Life estate which is limited to the owner's lifespan.
What is modular housing?
Factory-built in pieces that are assembled on site and meet local building codes.
What is the broker's authority to prepare documents?
Fill the blanks on pre-printed forms, agents never draft forms, that's the job of an attorney.
Open Listing
First come, first serve, the FIRST Broker to perform under the terms of the listing is the sole party entitled to a commission
What are the two main types of estates?
Freehold estates and Leasehold estates
Which type of agent handles multiple transactions of a principal/client and may act as a property manager for a principal?
General agent
Special Warranty Deed (Limited warranty deed)
Grantor only defends against his period of ownership ... "I own and will defend against my acts only."
What must a person do to become an official owner of a property?
Have the grantor sign the deed and bring it to court.
What are man-made appurtenances?
Houses, fences, barns, and swimming pools
What are riparian rights?
If the body of water is non-navigable it becomes the private property of nearby properties. If it is navigable, then nearby properties may use up to the water's edge. (RIPARIAN-RIVER, RIPARIAN-RIVER)
What is the difference between a bilateral and unilateral contract?
In a Bilateral contract both parties promise to perform to respective parts of an agreement, while in a unilateral contract only one party promises to do something, providing the other party does something.
What is a difference between a default by tenant and default by landlord?
In a Default by tenant, the TENANT fails to pay rent or causes damage. Now the landlord can sue them. In a Default by landlord, the LANDLORD fails to provide services, maybe didn't fix a recurring problem. Now the tenant can sue them.
What is the difference between an Exclusive Seller Agency and Exclusive Buyer Agency?
In an Exclusive Seller Agency, only one brokerage can represent the seller and in an Exclusive Buyer Agency, only one brokerage can represent the buyer.
What is the difference between an executory contract and an executed contract?
In an executory contract performance is yet to be completed and in an executed contract promises have been fully performed and fulfilled.
Why are tie-in agreements bad?
It attempts to bind the client to another service in the promise of completing a current service. Thus, it shifts the focus from the client to compensatory gain for the agent.
What happens when a valid contract is breached?
It becomes voidable
What happens when someone with a valid contract is under duress, intoxicated, or incapacitated?
It becomes voidable
If Katherine is selling her property, lists with Keller Williams and has accepted an offer, but has a fatal accident and dies, what happens to the sales contract?
It continues, sales contracts survive death
If Katherine is selling her property, lists with Keller Williams, but has a fatal accident and dies, what happens to the listing agreement?
It terminates
Is an oral agreement enforceable?
It's permissible but non-enforceable in court of law!
Which form of estate ownership has rights and interest that are indivisible and equal?
Joint Tenancy
Is Florida a Lien Theory State or a Title Theory (Deed of Trust) State?
Lien Theory State
What are deed restrictions?
Limitation imposed on a buyer's use of a property
What damages do real estate agents most often face in residential sales?
Liquidated Damages
Commingling
Mixing broker's money with that of others. "I'm going to directly deposit my client's money into my account."
Does Tenancy in Common have the right of survivorship?
No
Can real estate broker's licensed outside of Florida sell Florida real property?
No, A broker licensed in another state must sell the property in that state and no other, so a Missouri broker cannot come into Florida and sell Florida property, but he can collect a referral fee from a Florida broker when a property sells that he referred the broker to.
If the subagent representing their firm dies, is an agency relationship terminated?
No, because the firm represents the client, not the subagent
Can a contract be voidable if it does not have consideration?
No, it's an unenforceable contract because it does not meet the requirements
Are Keller Williams, Coldwell Banker, or Century 21 firms?
No, they are franchises/brands, however, individual locations are considered firms as they work independently of one another.
Arm's Length Transaction
Occurs between willing buyer and willing seller with each party completely knowledgeable about the market. A purchaser of property between relatives (father & son) would not be an "arms length transaction".
What are the two main types of estate ownerships?
Ownership in Severalty and Concurrent Ownership
What is a trade fixture?
Personal property of a business owner, that when attached to a rented space or building remains personal property. - trade fixtures must be removed by last day the property is rented - tenant is responsible for any damages caused by the removal of a trade fixture - trade fixtures that are not removed become the real property of the landlord
What is a manufactured (mobile home)?
Personal property that may convert to real property through attachment to a permanent foundation and notification to the Department of Motor Vehicles to verify that it's no longer a moving vehicle. It does not meet local building codes as it is not considered a structure.
What type of plants new considered real property?
Plants that do not require annual cultivation (replanting/harvesting)
Who do you contact if someone is violating a law?
Police (Public government)
Who are the TWO kinds of groups that can restrict land use?
Public (government) and Private (non-government)
What does the Division of Real Estate (DRE) do?
Record keeping services, examination services, legal services, and investigative services, and those services in chapter 455.
What can cause a breach of a contract?
Rescission- a damaged party may rescind a contract Forfeiture- requires breaching party to give something up, according to contract Suit for damages- a damaged party may sue for money damages in civil court Suit for specific performance- an attempt to force the defaulting party to comply with the terms of the contract
What are the property type specializations?
Residential property- habitation, classified by amount of residing families. Commercial property- retail/office Investment property- held by owners for investment purposes
In a Conventional Life estate, who owns the home after the most current owner dies?
Rights pass to a remainderman or revert to the previous owner.
Who is the servant and who is the dominant in an easement?
Servant- the property being used, the one in which the easement is placed on Dominant- the person benefiting from the easement
Consequential Damages
Special damages that compensate for a loss that is not direct or immediate (for example, lost profits). The special damages must have been reasonably foreseeable at the time the breach or injury occurred in order for the plaintiff to collect them. "Put a price tag on it"
Which type of agent is limited to specific activities, typically one, selling a house?
Special or limited agent
What are most real estate agents considered?
Special or limited agents
What are leasehold estates?
Specific duration according to the lease term. Those include Estate for Years, Estate from Period-to-Period, Estate at Will, and Estate at sufferance?
Which is the most common form of estate ownership when owners are not married?
Tenancy in Common
Which states are based on the English Common law?
The 13 colonies: Delaware, Pennsylvania, New Jersey, Georgia, Connecticut, Massachusetts Bay, Maryland, South Carolina, New Hampshire, Virginia, New York, North Carolina, and Rhode Island and Providence Plantations
Conversion
The act of misappropriating escrow funds for the broker's business or personal use. "I'm going to take a vacation with my client's money"
Who is the subagent in an agency relationship?
The agent of an agent (firm/broker) representing a client.
What is a Fee Simple on Condition Subsequent estate?
The all but one use of a property. "You may not serve alcohol in the establishment. "If any condition is violated, the previous owner may repossess the property.
Who is the principal in an agency relationship?
The client represented by the broker (agent).
What is an agency relationship?
The fiduciary relation between a broker and a client
Who is the agent in an agency relationship?
The firm (broker) representing a client.
Bargain and sale deed
The grantor may or may not warrant against encumbrances by other parties ..."I own, but won't defend"
Market allocation
The practice of colluding to restrict competitive activity in portions of a market in exchange for a reciprocal restriction from a competitor. "We won't compete against you here if you won't compete against us there."
What is price fixing (collusion) and what does it violate?
The practice of colluding with other firms to control prices. "They're charging you 7% commission but we'll charge you 6%." It violates the Sherman Antitrust Act
Tie-in agreements
The sale of one product or performance of a service is tied to the sale of another, less desirable product or service. "I will list and sell your old home if you hire me to find you a new home to purchase."
What is a Fee Simple Determinable estate?
The sole use of a property. "As long as the land is used as a park." If the restrictions are violated, the estate automatically reverts to the grantor or heirs.
Voluntary Alienation
The transfer of title by a deed.
What are Legal Descriptions?
They accurately locate and identify the boundaries of the subject parcel
Why does a seller hire an agency?
To maximize their outcome
Quitclaim deed
Transfers real and potential interests in a property, whether an interest is known to exist or not ... "I may or may not own, and I won't defend."
What are natural appurtenances?
Trees, creaks, and streams
Is this statement true or false? Fee Simple Absolute estates may be freely passed onto heirs with no conditions or restrictions.
True
What is a co-brokered transaction?
Two firms independently representing a buyer and seller.
What is an encroachment?
Unauthorized use of another's property
What types of agents exist in an agency relationship?
Universal Agency, General Agency, and Special or limited Agency
Which type of agent has the full power to act on behalf of a principal and may even purchase a home on their behalf?
Universal agent
Ilegal Non-Conforming Use
Use of a property that began illegally after the zoning ordinances were in place and is NEVER allowed.
Legal Non-Conforming Use
Use of a property that does not fit the zoning for the area, but is allowed because of special allowance or because the use was already in effect at the time the zoning was determined.
In which exception to zoning ordinances, does the authority grant permission for use other than that specified in the zoning ordinance?
Variance
What are the exceptions to zoning ordinances?
Variance or Conditional-use permit
Does Tenancy by the Entirety have the right of survivorship?
Yes
Does an agency relationship exist in lease agreements?
Yes
Does Joint Tenancy have the right of survivorship?
Yes (If the property is split into 3 owners and 1 owner dies, the remaining 2 owners receive the portion, from 33% to 50% each)
Are crops personal property?
Yes, they were planted by and belong to the seller
Who represents the seller?
Your firm, the agent. Thus, you are the subagent because you represent the firm by working for them. (Example: Shirley works for Keller Williams. KW is the agent and Shirley is the subagent representing the seller.)
What is a lien?
a right to keep possession of property belonging to another person until a debt owed by that person is discharged
Ownership in Severalty occurs when
a single party owns the life estate (They have "severed" ties with all other owners, they have sole ownership of the property)
What are monuments?
fixed objects such as stones, lakes, and highways
What does a free trader agreement do?
it is a document used when one spouse wants the right to obtain real estate independent of the other
Caveat Emptor
let the buyer beware, buy at your own risk
Concurrent Ownership occurs when
more than one person, or a legal entity such as a corporation owns an estate in land
What is the Metes and Bounds Survey System?
natural landscapes were used to draw boundaries for irregular land
Who do you contact if someone is violating a HOA or covenant ?
neighbors are responsible for enforcing such covenants
Residential Property Disclosure Act
requires sellers to provide purchasers with a disclosure statement prior to presentation of the first offer with Yes, No or No representation. Seller has no requirement to disclose the condition of the property; exemptions - new construction, foreclosures and lease purchases Y43
In a Lien Theory State...
the borrower (buyer) keeps legal title to the property during the period of the loan and the lender places a lien against the property.
In a Title Theory (Deed of Trust) State...
the lender holds legal title to the real estate, and the borrower retains equitable title.
How many co-owners and shares of ownership can exist in a Tenancy in Common?
unlimited and unrestricted shares (Can be 20/30/50% or 10/60/20%, etc.)
What is the most common way to reject an offer?
until we revoke it or it is accepted, another way is by the expiration date