Exam (elaborations)
AYOP PRINCIPLES OF REAL ESTATE 1
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AYOP PRINCIPLES OF REAL ESTATE 1
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AYOP PRINCIPLES OF REAL ESTATE 1Fixity - Answers-land and buildings and other improvements to land require long periods
of time to pay for themselves(investment permanence)
Situs - Answers-location preference from an economic standpoint rather than
geographical
Economic Characteristics of Land - Answers-scarcity, modification, fixity, situs
3 physical characteristics of land - Answers-non-homogeneity, immobility, and
indestructibility
Texas Real Estate License Act - Answers-Passed in 1949 and created TREC. It consist
of 9 members, 6 Brokers & 3 General public members; appointed by the governor and
approved by 2/3 of the senate present
5th Amendment - Answers-states that a citizen cannot have property taken from them
w/o due process of law or just compensation
Ordinance - Answers-a local law
Capital Gains Tax - Answers-a tax levied on the returns that people earn from capital
investments, like the profits from the sale of stocks or a home
Fair Housing Act - Answers-The federal law that prohibits discrimination in housing
based on race, color, religion, sex, handicap, familial status, and national origin
Real Estate Settlement Procedures Act (RESPA) - Answers-Federal law that ensures
that residential buyers and sellers receive full disclosure of all settlement charges
National Association of Realtors - Answers-largest trade group, founded in 1908
Methods of Property Valuation - Answers-Assessed value, estimated sales value,
investment value, replacement value
Assessed Value - Answers-Value established for tax purposes by local
municipalities(market value)
Estimated Sales Value - Answers-found by examining sales prices of comparable
properties recently sold in the area
Investment Value - Answers-the value of the property to a particular investor
Replacement Value - Answers-amount it would cost to replace a property(insurable
value)
, Liquidation Value - Answers-an estimated amount that could be gained if the property
was quickly sold in a low-demand market(auction, foreclosure)
Mixed-Use Development - Answers-development that combines housing and
businesses in one area
Modular Home - Answers-Units that are constructed in factories off-site according to
state building codes. Once assembled on the home site, it is immediately considered to
be real property.
Timeshare Home - Answers-second/vacay home that several owners use for certain
periods throughout the year, can exchange times w/ other properties
Tax Deduction - Answers-A donation or expense that lowers taxable income
Tax Credit - Answers-An amount subtracted directly from the tax owed
Points - Answers-fees charged by the lender to "buy down" the interest on a mortgage
loan. Each point is 1/8 or 1/4 of 1% of the loan amount.
Loan Origination Fee - Answers-A fee charged to the borrower by the lender to cover
processing fees
Capital Gains - Answers-increase in value of a capital asset from the time it was bought
to the time it was sold. Short-term= assets sold within a year. Long-term= sold after a
year and taxed a lower tax rate.
Capital Loss - Answers-the difference between a lower selling price and a higher
purchase price
Fair Market Value - Answers-the price a willing buyer would pay a willing seller in a free
market
Mortgage Interest - Answers-interest paid on owner's first and second homes that is tax
deductible
First Time Homebuyer Tax Benefit - Answers-may withdraw up to $10,000 and others
may contribute another $10,000 w/o penalty
Estate Tax Exemption - Answers-amount an individual can leave to their heirs w/out
paying tax
Homeowners insurance usually does not cover... - Answers-flooding, earthquakes,
pests, frozen pipes, wear/tear, wind/hail damage to trees, and mold
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