Texas Principals of Real Estate - Part 2
A house sold for $320,000 with a 6% commission rate. The commission split between the seller and buyer's broker was 50%. The commission split between the seller's broker and his salesperson was 60/40. How much did the salesperson earn as a commission?
$,3840
If the annual interest paid on a loan is $10,000, with an interest rate of 8%, what I the total amount of the loan?
$125,000
A property owner wants to build a new fence around his property. The fence will cost $20 per linear foot. If the property measures 175' x 200', how much will the fence cost to build...?
$15,000
What did an owner originally pay for his home if he sold it for $200,000, which yielded a 10% profit...?
$181,818.18
What is the annual interest on a $320,000 loan with an interest rate of 6%?
$19,200
The total commission paid on the sale of a home was $8,000. The commission split between the seller and buyer's broker was 50%. If the commission split between the seller's broker and his salesperson is 50%, how much did the salesperson earn?
$2,000
The annual taxes on a property are $4,800. If the property is sold at the mid-date of the year, how much of the annual property taxes will the seller be responsible for?
$2,400
If a lender charges an origination fee of 1 point and 3 discount points, what will be the total amount paid in points on a $500,000 loan?
$20,000
What did an owner originally pay for his home if he sold it for $360,000, which yielded a 15% profit?
$313,043.48
A lender is willing to provide a mortgage up to 90% of a property's $360,000 contract price. How much will the borrower have to put up as a down payment?
$36,000
The total commission on the sale of a home was $10,000. If the seller's broker earned a 60% commission split, and the buyer's broker earned a 40% commission split, how much did the seller's broker earn?
$5,000
What is the annual interest rate on a $200,000 loan with an interest rate of 5%?
$5,000
The total commission on the sale of a home was $9,000. If the seller's broker earned a 60% commission split, and the buyer's broker earned a 40% commission split, how much did the seller's broker earn?
$5,400
A house is appraised at $360,000. If the local property tax rate is $2 per $100 of appraised value, what is the amount paid in monthly property taxes?
$600
A house is appraised at $240,000. If the local property tax rate is $3 per $100 of appraised value, what is the amount paid in annual property taxes?
$7,200
A house is appraised at $360,000. If the local property tax rate is $2 per $100 of appraised value, what is the amount paid in annual property taxes?
$7,200
A property sold for $270,000 with a 5% total commission paid to the seller and buyer's broker. If the commission split between the seller and buyer's broker is 60/40, how much did the seller's broker earn?
$8,100
A room measures 12'0" x 15'6". What would it cost to lay down new flooring that costs $5 per square foot?
$930
1/4 is equal to?
0.25
Improper fractions are always greater than...?
1
Proper fractions are always less than?
1
If a lender charges a 1 point origination fee, what will be the cost of the origination fee?
1% of the loan
8/5 is equal to...?
1.6
Which of the following loan terms will yield the highest monthly mortgage payment?
10 years
12'-5" is equal to?
12.417'
What is the area of a room that measures 15'-6" x 13'-3"...?
205.375 square feet
Which of the following loan terms will yield the lowest monthly mortgage payment?
30 years
How many hours of appraisal education is required to become a general certified real estate appraiser?
300 hours
Three investors purchased a property for $580,000. Investor A contributed $157,000, while investor B contributed $220,000. What percentage of ownership was left for the third investor...?
35%
If the annual interest paid on a loan is $3,000, and the total loan amount is $60,000, what is the interest rate?
5%
If a property measures 150' wide by 120' deep, how many linear feet will the perimeter of the property measure...?
540'
If the sale price on a home was $250,000 and the broker commission was $15,000, what was the commission rate for the sale...?
6%
How much experience is needed to become a real estate appraiser trainee?
75 hours
Scarcity
A finite supply
Comparative Market Analysis (CMA)
A light variation of the sales comparison approach that's used by real estate agents to help buyers and sellers estimate a market value.
Assessed Value
A valuation placed upon a piece of property by a public authority as a basis for levying taxes on the property.
Anticipation
A value can increase or decrease in anticipation of some future benefit or detriment affecting the property. Ex. When a new mall is going into an area many times, the surrounding property's are affected in a positive way.
Principle of Substitution
Affirms that the maximum value of a property tends to be set by the cost of acquiring an equally desirable and valuable substitute property, assuming no costly delay is encountered in making the substitution.
The liquidation of a financial obligation on an installment basis is referred to as?
Amortization
Formal opinion of value is conducted by
An appraiser
Appraisal
An estimate of the value of property resulting from an analysis of facts about the property.
Sales Comparison Approach (Market Data Approach)
An indicated value is obtained by comparing a property with recently sold comparable properties.
One qualified by education, training and experience who is hired to estimate the value of real and personal property based on experience, judgment, facts, and use of formal appraisal processes is known as a/an...?
Appraiser
Which of the following is the lowest real estate appraiser classification?
Appraiser trainee
Income approach
Based on the premise that the income obtained from a property will, to a large extent, influence the value of that property.
Real Estate
Business of value
Members of general public informally estimate a value when they
Buy, sell, or invest in real estate
When using sales data to compare to the subject property, appraisers should use sales that are?
Current
The bottom number in a written fraction is called the...?
Denominator
After the needed data has been obtained and verified, what is the next step in the appraisal process?
Determine the highest and best use
Principle of Conformity
Holds that the maximum of value is realized when a reasonable degree of homogeneity of improvements is present.
What is the second step in the appraisal process?
List the data needed
Which of the following is used by lenders to increase the lender's yield on the loan without increasing the annual interest rate?
Loan discount points
The most common objective of an appraisal is to develop an opinion of...?
Market Value
1-1/4 is an example of a...?
Mixed Number
In an improper fraction, the ............... is larger than the denominator?
Numerator
The top number in a written fraction is called the...?
Numerator
Appraiser
One qualified by education, training and experience who is hired to estimate the value of real and personal property based on experience, judgment, facts, and use of formal appraisal processes.
Appraiser
One qualified by education, training, and experience who is hired to estimate the value of real and personal property based on experience, judgment, facts, and use of formal appraisal processes.
Value
Present worth of future benefits arising out of ownership to typical users/investors
1/4 is an example of a/an?
Proper fraction
A single value is derived from the three appraisal methods of determining value during the ............ process?
Reconciliation
Depreciation
Refers to any condition that diminishes the value of an improvement to the real property.
What are the three approaches?
Sales comparison approach, cost approach, income approach
What is the first step in the appraisal process?
State the problem
Reconciliation
Taking the values indicated by the various approaches used in reconciling them into one single value.
Appraisal is defined as?
The act or process of developing an opinion of value or simply an option of value.
Utility
The capacity to satisfy human needs and desires
Utility
The capacity to satisfy human needs and desires.
Change
The concept that no physical economic condition remains constant.
Insured Value
The cost of replacing a structure completely destroyed by an insured hazard.
Book Value
The current value for accounting purposes of an asset expressed as original cost plus capital additions minus accumulated depreciation.
Effective Demand
The desire for possession or ownership backed by the financial means to satisfy that need.
Transferability
The ease with which ownership rights are transferred from one person to another.
Market Value
The highest price in terms of money which a property will bring in a competitive and open market and under all conditions required for a fair sale, i.e., the buyer and seller acting prudently, knowledgeably and neither affected by undue pressures.
Market Value
The highest price in terms of money which a property will bring in competitive and open market and under all conditions required for a fair sale, i.e., the buyer and seller acting prudently, knowledgeably and neither affected by undue pressures.
Plottage (Plottage Value)
The increased utility and value resulting from combining or consolidating to adjacent or more lots into one larger lot.
The value portion of loan to value is defined as?
The lower of the appraised value or the sales price.
Seller Net Return
The money the seller walks away from closing after selling a property after their commissions and closing costs and other fees associated with selling are absorbed.
Market Value
The most probable price a property should bring
Highest and Best Use
The most probable use to which a property is suited that results in its highest value or highest returns to the land.
Highest and best use
The most probably use to which property is suited that result in its highest value or its highest return to the land
Effective demand
The need or the desire for possession or ownership backed by the financial means to satisfy that need.
Market Price
The price paid regardless of pressures, motives or intelligence.
Externalities
The principle of externalities states that influences outside of property can have a positive or negative effect on its value. For example, property that backs up to a city dump.
Substitution
The principle of substitution states the maximum value of a property tends to be set by the cost of purchasing an equally desirable and valuable substitute property.
Supply and demand
The principle that states the value of a property will increase if the supply decreases and the demand either increases or remains constant and vice versa.
Supply and Demand
The principle that states the value of a property will increase if the supply decreases and the demand will either increase or remains constant, and visa versa.
Transferability
The relative ease with which ownership rights are transferred from one person to another.
Scarcity
The supply of property in relation to effective demand
Contribution
The value of any component of a property is measured by the amount that contributes to the value of the whole or the amount. Ex. Cost of installing ac system & remodeling older office may be greater than justified by rental increase that may result from improvement to property.
Conformity
This concept speaks to the idea that the maximum value is realized if the use of land conforms to existing neighborhood standards.
Competition
This principle state that excess profits tend to attract competition. Ex. Successful grocery store usually attracts investors to open similar stores in the area which tends to reduce the profit for all stores concerned.
Real estate appraisers used to appraise a property cannot be selected by the real estate brokers involved in the transaction? (T/F)
True
The present worth of future benefits arising out of ownership to typical users/investors is known as?
Value
Cost Approach
Value based on the properties cost to reproduce the same property.
5/4 is an example of a/an...?
improper fraction
8/7 is an example of a/an...?
improper fraction