CFM 426 Quiz 15-21, 1031

Jenny's house on Dove Street is valued at $200,000. Property in her area is assessed at 80 percent of value, and the local tax rate is 9 mills. What is her annual property tax bill?

$1,440.00

Using the cost approach, determine the value of a parcel of real estate if the land is valued at $30,000, the replacement cost of the building is $60 per square foot, the area of the building is 1,500 square feet and the total depreciation from functional and economic obsolescence has been set at $10,500

$109,500

Property assessments in Antelope County are 25 percent lower than average assessments throughout the state. If John's house in Antelope County is currently assessed at $200,000, what should the equalization factor be to bring the assessed value into line with the rest of the state's property values for taxation purposes?

$200,000/(1-.25)=$266,666.67 $266,666.7/$200,000=1.33

Three steps IN PROPER ORDER to determine property tax rates.

Adopt a budget, appropriation, tax levy

Private land developers control the aesthetic qualities of homes and buildings in a subdivision by creating and properly fling this document.

CC & R's

The reversionary right to possession is retained by the...

Lessor

If I needed to move my house closer to the lot line than permitted by law because of a steep slope on the property, what would I seek from the zoning BOARD OF ADJUSTMENTS (zoning hearing board)?

Variance

List five environmental issues (hazardous substances) discussed in the chapter.

1. Lead 2. Asbestos 3. Carbon Monoxide 4. Radon 5. Urea-Formaldehyde

According to HUD, the following advertising statements are either permitted or they are not permitted. 1. White Neighborhood 2. Near Great Catholic School 3. Wife's Dream Kitchen 4. Wheelchair Ramp 5. Family Room, Quiet Neighborhood

1. White Neighborhood - NOT PERMITTED 2. Near Great Catholic School - NOT PERMITTED 3. Wife's Dream Kitchen - NOT PERMITTED 4. Wheelchair Ramp - PERMITTED 5. Family Room, Quiet Neighborhood - PERMITTED

A commercial building is 100 feet long by 60 feet wide. All area is considered rentable space for purposes of leases entered. The monthly rental rate per square foot is $1.25. What is the potential gross yearly income for the building?

100x60=6,000sf x 1.25= 7,500 x 12 = $90,000

Businesses with ____ or more employees are subject to ADA (Americans with Disabilities Act).

15

Antelope County needs $54,000,000 in taxes and has $3,000,000,000 in taxable property, what should the tax rate be IN MILLS?

18 Mills

The Civil Right Act of ______________ prohibited discrimination based on race, color, religion or national origin.

1968

John Doe does not pay property taxes on his house valued at $200,000. The house is eventually sold at a court-ordered tax sale to Jim Brown for $150,000.

After the tax sale is completed, John Doe might have the legal right to get his property back from Jim Brown by paying only the $150,000 plus statutory accrued interest and other applicable charges. BEFORE the tax sale, John Doe would generally have the legal right to redeem his property by paying the taxes that are due plus additional legal charges imposed by the taxing authority.

The income approach is most important in determining the value of...

An office building

The direct market comparison (or comparable sales) approach is most important in determining the value of...

An older home

According to the text, which of the following methods of controlling risk is/are accomplished through the purchase of insurance? A. Avoid B. Control C. Transfer D. None of the above E. All of the above

C. Transfer

An estate for years (or estate for term)...

Can be a lease that lasts for only one day

The tenant leases a heated apartment, but the landlord fails to provide heat because of a defective central heating plant in the building. The tenant vacates the premises and refuses to pay any rent. This is an example of...

Constructive eviction

The agency responsible for the enforcement of the Fair Housing Act is the...

Department of Housing and Urban Development

Which of the following properties would be exempt from ad valorem taxes? A) Religious Chapels B) County Library Building C) City Municipal Building (city offices) D) Only two of the above E) All of the above would be exempt

E) All of the above would be exempt

According to the text, which of the following is/are included in the three principal responsibilities of property management? A. Achieve the objectives of the property owners B. Generate income for the owners C. Preserve and/or increase the value of the property D. Two of the above E. All of the above

E. All of the above

According to the text, which of the following is/are included in the three principal types of maintenance a property manager should address? A. Preventative B. Corrective C. Routine D. Two of the aboce E. All of the above

E. All of the above

Government acts that ALLOW jurisdictions to control local land use.

Enabling acts

(T/F) The seller of a four-plex must acquire (close on) replacement properties within 180 days of IDENTIFICATION of those properties in order to satisfy the 1031 Exchange rules.

FALSE, It is from RELIQUISHMENT

(T/F) A 1031 Exchange eliminates current and future tax liabilities for the gain that would have otherwise been realized on the relinquished property.

False

(T/F) A gross lease requires the tenant to pay all taxes, insurance, repairs, and utilities while in possession of the property.

False

(T/F) According to the Internal Revenue Service code, stocks, bonds, and business inventories typically qualify for 1031 Exchange treatment as long as a qualified intermediary is used in the exchange process.

False

(T/F) According to the text, the only types of insurance a property manager needs to be concerned with are fire and hazard insurance and liability insurance.

False

(T/F) CERCLA (Superfund) was designed to subsidize owners of properties with hazardous waste sites who voluntarily clean the sites without the government having to issue a citation. These subsidies, however, are limited to a maximum of 50% of the total cost of cleanup.

False

(T/F) If there is a difference between the public land-use regulations and the private land-use controls, the public land-use regulations always take precedence over or "trump" the private land-use controls.

False

(T/F) In all cases, if an exchangor (seller) identifies more than 3 properties during the identification period, she must acquire at least 95 percent of those properties in order to qualify for 1031 Exchange treatment

False

(T/F) Internal Revenue codes and regulations specify that property must be held for at least one year in order to qualify for a Section 1031 Exchange.

False

(T/F) Only individual taxpayers (not corporations, partnerships, LLC's and other tax-paying entities) may take advantage of the 1031 Exchange benefits.

False

To be binding, a lease is required to be in writing...

If the lease agreement is for more than one year

A property tax lien is an example of a(n)_______________,______________ lien

Involuntary, Specific

An estate from period to period (periodic tenancy)

Is common in residential leases

A leasehold estate (tenant's right to possess real estate)...

Is generally considered personal property

Which of the following provides standards for subdivision improvements, such as curbs, gutters, lights , and streets?

Land Development Ordinances

Which POWERS are invoked by the government to control land use?

Police

The Civil Rights Act of 1866 prohibits discrimination in housing based on...

Race

A builder purchased a beach-front property and was denied a building permit because after the builder purchased the land, the Coastal Council decided that the beach-front property should remain in its natural state in order to protect inland properties. This is referred to as a...

Regulatory Taking

(T/F) 1031 Exchange rules allow an individual to exchange property in California and acquire like-kind properties in Florida and/or Maine.

True

(T/F) A lease is really a form of contract which must meet essentially the same requirements any other contract must meet.

True

(T/F) A percentage lease might require tenants to pay a base monthly fee in addition to a percentage of their gross income.

True

(T/F) A reasonable accommodation to a public facility would be to allow guide dogs to accompany customers.

True

(T/F) A taxpayer may contract for a building to be built in the future, or may contract for improvements to an existing building, as replacement property in an exchange as long as the required value of improvements are completed within the 180-day time limit.

True

(T/F) An owner of a residential apartment complex may take advantage of the 1031 Exchange rules by trading for raw land or an apple orchard, for example, instead of a residential apartment building.

True

(T/F) Cash received by the exchanger (seller) when the relinquished property is sold is considered "boot" and will be subject to income tax. That cash will not be considered part of the exchange, even if it is used later within the exchange period to help pay for acquired property.

True

(T/F) In today's real estate market, it is illegal to restrict the sale of housing based on age.

True

(T/F) John Doe sells Golden Trails, a 20-acre parcel, to Mary Jones. Even though John Doe, the seller, no longer retains a legal interest in Golden Trails, he might be held legally liable for future hazardous waste cleanup on Golden Trails.

True

(T/F) Most states require a property manager to be a licensed real estate professional.

True

(T/F) The seller of a four-plex used as an investment property who wants to take advantage of 1031 Exchange rules must identify potential replacement properties within 45 days of closing the sale on the four-plex.

True

(T/F) Vacation homes may qualify as investment property if personal use is minimal or the home is also rented

True

If the comprehensive plan is the general plan (big picture) for the community, which of the following best represents the details?

Zoning Ordinances

When appraising a commercial income-producing property, the appraiser is most concerned with the...

annual net income

To realize maximum value, a property should be in harmony with and conform to existing neighborhood standards regarding design, construction, size and age of surrounding properties. Appraisers who apply this theory are using the principle of...

conformity

Functional obsolescence consists of...

loss of value because of the design or plan of the building

The amount of money that would most probably be paid by a buyer to a seller -- both are ready, willing and able to act, and both are fully informed -- represents...

market value

The practice by lending institutions of not making mortgage money available in certain geographic areas is...

redlining

A mechanic's lien is __________________

specific and equitable

A basic principal of value states that the maximum value of a property tends to be set by the cost of producing an equally desirable property. This is known as the principle of...

substitution