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Basic Appraisal For Real Estate Broker
Basic Appraisal For Real Estate Broker
A building is depreciated at 2.5% per annum using the age life method. What is the estimated useful life of the building? 40 years
Using the 4-3-2-1 rule (depth rule) a 5-hectare belonging to different owners was sold for ₱ 10 000 000. What is the share of lot owners owning
the first quarter abutting the road? ₱ 4 000 000
The principle of value which states that the value of a property tends to be enhanced when there is reasonable homogeneity in use.
Principle of Conformity
An appraisal technique in which comparative estimates are made between prices paid in actual transactions and the current listings
Market Data Approach
This principle holds that when two or more commodities with substantially the same utility are available the one with the lowest price receives
the greatest demands and widest distribution. Principle of Competition
In the computation of depreciation of real properties, the method that is widely used by practitioners is the Age-Life Method Straight Line of
Depreciation
An appraisal principle which holds that the value of property tends to be enhanced by association with superior properties. Principle of
Progression
Several houses valued at ₱1000000 and ₱2 000 000 were built in an area where an existing house valued at ₱3 000 000 is located. As a result,
the value of the latter decreased. The real estate principle of value that applies to this situation is called the Principle of Regression
Investor s intending 2 buy a property which has annual income f ₱3600000. Has market study he finds out dt a comparable property w/ annual
gross income f ₱2500000 was recently sold 4 ₱17800000. Indicted by d comparable property @ how much should invest buy the subj
property?
₱25 632 000 (Based on Gross Income Multiplier)
Thee of the following factors create value in real estate. Which one does not create value?
A) demand
B) utility
C) infiltration
D) scarcity
Which of the following is never considered as a factor in the valuation of a house and lot?
A) modification in zoning regulations
B) topography of the lot
C) conviction of the previous owner on charges of moral turpitude
D) functional obsolescence
The increase in value of real estate without any expense of the owner is. Unearned Increment
Refers to that use which will yield the maximum return at a given time. Highest and Best Use
To be considered comparable to the subject property a comparable property must have been sold:
A) with a conventional mortgage
B) for all cash
C) without any form of secondary financing
D) for credit
E) in an arm's length transaction
The difference between the contract price and the loanable amount is. Buyer's Equity
Refers to the use an object is put to the services it renders and wants it satisfies. Utility
Method of finding land value in which all improvement costs (less depreciation) are deducted from sales price. Abstraction or Extraction
The number of years elapsed since the original structure was built. Actual Age or historical age or Chronological Age
A method of computing accrued depreciation in which the cost of a building is depreciated at a fixed annual percentage rate. Age-life method
or straight-line method
The process through which conclusions of property value are obtained. Appraisal
Approaches used in the appraisal of property. Cost Approach Income Approach and Market Data Approach
An appraiser's written opinion to a client of the value south for the subject property as of the date of appraisal giving all details of the appraisal
process. Appraiser's Report
A transaction which both buyer and seller act willingly n under no pressure w/ knowledge f d present conditions n future potential of d
property n in which d property has been offered on d open market 4 a reasonable length f time n there r no unusual circumstances. at Arm's
Length Transaction
Loss of value from forces outside the building or property such as changes in optimum land use legislative enactments that restrict or impair
property rights and changes in supply-demand relationships. Economic obsolescence external obsolescence
A building wall or fence that extends beyond the land of the owner and illegally intrudes on land of an adjoining owner or a street or an alley.
Encroachment
The age of a building based on the actual wear and tear and maintenance or lack of it that the building has received. Effective Age
The period of time during which a structure may reasonably by expected to perform the function for which it was designed or intended.
Economic Life
For appraisal purposes loss in value due to any cause including physical deterioration functional obsolescence and external obsolescence.
Depreciation
A statistical study f human population especially in reference 2 size density and population. Information therein s f particular importance 2
people involved in market analyses n highest n best use analyses in determining potential land uses f sites Demography
Prvsns n a deed lmtin d ftre uses f d prprty. Ds my tk any frm: Dy my lmt d dnsty f bldgs. dctte d typ f strctrs dt cn b erctd n prvnt bldgs. frm
bein usd 4 spec. prpses or usd @ al. Ds may impse a myriad f lmittns n cnditns afctin d prprty rgts apraisd.
Deed Restrictions
The principle that buildings should be similar in design construction and age to other buildings in the neighborhood to enhance appeal and
value
Principle of Conformity
The principle that a successful business attracts other such businesses which may dilute profits. Principle of Competition
The principle that no physical or economic condition ever remains constant. Principle of Change
Defects in a building or structure that detract from its value or marketability usually the result of layout design or other features that are less
desirable than features designed for the same functions in newer property. Functional Obsolescence
A lease of land only on which the lessee usually owns the building or is required to build as specified by the lease. Such leases are usually long-
term net leases the lessee's rights and obligations continue until the lease expires or is terminated by def. Ground Lease
Rent paid for the right to use and occupy land according to the terms of a ground lease. Ground Rent
The legally and physically possible use of land that is likely to produce the highest land (or property) value it considers the balance between
site and improvements as well as the intensity and length of uses. Highest and Best Use
An appraisal technique used to estimate the reproduction or replacement cost the appraiser multiplies the original cost of construction by a
price index for the geographic area to allow for price changes. Index Method
The lessor's interest and rights in the real estate being leased. Lease Fee
The lease’s right to possess and use real estate during the term of a lease. This is generally considered a personal property interest. Leasehold
An improvement to property that is more than warranted by the property's highest and best use and thus not likely to contribute its cost to
the total market value of the property. Over improvement
The subsequent increase in the unit value of a group of adjacent properties when they are combined into one property in a process called
assemblage. Plottage Value
A lease commonly used for commercial property that provides for a rental based on the tenant's gross sales at the premises. Percentage Lease
A lease that stipulates a base monthly rental plus a percentage of any gross sales exceeding a certain amount. Percentage Lease
The number of years of useful life left to a building from the date of appraisal. Economic Life
The current construction cost of a building having exactly the same utility as the subject property. Replacement Cost
The current construction cost of an exact duplicate of the subject building. Cost Reproduction New
A method of valuing land to be used for subdivision development. It relies on accurate forecasting of market demand including both forecast
absorption and projected gross sales
subdivision development method land development method
The rate at which properties will sell. Forecast Absorption
Total income that the project will produce. Projected Gross Sales
The basic appraisal premise that the market value of real estate is influenced by the cost of acquiring a suitable or comparable property.
Principle of Substitution
A principle that the value of a commodity will rise as demand increases and/or supply decreases. Principle of supply and demand
An improvement that is less than a property's highest and best use. Under improvement
The value of goods and services in exchange for other other goods and services or money in the marketplace an economic concept of market
value
Value in Exchange
The average selling price of homes in a district can be best ascertained by:
A) assessed value
B) an appraisal
C) comparative analysis
D) none of the above
Your client asked you to make a simple appraisal of his lot in Baguio. Based on the technical description and inspection of the property you
found out the following: Land area: 3200 sqm Unobstructed view (plus): 15% Plottage value (plus): 6% Topography.
The price of any commodity in its market at a specified time is called:
A) actual price
B) market price
C) Nobel price
D) par value
E) none of the above
is a kind of listing that can be given to more than 1 brokers. Open Listing
Open listing is a kind of listing that can be given to more than 1 brokers.
A _ is an agreement between an owner and a broker to sell a real estate property. Listing
A real estate broker receives a _ while a real estate dealer earns profit from his investments. Commission
A real estate broker receives a commission while a real estate dealer earns _ from his investments. Profit
The _ is a provision in the listing agreement which entitles a broker to a commission even when he closes the sale after the period of authority
provided that the buyer with whom he has negotiated was registered by him with the seller and during the. Hold Over Clause
In authority given by a developer to a broker to find a supplier for cement and aggregates materials wherein payment shall be in the form of
units or developed
the contract is _ .
_ is an agreement by which the listing broker is entitled to his broker's fee even if the principal/seller sold the property himself.
Exclusive Right to Sell / Exclusive Authority to Sell
A lot owner and developer may convert a property into a_ by executing a legal document called Master Deed and registering the same with
the Registry of Deeds. Condominium Project
A lot owner and developer may convert a property into a condominium project by executing a legal document called _ and registering the
same with the Registry of Deeds. Master Deed
A lot owner and developer may convert a property into a condominium project by executing a legal document called Master Deed and
registering the same with the _ . Registry of Deeds
Unless the condominium corporation is earlier dissolved. the life a condominium corporation is _ .
The document which provides guidelines rules and regulations regarding the rights of condominium unit owners in the use occupation
ownership and disposition of units is called _ Declaration of Restrictions
The required number of votes of registered owners to authorize a condominium corporation to sell or otherwise dispose of the common areas
in a condominium project is _. Simple Majority
Amendment to the Master Deed of a condominium project must be approved by the majority of registered unit owners. Majority is based on:
A) number of condominium units
B) floor area of ownership
C) total area of condominium units
D) any of the above
A petition may be filed by one or more-unit owners of condominium project when damage has rendered _ of the units untenantable and unit
owners holding more than 30% interest in the common areas are opposed to repair or restoration of the project. One-half or More
A petition may be filed by one or more-unit owners of condominium project when damage has rendered one-half or more of the units
untenantable and unit owners holding _ interest in the common areas are opposed to repair or restoration of the project. More than 30%
When the interest of participation of condominium unit owners in the common area is proportionate the formula applied is:
A) unit area divided by the total area of the common area
B) unit area divided by the total area of all condominium units
C) un
In the absence of any provision in the Master Deed of a condominium project the share of the unit owners in the common area is:
A) proportionate to his unit area
B) based on the value of his unit
C) equal to all other unit owners
D) decided by the
In mixed use condominium projects, the Master Deed may be amended by a simple majority of the unit owners. Majority is based on:
A) number of condominium units
B) floor area of ownership
C) total area of condominium units
D) any of the above
Amendment to the Master Deed of a condominium project approved by the majority of registered owners need also be approved by the _ and
HLURB. City/Municipal Engineer
Amendment to the Master Deed of a condominium project approved by the majority of registered owners need also be approved by the
city/municipal engineer and _ . HLURB
Per BIR 28-98 the ground floor of a condominium project shall be considered as_ and an additional rate of 20% shall be added to an
established residential zonal value. Commercial
Per BIR 28-98 the ground floor of a condominium project shall be considered as commercial and an additional rate of_ shall be added to an
established residential zonal value. 20%
All real properties regardless of actual use located in a street/barangay/zone the use of which are predominantly commercial shall be
considered as _ for purposes of zonal valuation. Commercial
Enumerated are the advantages of condominium concept which does not belong:
A) cooperative
B) with CCT as proof of ownership
C) enhances affordability
D) economy in land space
E) social club
For the purpose of ingress and egress a condominium unit owner has _ to the common area.
Non-Exclusive Easement
A_ is a part of a condominium project intended for any type of independent use or ownership. Unit
A unit is a part of a condominium project intended for any type of_ . Independent use or ownership
Whenever the_ in a condominium project are held by a condominium corporation such corporation shall constitute the management body of
the project. Common Areas
Whenever the common areas in a condominium project are held by a condominium corporation such corporation shall constitute the_ of the
project. Management Body
Statements defining the limitation of ownership of a condominium unit which binds all unit owners are called the_ and are registered with the
Registry of Deeds. Declaration of Restrictions
Statements defining the limitation of ownership of a condominium unit which binds all unit owners are called the Declaration of Restrictions
and are registered with the_ . Registry of Deeds
A right given for a consideration to purchase or lease a property upon a specified time. Option
A notice of adverse claim annotated on the title can be cancelled after the expiration of _ after its annotation by a verified petition with the
Registry of Deeds. 30 days
The best evidence of land/property ownership under the Philippine system of registration. Torrens Title
A condensed history of title showing the various links in the chain of title including liens encumbrances and other conditions affecting the title.
Abstract of Title
An annotation on the title which serves as a notice that the property is being held in reserve for whatever judgement may be rendered against
the owners. Attachment
When the owner's duplicate certificate of title is lost the registered owner shall file a _ to be issued a new owner's copy. Petition for the
Issuance of Owner's Duplicate Certificate of Title
The legal form to be made by the landowner in order to transfer the titles of the land and common areas in favor of the Condominium
Corporation. Deed of Conveyance
_ is an annotation on the back of a title that means that the property owned by the deceased is subject to the rights of _ or _ or any persons
who have been unduly deprived of their lawful participation in the estate with a period of _ after the settlement. Rule 74 of the Rules of Court
creditors heirs two (2) years
Under RA 6732 the _ of lost or destroyed original certificates of titles in the Registry of Deeds may be availed when the number of certificates
lost or destroyed is _ of all titles in the Registry but _ titles. Administrative Reconstitution at least 10% not less than 500
The best evidence of fee simple is a _ because it is indefeasible and imprescriptible. Torrens Title
The best evidence of fee simple is a Torrens Title because it is_ and imprescriptible. Indefeasible
The best evidence of fee simple is a Torrens Title because it is indefeasible and_ . Imprescriptible
An adverse claim lapses after _ from annotation in the certificate of land title. A second claim is _. 30 days not allowed
A claim of a person on a property of another. Adverse Claim
A hold or claim which one person has upon a property of another as security for a debt charge judgement or mortgages. Lien
An annotation in the title that serves as notice that the property is subject to a pending litigation. Lis Pendens
A lien created by law which exists in favor of persons who have performed or furnished materials in the erection or repair of a building.
Mechanic's Lien
Anything which affects or limits the fee simple title to property such as mortgages easements or restrictions of any kind. Encumbrance
Refers to money encumbrances that make the property security for the payment of a debt or obligations such as mortgages and taxes. Lien
Any condition revealed by a title search which affect title to property usually relatively unimportant items but which cannot be removed
without a quit claim deed or court action. Cloud on title title defect
Largest estate of ownership in real property in which the owner holds all rights not reserved by society. Fee Simple Absolute Ownership
A writ that authorizes and directs the proper officer of the court usually the sheriff to carry into effect a judgement or decree of the court. Writ
of Execution
Registration of a real estate instrument can be given due course without the presentation of the owner's duplicate certificate of title when the
document is:
a) Notice of adverse claim
b) Notice of Lis pendens
c) Writ of attachment
d) All of the above