Real Estate Investments
C (Fix and flip)
Allen picked up remodeling skills from his family's construction business. Which of the following real estate investments is a great fit for his skills? A. Buy and hold B. Wholesaling C. Fix and flip D. Limited partnership
D (Preserve capital)
For both homeowners and real estate investors, buying real estate is considered a good way to _____________. A. Discover multiple tax loopholes B. Get rich quick C. Increase a credit rating immediately D. Preserve capital
C (Uniqueness)
Janice and Steve's oceanfront house is worth significantly more than an identical house up the coast a few miles. Which characteristic of the real estate market do they have to thank for this? A. Immobility B. Indestructibility C. Uniqueness D. Governmental policy
B (Federal and local government)
Taxes, construction codes, and development regulations are all ways that ______ can influence a real estate investment and potentially increase or decrease the investment's value. A. A real estate brokerage B. Federal and local government C. Society D. The environment
B (Insured value)
The Stewarts have lived in their home along the Eastern Seaboard for 30 years and don't have any intention of selling. They're responsible homeowners, so every now and then they make sure to determine the _______ of their home in case it's destroyed and must be replaced. A. Going-concern value B. Insured value C. Salvage value D. Value in use
A (Immobility)
The cliffs where Janice and Steve's oceanfront house is perched and eroded. heir home is suddenly a lot closer to the ocean, uncomfortably close. In fact, and now their property is worth a whole lot less. What characteristic of the real estate market is affecting the value of their home? A. Immobility B. Indestructibility C. Uniqueness D. Governmental policy
C (Regression)
The houses in one neighborhood are all of similar sizes and style. When the Smiths' house goes into foreclosure, what principle will affect the value of the next-door neighbors' house if they sell at the same time? A. Anticipation B. Progression C. Regression D. Conformity
C (Both an investment strategy and a property type)
When it comes to real estate investments, "commercial" is _______. A. An investment strategy B. A property type C. Both an investment strategy and a property type D. Neither an investment strategy nor a property type
C (Supply and demand)
When prices go down because there are too many homes on the market and too few buyers, this is an example of ______. A. Conformity B. Progression C. Supply and demand D. Regression
B (Zoning)
Which of the following government influences can affect value by restricting use of a property, perhaps even preventing the highest and best use of a property? A. Construction codes B. Zoning C. Federal control of money D. Taxes
D (Limited partnership)
Which of the following is a passive type of real estate investment? A. Fix and flip B. Wholesale C. Buy and hold D. Limited partnership
A (Real estate investment is different from other investments because there's potential for earning income two different ways from the same investment)
Which of the following statements regarding investments is true? A. Real estate investment is different from other investments because there's potential for earning income two different ways from the same investment. B. Many investors choose real estate over other types of investments because real estate investments are virtually risk free, provided the investor follows the law. C. In general, when an investor sells a property, it's likely to be for a lower price, because properties depreciate over time. D. Only inexperienced investors consider real estate as a hedge against inflation, because property values typically decrease over time.
B (Environmental codes)
Your client is a large developer who wants to build new retail space. She's considered zoning, construction codes, and development regulations. What other governmental influence will she also need to consider? A. Community demographics B. Environmental codes C. Architectural uniqueness
