Texas SAE Real Estate Investment Exam Latest Update Questions and Verified Correct Answers Guaranteed A+ A hot market (aka seller's market) has the opposite effect - Correct Answer:due to high demand, low inventory, and rising prices.
A property's assessed value is - Correct Answer:what the local taxing authority thinks a property is worth.
Active real estate investing comes in three "flavors." - Correct Answer:Fix and flip Buy and hold Wholesaling
An investment strategy has bearing on - Correct Answer:which valuation type is more relevant to an investor.
Anticipation says that - Correct Answer:a property's value is the total sum anticipated future benefits in today's dollars.
any real estate investment should include - Correct Answer:an analysis of the
governmental regulations that will affect it.
Building codes and inspections are a major consideration contributing to - Correct
Answer:both project time and costs.
Buy and Hold Strategy - Correct Answer:Requirements include: Capital for purchase Ability to cover debt with rental income during holding period
Risks include: Vacancies
Cash flow shortages Property value decline Tenant issues
capital preservation - Correct Answer:Real estate investment is considered a hedge against inflation because property values typically rise over time.During the ownership period, equity builds and the property value increases. In contrast, a renter will never see the money paid to the landlord again. If the investor's goal is to make a profit, the capital used to purchase the property is preserved while it earns.
Characteristics of the Texas Real Estate Market - Correct Answer:Real estate is an uncentralized market that's slow to respond to changes in supply or demand, and it's highly influenced by governmental policy.
Commercial - Correct Answer:Retail 1 / 2
Office Space
Competition is - Correct Answer:related to supply and demand. Multiple similar
properties on the market creates competition, causing a value decrease because the supply exceeds demand. Less competition increases demand and drives pricing upward.
Conformity - Correct Answer:that value is created and maintained when a property's characteristics conform to (fit in with) its neighborhood.
Contribution has to do with - Correct Answer:how alterations to a property impact its value as a whole.
Demand and price move in the same direction - Correct Answer:If demand is up, the price goes up. If demand is down, the price goes down.
Environmental and Development Controls - Correct Answer:Environmental controls
Any new project will need to receive an environmental review and approval from various governmental agencies. Pressures to develop in sustainable ways mean more laws to understand and follow. Regulations also affect the sale of existing properties, from simple environmental hazard disclosures, to requirements for equipment that preserves or protects the environment.Development regulations Property developers must follow local regulations regarding density, infrastructure, traffic patterns, and the capacity of public services, to name a few. These are the regulations that ensure new developments are consistent with a city's general plan for zoning, and they not only influence, but determine, acceptable property use in an area.
Environmental regulations affect the sale of existing properties - Correct Answer:from simple environmental hazard disclosures, to requirements for equipment that preserves or protects the environment.
Every piece of real estate is unique due to - Correct Answer:its specific location, variances in construction, and level of wear and tear. This describes the characteristic of uniqueness.
Financial influences - Correct Answer:Taxes: Real estate investments are likely to be taxed not only on their profits, but also on the property itself.
Federal control of money:
The actions of the Federal Reserve Board will affect both the mortgage cost and supply.
Fix and flip - Correct Answer:Requirements include: Working capital for the purchase and repairs Priced low enough to cover costs of repairs, holding period, marketing, closing costs, and profit Remodeling skills
- / 2