Intro to Modern Real Estate
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Intro to Modern Real Estate - Leaderboard
Intro to Modern Real Estate - Details
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| Education Standards Advisory Committee: | The entity within the Real Estate Commission that is responsible for making education requirement decisions is the Education Standards Advisory Committee. The committee consists of 12 members appointed by the commission. Members of the committee serve staggered two-year terms. The terms of the committee members expire as follows: 1. On December 31 of each even-numbered year, the terms of four license holder members and two education members expire. 2. On December 31 of each odd-numbered year, the terms of three license holder members and two education members expire and the public member expires. |
| Education Standards Advisory Committee: | The entity within the Real Estate Commission that is responsible for making education requirement decisions is the Education Standards Advisory Committee. The committee consists of 12 members appointed by the commission. Members of the committee serve staggered two-year terms. The terms of the committee members expire as follows: 1. On December 31 of each even-numbered year, the terms of four license holder members and two education members expire. 2. On December 31 of each odd-numbered year, the terms of three license holder members and two education members expire and the public member expires. |
| Education Standards Advisory Committee: | The entity within the Real Estate Commission that is responsible for making education requirement decisions is the Education Standards Advisory Committee. The committee consists of 12 members appointed by the commission. Members of the committee serve staggered two-year terms. The terms of the committee members expire as follows: 1. On December 31 of each even-numbered year, the terms of four license holder members and two education members expire. 2. On December 31 of each odd-numbered year, the terms of three license holder members and two education members expire and the public member expires. |
| Education Standards Advisory Committee: | The entity within the Real Estate Commission that is responsible for making education requirement decisions is the Education Standards Advisory Committee. The committee consists of 12 members appointed by the commission. Members of the committee serve staggered two-year terms. The terms of the committee members expire as follows: 1. On December 31 of each even-numbered year, the terms of four license holder members and two education members expire. 2. On December 31 of each odd-numbered year, the terms of three license holder members and two education members expire and the public member expires. |
| Property Classifications | Residential, residential income, office, retail, industrial, farm & ranch, special purpose buildings (for example, recreational facilities, government buildings, churches, schools), land |
| Property Classifications | Residential, residential income, office, retail, industrial, farm & ranch, special purpose buildings (for example, recreational facilities, government buildings, churches, schools), land |
| Property Classifications | Residential, residential income, office, retail, industrial, farm & ranch, special purpose buildings (for example, recreational facilities, government buildings, churches, schools), land |
| NA | NA |
| Market interaction | 1. Market: transaction arena where suppliers and demanders define value through the price mechanism. 2. If supply increases relative to demand, price decreases, and if demand increases relative to supply, price increases. |
| Market interaction | 1. Market: transaction arena where suppliers and demanders define value through the price mechanism. 2. If supply increases relative to demand, price decreases, and if demand increases relative to supply, price increases. |
| Market interaction | 1. Market: transaction arena where suppliers and demanders define value through the price mechanism. 2. If supply increases relative to demand, price decreases, and if demand increases relative to supply, price increases. |
| Market interaction | 1. Market: transaction arena where suppliers and demanders define value through the price mechanism. 2. If supply increases relative to demand, price decreases, and if demand increases relative to supply, price increases. |
| Forms of specialization include: | 1. Property type: residential, commercial, industrial, land 2. Geographical area: defined by natural barriers, streets and highways, or subdivisions 3. Type of transaction: sales, leases and subleases, exchanges, and options |
| Forms of specialization include: | 1. Property type: residential, commercial, industrial, land 2. Geographical area: defined by natural barriers, streets and highways, or subdivisions 3. Type of transaction: sales, leases and subleases, exchanges, and options |
| What property-related functions do real estate professionals perform? | 1. Creation and improvement involves capital formation, financing, construction contracting, and regulatory approvals. 2. Management and maintenance: involves property managers and asset managers. 3. Demolition 4. Investment ownership 5. Regulation of usage, taxation, and housing administration 6. Transfer |
| Specializations: Brokers and Agents | A broker is a direct agent of the principal who is hired for compensation to perform a stated service, such as negotiating the sale of property. An agent is the party in an agency relationship who is hired by the principal to perform certain duties. |
| Specializations: Property Managers | Property managers are responsible for finding tenants for properties, collecting rent, rehabbing space for tenants or constructing new space, ordering repairs, and overall maintaining of their properties. |
| Specializations: Title and escrow companies | A title company completes an "abstract of title," which is a search of the records in the county where the property is held. Escrow companies hold money or documents until certain terms and conditions of the escrow are met. |
| Specializations: Mortgage brokers | Mortgage brokers are paid a fee to bring borrowers and lenders together. Lenders, bankers, insurance companies, appraisers, attorneys, inspectors, surveyors, counselors, educators |
| 3 Property Type Specializations | Residential property, commercial property and Investment property |
| Property Classifications | Residential, residential income, office, retail, industrial, farm & ranch, special purpose buildings (for example, recreational facilities, government buildings, churches, schools), land |
| Professional organizations | Promote the interests of practitioners and enhance their professional standards. |
| Professional Organizations | Members of the National Association of REALTORS (NAR) are known as REALTORS. Salespersons not associated with NAR are known as real estate licensees or agents. Members of the National Association of Real Estate Brokers are known as Realtists. |
| Real Estate Brokerage: | Procuring a buyer/tenant for an owner or landlord or vice versa. |
| Knowledge needed in real estate: | Local market, license laws, closing procedures, etc. |
| Skills needed in real estate | Time management, market analysis, selling, writing, etc. |
| Forms of specialization include: | 1. Property type: residential, commercial, industrial, land. 2. Geographical area: defined by natural barriers, streets and highways, or subdivisions. 3. Type of transaction: sales, leases and subleases, exchanges, and options. 4. Type of client: many brokers restrict their business to representing either buyers and tenants or sellers and landlords exclusively. 5. Type of relationship. 6. By form of business organization: specializing in one type of client. 7. By form of client relationship: advisory vs. transaction based. |
| Real Estate Law | Federal statues, state statues, a body of court decisions (common law), and local agencies circumscribe how people can develop, manage, and transfer real estate. |
| Real Estate Law | 1. The National Association of REALTORS Code of Ethics sets an even higher standard of performance for member brokers and agents. 2. The Association of Real Estate License Law Officials (ARELLO) is an international association of real estate regulators that promotes consistent policies and standards for license law and enforcement of license law. 3. Texas Real Estate Commission (TREC) is charged with administering and enforcing license laws as well as passing regulations that further refine or clarify state statues. It is responsible for administering The Real Estate License Act (TRELA). TREC has the power to create and enforce new rules to help interpret or define TRELA, but cannot amend the law. |
| Price and value | 1. Price mechanism: quantified value of an exchange. 2. Value components: desire, utility, scarcity (availability in relation to demand), purchasing power (the consumer's ability to pay for the item) |
| Productivity and costs | 1. Cost plus profit equals minimum price 2. Production costs influence the value to the consumer 3. Essential production costs are the costs of capital, materials, and supplies, labor, management, and overhead. |
| Market interaction | 1. Market: transaction arena where suppliers and demanders define value through the price mechanism. 2. If supply increases relative to demand, price decreases, and if demand increases relative to supply, price increases. |
| Market Equilibrium | 1. Market equilibrium: price, cost, value theoretically the same. 2. Changes in supply or demand cause market imbalances, resulting in an equilibrium time lag. Supply and demand tend toward balance when they are equal. |
| Supply | Goods or services available for sale, lease, or trade. |
| Demand | Goods or service desired for purchase, lease, or trade. |
| Economic characteristics of real estate | 1. Governed by supply, demand, price, costs, value components, government influence. 2. Inherent value, unique appeal, immovable supply, illiquid (cannot always be readily sold for cash), slow response to cycles, decentralized, local market. |
| Supply, demand, and price interact continuously in a market | The dynamics of value and the costs of producing goods and services influence these forces. A market tends toward a state of market equilibrium in which supply equals demand and price, cost, and value are identical. |
| Supply: | 1. Property available for sale/lease that is measured according to property classification: dwelling units (residential), square feet (commercial/industrial), and acres (agricultural). Influenced by costs (labor), availability of financing, investment returns, and government and community regulation and planning. |
| Demand | 1. Property buyers and tenants wish to acquire that is measured in households (residential), square feet (commercial/industrial), and acres (agricultural). |
| Supply and demand are influenced by: | Residential: quality of life/neighborhood, amenities, price/facility convenience. Retail: trade area, sales, competition, site access, visibility, growth patterns. Office: efficiency, costs of occupancy, functionality. Industrial: functionality, labor pool availability, regulatory compliance, supplies, distribution channels. |
| Base Employment: | 1. the number of persons employed in the businesses that represent the economic foundation of the area. |
| Total employment | Includes base, secondary, and support industries. Total employment creates a demand for a labor force. |
| If employment and population increase, demand and prices increase. If they decrease, the opposite occurs. Supply-demand indicators are price, vacancy, and absorption. | Vacancy: Is existing, unoccupied supply. Absorption: Is the “filling up” of vacancy. |
| Real estate supply-demand cycle: | 1. Undersupply 2. Accelerated construction adds supply 3. Equilibrium 4. Construction adds more supply 5. Oversupply 6. Construction stops 7. Equilibrium 8. Demand absorbs supply 9.****Undersupply (repeats) |
| Market influences on supply and demand: | 1. Local economic factors. 2. National economic trends in money supply, inflation 3. Government regulation at all levels |
| The Texas Real Estate Commission (TREC) | Was created to enforce license law and enact rules and regulations to support the law. |
| Members of the commission include 9 board members: | 6 members from real estate industry and 3 members from the general public. The governor appoints them. If a person or their spouse is registered, certified, or licensed by an occupational regulatory agency in the industry, they are deemed ineligible. One term is 6 calendar years. |
| The commission must: | 1. Administer Chapter 1101 and Chapter 1102. 2. Adopt rules and establish standards relating to permissible forms of advertising by a license holder acting as a residential rental locator. 3. maintain a registry of certificate holders. design and adopt a seal. The commission in the course of conducting hearings and investigations is empowered to issue subpoenas |
| The Texas Real Estate License Act (TRELA): | Establishes a Real Estate Recovery Fund for the protection of the public against harmful actions by licensees. The TREC maintains and administers the fund. |
| A license fee: | Charged in order to obtain a balance in the trust fund of $1.7 million. |
| Claim for payment from trust account: | Upon order of the court, an aggrieved party may proceed to collect from the licensee. If the licensee cannot pay the full amount, the party may apply to the court for an order. The order directs the court to pay the balance due from the real estate recovery fund. |
| Claim for payment from trust account 2: | Payments from the trust account for claims arising out of a single transaction may not exceed a total of $50,000, regardless of the number of claimants. Payments from the trust account for claims based on judgments against a single licensee may not exceed a total of $100,000. |
| Who can broker or sell? | Unless specifically exempted, anyone who acts or claims to act in any way as a real estate broker or salesperson in the state of Texas must first obtain the proper license from the Texas Real Estate Commission. |
| What is a broker? | A broker is an individual who performs certain real estate services for another party for compensation. The broker is the person ultimately responsible for the company’s activities, notably the activities of other licensees as well as the business's trust accounts. The broker is the party who employs other agents to carry out the firm’s business. |
| Who is a salesperson? | A salesperson is any licensed person who is associated with a licensed broker and performs certain real estate services |
| What about other people? | A person may invest in real estate or contract to purchase real estate and then sell it or offer to sell it without having a real estate license. A license is not required for a person to buy or sell real property only for the person’s own account. |
| A Teas real estate license is also not required for: | 1. Attorneys-in-fact acting under a power of attorney from an owner or lessor, to conduct a real estate transaction, provided the attorney in fact receives no fee or other consideration. 2. Attorneys-at-law providing legal services in the course of their duties as attorneys, licensed in Texas only. 3. An auctioneer licensed under Chapter 1802 while conducting the sale of real estate by auction, if the auctioneer does not perform another act of a broker or salesperson. 4. Receivers, trustees in bankruptcy, administrators, executors, or guardians while acting under court order or under the authority of a will or trust instrument. 5. A person employed by an owner in the sale of structures and land on which structures are located, if the structures are erected by the owner in the course of the owner's business. 6. Resident managers provided they reside on the premises and are engaged in leasing as a part of their employment. 7. Federal agency or state government officer/employee while conducting official duties. |
| A Texas real estate license is also not required for 2: | 8. An owner or the owner’s employee who leases the owner's real estate. 9. A partnership or limited liability partnership acting as a broker or salesperson through a partner who is a licensed broker. 10. A transaction involving the sale, lease, or transfer of a mineral or mining interest in real property, the sale, lease, or transfer of a cemetery lot, the lease or management of a hotel or motel, or the sale of real estate property under a power of sale conferred by a deed of trust or other contract lien. |
| In Texas, there are common requirements that both broker and sales applicants must meet: | 1. Be at least 18 years of age, a citizen of the U.S. or lawfully admitted alien, and a resident of Texas. 2. Satisfy the commission as to the applicant's honesty, trustworthiness, and integrity. 3. Demonstrate competence based on an examination Complete the required courses of study, including any required core real estate courses prescribed under this chapter. 4. Provide fingerprints to the Department of Public Safety within six months. 5. Complete a criminal history background check. 6. Pay appropriate fees. |
| In Texas, there are common requirements that both broker and sales applicants must meet 2: | In addition, there are specific licensing requirements for brokers and salespersons. The commission sets rules for how much and what kind of education licensees may take to renew their licenses. The commission may prescribe the title, content, and duration of continuing education courses that a license holder must attend to renew a license. The commission can also approve relevant educational experience and correspondence courses as a substitute for the required classroom attendance. |
| Education Standards Advisory Committee: | The entity within the Real Estate Commission that is responsible for making education requirement decisions is the Education Standards Advisory Committee. The committee consists of 12 members appointed by the commission. Members of the committee serve staggered two-year terms. The terms of the committee members expire as follows: 1. On December 31 of each even-numbered year, the terms of four license holder members and two education members expire. 2. On December 31 of each odd-numbered year, the terms of three license holder members and two education members expire and the public member expires. |