TEXAS SENIOR PROPERTY TAX
CONSULTANT EXAM QUESTIONS AND
ANSWERS
Economic Forces
A consumer's ability to purchase and use real estate. Examples are; Income Levels,
Employment, Housing Construction Costs, Credit Availability, Interest Rates and Utility
Costs
Social Forces
Relate to trends in society or culture. Sometimes imagined, sometimes based on actual
facts or figures. Include: Population Trends, Family Composition, Aging of Americas
Population, Evolution of Home Offices, Environmental Consciousness, Leisure Time,
and The family and functional utility.
Governmental Forces
Maybe on national, state or local level and include: Taxes, Federal monetary policy,
Real Estate taxes and assessments, Labor issues, Quality of Schools, Quality of
Services.
Environmental / Physical Forces
Easy to identify, the desirability of these factors depend upon the property use type.
They include: Location, Transportation, Topography, and Climate/weather.
General Warranty
A title transfer that offers a guarantee of the title from the seller to the buyer.
Leasehold Estate
A tenant or lessee may most likely possess this type of interest.
Manner of Attachment
Used in determining when personal property becomes a fixture.
Real Property
An intangible interest in real estate.
Real Estate
The tangible bricks and mortar and land.
Police Power
Building Codes and zoning represent this power of government.
Private Restrictions
A lease and mortgage
Encroachment
A toolshed that is partly on a neighbor's lot
Severalty
The most common form of ownership. Means one (Individual) - One person or
corporation owns entire bundle of rights
A type of special ownership
Condominium
,A leased fee estate is an interest controlled by the
Landlord
A leasehold estate is created by a?
Lease
The most common value estimate provided in an appraisal of a single-family
home.
Market Value
Which type of appraisal would likely be sought in the appraisal of an established
business operation?
Going Concern Value
Which valuation would be based on a limited marketing period?
Liquidation Value
Which value provides the basis of the real estate tax liability for a property?
Assessed Value
What is the value to a specific occupant?
Value in use
The value to a particular investor
Investment Value
The four agents of production
land, labor, capital, entrepreneurship
To have value, an item must possess what characteristics?
Scarcity, utility, effective purchasing power, and desirability.
Comparing an items value to the items cost is an evaluation of the items
contribution
What two components comprise effective demand?
Desire and effective purchasing power
Scarcity, utility, effective purchasing power, and desire all relate to
Economic Characteristics of Value
Decreasing Returns
When the yield of a product falls as the cost is increased.
Profit
Entrepreneurial incentive
Demand Unit
The combination of desirability and effective purchasing power
economies of scale
The theory that each incremental item becomes less expensive as the volume is
increased.
Neighborhood
A group of complimentary land uses
Mortgage
A capital market instrument
Amortization
The systematic reduction of debt over time
A point equals
1 percent of the loan amount
An organized exchange conduit
,A characteristic indicative of an efficient market
Feasibility study
Examines the profitability of a proposed property.
Office of Management and Budget
Body of Government that controls fiscal policy
Principal and interest
Payments of an amortizing mortgage are comprised of these.
Adjustable rate mortgage
A mortgage in which the interest rate floats with an indexed rate.
General Data
The four forces on real estate -Social, economic, physical/environmental, and
governmental.
Specific Data
Data gathered in the analysis of a certain property (Subject Property)
Primary Data
Data that the appraiser personally collects
In identifying the real estate, the appraiser should consider the following.
Location of the land
Most real estate appraisal assignments involve the valuation of this interest
Fee simple interest
Real estate and real property are
Separate and distinct
Forms of identifying real estate
governmental survey, lot and block system, and metes and bounds
If an appraiser is uncertain as to whether a fixture is to be treated as real or
personal property, he should
consult with the client as to treatment of the item
When appraising fractional interests, the appraiser usually begins with
the entire bundle-of-rights (fee simple)
An example of an economic force
A manufacturing plant reopening after closing, and the Disney theme park outside
Orlando and its impact on uses of land in southwest Orlando.
Examples of social forces
An increasing divorce rate, and an area that has a reputation for being a neighborhood
with a low crime rate and excellent quality of life, and Los Angeles having some major
issues in its economic expansion in the 1980's including civil rights issues, crime and
illegal immigration. Families more aware of recycling their consumer wastes than ever
before.
Examples of governmental forces
Strict building codes requiring poured concrete foundations for homes within the city
and a zoning code that does not allow satellite dishes in the front yard. The department
of defense building a nuclear submarine base in an area increasing development.
Examples of Environmental forces
A neighborhood that has excellent views of the ocean, and San Francisco, a city
influenced by its strategic location along the Pacific Ocean and its favorable climate. A
severe hurricane damaging the Miami region in August 1991.
, A fee simple interest in a property is an example of
Real Property
A window air conditioner that is permanently attached to a home and built in with
caulked, side/top/bottom molding and screwed to the window frame is an
example of a
Fixture
Forms of ownership limitations
Lease, Mortgage and easement
Forms of special ownership
Condominium, Co-Operative, Time-share
A ceiling fan installed in a home is considered
A fixture that is now part of the real estate
Forms of legal descriptions
Metes and Bounds method, Monument System, Government Survey System
What is a condition in the definition of market value?
Buyer and seller are typically motivated
What is a reasonable marketing period for a single-family residence?
Unkown: each individual market is different and a reasonable marketing period depends
upon an analysis of each market.
By definition, market value is?
The most probable price
Appraising an improved property, an appraiser values the improvements as one
use and the site as another use. This violates the theory of...
a. Contribution
b. Conforming use
c. Consistent use
d. Highest and best use
consistent use
Issues concerning a sites physical possibilities, legal permissibility, financial
feasibility, and maximally productive uses relate to
highest and best use
Assume a swimming pool cost $15,000 to install; however, the increase in market
value of the property is only $3,000. Which principle is illustrated?
a. Conformity
b. Consistent use theory
c. Contribution
d. Balance
Contribution
Substitution is the primary basis for which approaches to value?
Cost, Income, and Sales Approaches
The components that comprise demand?
Buyer/tenant profiles, occupancy, and Absorption
The following are credit regulation devices controlled by the Fed
Federal Fuds Rate, Reserve Requirements, and Federal Open Market Committee
What components comprise supply?
Existing Inventory, Properties under construction, and Planned properties
CONSULTANT EXAM QUESTIONS AND
ANSWERS
Economic Forces
A consumer's ability to purchase and use real estate. Examples are; Income Levels,
Employment, Housing Construction Costs, Credit Availability, Interest Rates and Utility
Costs
Social Forces
Relate to trends in society or culture. Sometimes imagined, sometimes based on actual
facts or figures. Include: Population Trends, Family Composition, Aging of Americas
Population, Evolution of Home Offices, Environmental Consciousness, Leisure Time,
and The family and functional utility.
Governmental Forces
Maybe on national, state or local level and include: Taxes, Federal monetary policy,
Real Estate taxes and assessments, Labor issues, Quality of Schools, Quality of
Services.
Environmental / Physical Forces
Easy to identify, the desirability of these factors depend upon the property use type.
They include: Location, Transportation, Topography, and Climate/weather.
General Warranty
A title transfer that offers a guarantee of the title from the seller to the buyer.
Leasehold Estate
A tenant or lessee may most likely possess this type of interest.
Manner of Attachment
Used in determining when personal property becomes a fixture.
Real Property
An intangible interest in real estate.
Real Estate
The tangible bricks and mortar and land.
Police Power
Building Codes and zoning represent this power of government.
Private Restrictions
A lease and mortgage
Encroachment
A toolshed that is partly on a neighbor's lot
Severalty
The most common form of ownership. Means one (Individual) - One person or
corporation owns entire bundle of rights
A type of special ownership
Condominium
,A leased fee estate is an interest controlled by the
Landlord
A leasehold estate is created by a?
Lease
The most common value estimate provided in an appraisal of a single-family
home.
Market Value
Which type of appraisal would likely be sought in the appraisal of an established
business operation?
Going Concern Value
Which valuation would be based on a limited marketing period?
Liquidation Value
Which value provides the basis of the real estate tax liability for a property?
Assessed Value
What is the value to a specific occupant?
Value in use
The value to a particular investor
Investment Value
The four agents of production
land, labor, capital, entrepreneurship
To have value, an item must possess what characteristics?
Scarcity, utility, effective purchasing power, and desirability.
Comparing an items value to the items cost is an evaluation of the items
contribution
What two components comprise effective demand?
Desire and effective purchasing power
Scarcity, utility, effective purchasing power, and desire all relate to
Economic Characteristics of Value
Decreasing Returns
When the yield of a product falls as the cost is increased.
Profit
Entrepreneurial incentive
Demand Unit
The combination of desirability and effective purchasing power
economies of scale
The theory that each incremental item becomes less expensive as the volume is
increased.
Neighborhood
A group of complimentary land uses
Mortgage
A capital market instrument
Amortization
The systematic reduction of debt over time
A point equals
1 percent of the loan amount
An organized exchange conduit
,A characteristic indicative of an efficient market
Feasibility study
Examines the profitability of a proposed property.
Office of Management and Budget
Body of Government that controls fiscal policy
Principal and interest
Payments of an amortizing mortgage are comprised of these.
Adjustable rate mortgage
A mortgage in which the interest rate floats with an indexed rate.
General Data
The four forces on real estate -Social, economic, physical/environmental, and
governmental.
Specific Data
Data gathered in the analysis of a certain property (Subject Property)
Primary Data
Data that the appraiser personally collects
In identifying the real estate, the appraiser should consider the following.
Location of the land
Most real estate appraisal assignments involve the valuation of this interest
Fee simple interest
Real estate and real property are
Separate and distinct
Forms of identifying real estate
governmental survey, lot and block system, and metes and bounds
If an appraiser is uncertain as to whether a fixture is to be treated as real or
personal property, he should
consult with the client as to treatment of the item
When appraising fractional interests, the appraiser usually begins with
the entire bundle-of-rights (fee simple)
An example of an economic force
A manufacturing plant reopening after closing, and the Disney theme park outside
Orlando and its impact on uses of land in southwest Orlando.
Examples of social forces
An increasing divorce rate, and an area that has a reputation for being a neighborhood
with a low crime rate and excellent quality of life, and Los Angeles having some major
issues in its economic expansion in the 1980's including civil rights issues, crime and
illegal immigration. Families more aware of recycling their consumer wastes than ever
before.
Examples of governmental forces
Strict building codes requiring poured concrete foundations for homes within the city
and a zoning code that does not allow satellite dishes in the front yard. The department
of defense building a nuclear submarine base in an area increasing development.
Examples of Environmental forces
A neighborhood that has excellent views of the ocean, and San Francisco, a city
influenced by its strategic location along the Pacific Ocean and its favorable climate. A
severe hurricane damaging the Miami region in August 1991.
, A fee simple interest in a property is an example of
Real Property
A window air conditioner that is permanently attached to a home and built in with
caulked, side/top/bottom molding and screwed to the window frame is an
example of a
Fixture
Forms of ownership limitations
Lease, Mortgage and easement
Forms of special ownership
Condominium, Co-Operative, Time-share
A ceiling fan installed in a home is considered
A fixture that is now part of the real estate
Forms of legal descriptions
Metes and Bounds method, Monument System, Government Survey System
What is a condition in the definition of market value?
Buyer and seller are typically motivated
What is a reasonable marketing period for a single-family residence?
Unkown: each individual market is different and a reasonable marketing period depends
upon an analysis of each market.
By definition, market value is?
The most probable price
Appraising an improved property, an appraiser values the improvements as one
use and the site as another use. This violates the theory of...
a. Contribution
b. Conforming use
c. Consistent use
d. Highest and best use
consistent use
Issues concerning a sites physical possibilities, legal permissibility, financial
feasibility, and maximally productive uses relate to
highest and best use
Assume a swimming pool cost $15,000 to install; however, the increase in market
value of the property is only $3,000. Which principle is illustrated?
a. Conformity
b. Consistent use theory
c. Contribution
d. Balance
Contribution
Substitution is the primary basis for which approaches to value?
Cost, Income, and Sales Approaches
The components that comprise demand?
Buyer/tenant profiles, occupancy, and Absorption
The following are credit regulation devices controlled by the Fed
Federal Fuds Rate, Reserve Requirements, and Federal Open Market Committee
What components comprise supply?
Existing Inventory, Properties under construction, and Planned properties
