Real Estate Management Exam 1 Study Guide Exam Questions with Answers, Exams of Business Economics

Download Real Estate Management Exam 1 Study Guide Exam Questions with Answers and more Exams Business Economics in PDF only on Docsity! Real Estate Management Exam 1 Study Guide Exam Questions with Answers Property Management - Correct Answer -Marketing -Leasing -Maintenance -Financial: how often property managers meet to speak financials -Planning: how to change & adapt buildings for future use Current Issues that impact real estate Management - Correct Answer -Security issues -False Identities -Environmental issues -Aging of population: the demand on the type of space wanted -Technology: GPS tracking on your phone now clocks you in and out for appointments -Government involvement: zoning laws, tax codes History - Correct Answer Prior to the 1900's there wasn't any property management going on at all really. Prior to the 1900s -Residential - Correct Answer If you wanted to own your own home you built it. If you didn't have money to build, then you lived in a boarding house. Similar to small apartments these days, like renting. Only for those who couldn't afford to own. People didn't borrow money. Back then people who rented were seen to have bad morals. Prior to the 1900s -Commercial & Industrial - Correct Answer There was no need for property management because companies weren't that big. Business loans were available, real estate loans however were highly frowned upon. Things changed after the industrial revolution - Correct Answer Factories became a lot bigger, needing more space. More space required more money so owners started asking for money. Bigger factories required more workers, more workers meant that workers wanted to live close to work so then owners built homes near the factory which then turned into communities. After a while, apartments became popular. This brought about property management. When skyscrapers came into play, with steal buildings, property management became heavily needed. The Otis Elevator - Correct Answer Brought about property management as well. Wood buildings with a lot of stories turned people off. With steal buildings it took a while for the elevator to be accepted. Heating buildings & electricity - Correct Answer Back then houses had lights due to pipes that gas ran through and you lit a match. Horse hair and newspaper was your insulation. 1900s to 1920s technology change - Correct Answer 1930s lenders were more willing now to give some money to contribute building homes. Great Depression! Homes foreclosed. Banks rented them out. But sometimes the original then rented it out because no one was able to buy homes. Apartment units also went foreclosed. Banks then were in charge of lots of real estate. Banks didn't want that responsibility. So they hired accountants to take charge of buildings. The Great Depression somewhat is the reason for the true becoming of property management. Profession: Property Management 1907: The National Association of Building Owners & Managers - Correct Answer Owners who manage their own buildings who wanted to trade secrets when situations happened. Profession: Property Management 1907: The National Association of Real Estate Agents - Correct Answer Focused on selling In 1923 decided to form a management division In 1933 they formed their own group to try to be top dog over the other association (IREM) -Institute Real Estate Management Big Changes after WWII - Correct Answer Late 40s early 50s developed the suburban apartment complex A motel industry then started - holiday inn became known A change in retail as well - malls become about in the late 50s and early 60s The mindset of bigger is better started developing & wanting competition with other companies -The benefit of choice 1960s: Legal change that causes shift - Correct Answer 1963 the condominium form of ownership became legal & thus a drastic shift in property management 1982 - Correct Answer The government took away the depreciation law so by the late 1980s people were giving back their buildings because they didn't want them anymore so there was a mini financial collapse. 1990s - Correct Answer big changes in technology. Providing rent for space. Roof tops started providing income because cellular antennas became popular. Started offering dish and cable TV. Property management got involved in fax machines. FedEx and UPS came into play, and started making profits that created value to buildings. 2000s to 2010 - Correct Answer securities have the biggest impact on property management. The USA patriot act. Property managers had to use appropriate tools There are 5 parts: Basic components -name of the parties, Time frame, Reason for cancellations, the relationship between owner and company Part 1 of the Management Agreement - Correct Answer Financial Responsibilities - Set up bank accounts, bank account: operating account -deposit rent to pay all the expenses, Another account - security deposits, set up to who earns income off to those accounts, overdue rent procedures, establishing promotions and discounts & establishing rates, pay all the operating expenses, setting up finial budgets, set up steps for audit, reports to owners. Part 2 of the Management Agreement - Correct Answer General Property Management - Marketing the building, Budget the market, executing the residential lease: when tenants sign that everything is legit, executing commercial leases, build- out expenses, make sure there's appropriate staff available to implement the leases Part 3: - Correct Answer Managing Maintenance Daily Maintenance Monthly maintenance Seasonal maintenance Capital maintenance Part 4: Owner's Obligation - Correct Answer must communicate their goals and policies, Owner's obligation to comply with all laws, insuring the property, maintaining the reserve account. Part 5: Compensation - Correct Answer Most property management companies get a percentage or fixed amount Management Plan: Step 1: - Correct Answer Analyze the current status of property in relationship to the owner's goals & your obligations A current physical list of inspection & inferred maintenance Current physical condition - the financials, rent that's below market rate Operational conditions -owner wants to cut back on the operational expenses Current staff -"kind of like a new football coach taking over a new program" making staff adjustments *AFTER YEAR 1 YOU SKIP STEP 1 Management Plan: Step 2: - Correct Answer Look at the national analysis -anything nationally going on that could impact our performance EX: wars, oil embargo Management Plan: Step 3: - Correct Answer Regional Analysis -you look at your industry more regional to your company -Local economic factors, population Management Plan: Step 4: - Correct Answer Metropolitan or City Analysis -Issues Government, Economic Management Plan: Step 5: - Correct Answer Neighborhood -You have to calculate this every year in your management plan EX: a new complex coming in means new competition, street closures Overall level of maintenance in the neighborhood -a dated facility Management Plan: Step 6: - Correct Answer Property Analysis -clear basis on what you are working with, it sets the bar for the first year Improvements to the site: Horizontal - Correct Answer Parking lots, landscaping, exterior signs Safety/Compliance issues Improvements on the site: Vertical - Correct Answer Building improvements, roof, mechanicals, appliances, windows, painting, floors, safety issues, functionality - meeting current trends Management Plan: Step 7: - Correct Answer Market Analysis -analysis of competing properties Raise or lower rent compared to other surrounding buildings Management Plan: Step 8: - Correct Answer Analysis of Alternatives -suggestions for changes in operations, sometimes changes in use EX: Changes the vendors that you work with, potential changes in the way the leases are written up Operational changes Structural changes Potential change in use