1. What is a 'contingency′ in a real estate contract?
A. A mandatory property insurance policy.
B. A condition that must be met for the contract to be binding.
C. A discount applied to the property price.
D. A clause that automatically renews the contract.
2. What does 'cap rate′ (capitalization rate) measure in commercial real estate?
A. The property′s appreciation over time.
B. The annual rate of return on a real estate investment based on its income.
C. The cost of capital improvements to a property.
D. The total cost of acquiring a property, including financing.
3. What is 'capital gain′ in real estate investment?
A. The original purchase price of a property.
B. The profit from selling a property for more than its purchase price.
C. The annual rental income from a property.
D. The cost of property maintenance and repairs.
4. Which of these is NOT typically considered 'real property′?
A. Land
B. Buildings
C. Furniture
D. Mineral Rights
5. What is 'seller′s market′ in real estate?
A. A market where property values are decreasing.
B. A market where there are more buyers than available properties.
C. A market where interest rates are low.
D. A market regulated by strict government controls.
6. What is 'rent control′?
A. Government regulations limiting the amount landlords can charge for rent.
B. Insurance that tenants purchase to cover their belongings.
C. A clause in a lease agreement allowing rent increases annually.
D. The process of negotiating rent between landlord and tenant.
7. What does 'escrow′ mean in the context of real estate transactions?
A. A type of property insurance.
B. A neutral third party holding funds and documents until conditions are met.
C. The process of inspecting a property for defects.
D. A government tax on real estate sales.
8. Which professional is licensed to negotiate and transact the sale of real estate on behalf of others?
A. Property Manager
B. Real Estate Appraiser
C. Real Estate Agent
D. Home Inspector
9. Which term refers to the estimated worth of a property, often determined by a professional?
A. Appraisal
B. Depreciation
C. Equity
D. Amortization
10. In real estate, 'brownfield′ refers to:
A. Newly developed green spaces in urban areas.
B. Previously developed land that may be contaminated.
C. Agricultural land ready for residential development.
D. Undeveloped natural areas preserved for conservation.
11. What is 'leverage′ in real estate investing?
A. The legal restrictions on property development.
B. Using borrowed capital to increase the potential return of an investment.
C. The process of negotiating a lower property price.
D. The physical maintenance and upkeep of a property.
12. The term 'fixture′ in real estate refers to:
A. Temporary decorations in a home.
B. Personal property included in a sale.
C. Items permanently attached to the property.
D. Portable appliances in a kitchen.
13. What is the document that transfers ownership of real property from one party to another?
A. Lease Agreement
B. Deed
C. Mortgage
D. Promissory Note
14. What is the difference between 'market value′ and 'assessed value′?
A. They are the same and used interchangeably.
B. 'Market value′ is the estimated price a property would sell for, while 'assessed value′ is used for property taxes.
C. 'Market value′ is used for tax purposes, and 'assessed value′ is the selling price.
D. 'Market value′ is for commercial properties, and 'assessed value′ for residential properties.
15. What is 'property management′?
A. The process of valuing properties for sale.
B. The overseeing of residential, commercial or industrial real estate on behalf of an owner.
C. The legal process of transferring property ownership.
D. The insurance against property damage and liability.
16. What is 'PMI′ (Private Mortgage Insurance)?
A. Property Maintenance Inspection
B. Primary Market Index
C. Private Mortgage Insurance
D. Public Mortgage Investment
17. What is a '1031 exchange′ in US real estate law?
A. A tax on property sales.
B. A method to defer capital gains taxes when selling and reinvesting in 'like-kind′ property.
C. A government program for first-time homebuyers.
D. A type of property insurance for commercial buildings.
18. What is the purpose of a 'title search′ in real estate?
A. To determine the market value of a property.
B. To inspect the physical condition of a property.
C. To examine the history of property ownership and identify any claims or encumbrances.
D. To negotiate the selling price of a property.
19. What does 'walkability′ score of a neighborhood indicate?
A. The crime rate in the area.
B. How easily residents can access amenities on foot.
C. The quality of schools in the district.
D. The market value appreciation potential of properties.
20. Which of these factors is LEAST likely to affect property value?
A. Location
B. Interest rates
C. Color of the front door
D. Local amenities and schools
21. Which term describes the process by which a bank repossesses a property due to mortgage default?
A. Eviction
B. Foreclosure
C. Depreciation
D. Amortization
22. What does 'HOA′ stand for in real estate?
A. Home Owners Association
B. Housing Opportunity Administration
C. Homestead Organization of America
D. House Operating Agreement
23. What does 'ROI′ stand for in real estate investment?
A. Rate of Interest
B. Return on Investment
C. Real Opportunity Index
D. Risk of Investment
24. What does 'due diligence′ mean in real estate transactions?
A. The initial offer price for a property.
B. A thorough investigation to verify facts and details of a property.
C. The process of obtaining a mortgage pre-approval.
D. The final walkthrough before closing.
25. In real estate, 'amortization′ primarily refers to:
A. The decrease in property value over time.
B. The process of paying off a loan over time with regular payments.
C. The initial down payment on a property.
D. The annual property taxes.
26. What does 'curb appeal′ refer to in real estate?
A. The interior design and decor of a house.
B. The attractiveness of a property from the street.
C. The structural integrity of the foundation.
D. The energy efficiency of the building.
27. In a lease agreement, what is the 'lessee′?
A. The property owner.
B. The tenant who rents the property.
C. The real estate agent.
D. The mortgage lender.
28. What is 'zoning′ in real estate and urban planning?
A. The process of property valuation for tax purposes.
B. Regulations dividing land into districts based on permitted uses.
C. The historical record of property ownership.
D. Insurance coverage for property damage.
29. What is a 'lien′ on a property?
A. A type of home insurance policy.
B. A legal claim against a property as security for a debt.
C. A discount on the property′s sale price.
D. An environmental inspection report.
30. What is 'net operating income′ (NOI) in real estate finance?
A. The total revenue before expenses.
B. The annual income generated by a property after deducting operating expenses but before mortgage payments and taxes.
C. The profit after all expenses including mortgage and taxes.
D. The initial investment in a property.
