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Definition
| Financial Institutions Reform, Recovery & Enforcement Act 0f 1989 |
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| Uniform Standards of Professional Appraisal Practice |
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| Professional Appraisal Organization |
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| Restricted Use, Summary and Self-Contained Report |
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| Real Property Vs. Real Estate |
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Definition
| Real Estate is bricks and mortar, while Real Property includes rights and interests |
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| Distinctions between Price, Cost & Value |
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Definition
Price: Agreed price between buyer and seller
Cost: How much to build
Value: Opinion |
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| Most prevalent types of Value |
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Definition
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| 4 Factors that create Value |
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Definition
| Utility, Scarcity, Desire & Effective Purchasing Power |
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| Land, Labor, Capital & Entrepreneurial Coordination |
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| Anticipation & Change, Supply & Demand, Substitution |
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| 4 Forces that Influence Real Property |
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Definition
| Social, Economic, Environmental & Government |
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Definition
| Identify characteristics of the Appraisal |
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| What is the most important principle in the Sales Comparison Approach |
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Definition
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| What is the most important principle in the Income Capitalization Approach |
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| That which is contrary to what exists but is supposed for the purpose of analysis |
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| Define the extent & type of analysis |
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| What are the 4 Government Powers |
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Definition
| Police, Taxation, Eminent Domain, Escheat |
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| Legal Entity Ownership of Real Property |
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Definition
| LLC is the best, limits liability and taxation |
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Term
| 3 Major Economic Interests |
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Definition
| Legal, Physical and Financial |
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| Partial Interests (Vertical Ones) |
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| Difference between Money Market and Capital Market |
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| Money Market is short term debt (overnight paper) while capital markets are a source of long term debt |
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Definition
| London Interbank Offering Rate (Libor + Spread) |
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| Mortgage Interest Rates (Yield Spread) |
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Definition
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| Consumer Price Index (CPI) |
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Definition
| Used in commercial lease escalations |
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| Prime Rate (Home Equity Loans) |
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Definition
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Definition
| rated by the rating agencies |
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| Minimum Investment Grade Rating |
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Definition
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| Population and Geographic distribution |
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| How do you calculate real estate taxes |
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Definition
| Tax Rate * Tax Assessment |
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| What is Competitive Supply? |
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Definition
| Inventory that competes with the subject property |
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| Area for which the subject property draws people |
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| What is the Life Cycle of a Market Area? |
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Definition
| Growth, Stability, Decline & Revitalization |
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| Evidence of Transition in Market Area |
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Definition
| Different Uses, Intensifying uses, Old to new, Supply and Demand Imbalance |
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| What are the 3 methods to Achieve Legal Description of Land? |
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Definition
Block and Lot
Rectangle Survey System
Meets and Bounds |
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Definition
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| What does LEEDS stand for? |
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Definition
| Leadership in Energy and Environmental Design |
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| Americans with Disabilities Act of 1990 |
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Definition
| Public Accommodation where economically feasible |
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| What is the difference between Market Study and Marketability? |
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Definition
| Market Study focuses on the demographics to determine what should be built and Marketability refers to the sales potential of the subject property |
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| What is a Feasibility Analysis? |
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Definition
| Economic feasibility is achieved when the market value of a property equals or exceeds all costs of production. This analysis determines values of potential use. |
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| What are the 4 Tests for Highest & Best Use? |
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Definition
| legal permissibility, physical possibility, financial feasibility, and maximum profitability. |
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| What is the difference between Financially Feasibility and Maximum Productivity? |
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Definition
Financial feasibility is based on supply and demand – finding out who the competition is and who are the potential buyers, tenants and customers.
For income property, figuring out the highest rate of return might involve studying several alternatives and design configurations. |
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| What is the difference between Legally NonConforming and Non-Complying Uses? |
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Definition
| Non-conforming has to do with a use that is grandfathered in, while non-complying has to do with being overbuilt |
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Term
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Definition
| Something the land is used for before it is used at its highest and best use (to pay taxes) |
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Term
| What is the preferred approach to land valuation? |
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Definition
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Term
| What are the 7 steps to the Cost Approach Procedure? |
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Definition
| Land, Construction, depreciation, etc.. |
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Definition
| Cost to Duplicate a property |
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Definition
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| What are the 3 major types of depreciation? |
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Definition
| Physical, Functional and External |
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| What are the 3 traditional cost estimating methods? |
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Definition
| Comparative Unit Method, The Unit-in-place Method and The Quantity Survey Method |
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Term
| What are the methods used to Estimate Depreciation? |
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Definition
The Age-Life Method
The Market Extraction Method
The Breakdown Method |
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