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REAL 4000 UGA Test 1 Questions and
Answers
property
✓ ~~~ anything that can be owned or possessed
tangible assets
✓ ~~~ physical things, such as automobiles, clothing, land, or buildings
intangible assets
✓ ~~~ nonphysical things which include contractual rights (e.g., mortgage and lease
agreements), financial claims (e.g., stocks and bonds), interests, patents, or trademarks
how is the term "real estate" used?
✓ ~~~ 1. used to identify tangible assets of land/buildings
2. used to denote the bundle of rights associated w/ ownership of assets
3. used in reference to the business of real estate
improvements on land vs improvements to land
✓ ~~~ ON land - fixed structures such as buildings, walls etc
TO land - include components necessary to make the land suitable to be used such
as infrastructure
land
✓ ~~~ - often used to refer to a building site, lot, etc. and not just land
,raw land
✓ ~~~ land that does NOT include structures or any improvements
real property
✓ ~~~ rights associated with ownership of land and all permanent attachments to land.
*used interchangeably with real estate
personal property
✓ ~~~ objects that are moveable and not permanently attached to the land/structure,
including furniture and tenant fixtures that are often purchased along w/ real property
acquisitions.
acre
✓ ~~~ 1 acre = 43,560 sq ft
640 acres = 1 sq mile
user markets
✓ ~~~ when users are competing for PHYSICAL locations/spaces
capital markets
✓ ~~~ FINANCIAL sector of the economy that allocates financial resources among
households/firms that require funds
- participants invest in stocks, bonds, etc. to receive a fin. return on their investment
capital market: equity interests
, ✓ ~~~ owners of the real estate
- these people get their ROI through rent, price appreciation, etc.
capital market: debt interests
✓ ~~~ the lenders
- hold claims to interest on the borrowed funds that people use to invest, etc.
capitalization rate
✓ ~~~ ratio of a property's annual net income from rental operations to it's value
txtbk def: the percentage that is obtained when the income produced by a property
(or a specified interest in a property) is divided by the value or sale price of the
property (or the specified interest in the property).
role of government in real estate
✓ ~~~ - local govt has the most influence
- state govt has the least effect
- national govt also has significant impact
how does the national government influence real estate?
✓ ~~~ through income tax and housing subsidy programs
how is RE unique?
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