Real Estate Chapter 17
Terms
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- 5 objectives that motivate of investors
-
1. safety of principal
2. protection against inflation
3. Liquidity
4. increased income
5. tax advantages - An __________ is the outlay of an investor's money in anticipation of income or profit
- investment
- An investor uses some of his own money called ______ and ________ _____
- equity and borrowed funds
- Investors may choose to invest in real estate through a _______ ___________
- Limited Partnership
- this provides a means for individuals to pool resources for investment in a professionally managed portfolio of real property and must be purchased through a stockbroker
- (REIT) Real estate investment trust
- a lack of proper maintenance is referred to as ________ ___________
- deferred maintenance
- 5 advantages of investing in real estate
-
good rate of return
tax advantages
hedge against inflation
leverage
equity - _________ refers to the aiblity to sell an investment quickly without the loss of one's capital
- liquidity
- one of the external forces affecting a property are the _____ and ________ _________
- local and national economies
- the economic characteristic for the preference by people for a certain location._____
- situs
- give two examples of destination property
- banks and barbershops
- origin properties are _____ activities in any analysis of a community's economic base
- export
- appraisers and investors use square feet, front feet or acres as _____ __ __________
- units of comparison
- other physical characteristic of a site that deserve an investor's consideration are related to __________
- topography
- _________ _____ is the worth of a building to an individual investor based on their standards for reaching their goals
- investment value
- 3 considerations that influence a buildings investment value
-
exterior
interior
operating expenses - investors in real estate are investing in more than land buildings and equipment. they are investing in a bundle of _____ _______ and __________ _________
-
legal rights and
protected interests - ____ is the chance of losing all or part of an investment
- Risk
- ______ ____ is risk that can be transferred to an insurer
- static risk
- _______ ____ is risk that arises from the continual change in the business environment
- dynamic risk
- _________ is the use of borowed funds to finance the purchase of an asset
- leverage