Download 2025 National Math For Alabama Real Estate Exam Questions And Answers and more Exams Real Estate Management in PDF only on Docsity!
Exam Questions And Answers
Many real estate math problems have formulas that fit into the T- bar method. This is the basic set up of the T-bar: - correct answer ✅If the math problem provides the top number and either bottom number, divide the bottom number into the top number. Area of a Rectangle or Square - correct answer ✅Width x Depth/Length (Horizontal) or Width x Height (Vertical) Area of a square or rectangle - correct answer ✅Area is the measurement of a flat surface and is expressed in square feet (SF, sq/ft). So, square footage is how large a lot or parcel is (how much area it contains). When a rectangular lot is described using its dimensions, such as "150 feet by 300 feet," the first dimension is the width of the lot and second dimension is the depth of the lot. Depth means how far back the lot goes if one is standing in front of it.
Exam Questions And Answers
Width - correct answer ✅Area ÷ Depth/Length (Height) Depth/Length (Height) - correct answer ✅area/ width Area of a Triangle - correct answer ✅A=1/2bh Area of a Trapezoid - correct answer ✅Area = (L + L / 2) x H 1 Acre - correct answer ✅43,560 square feet If a man purchases a lot that measured 600' x 363' and costs $ per acre, what was the total cost of the lot? - correct answer ✅Calculate the size of the lot in acres: 600' x 363' = 217,800SF Calculate the number of acres in the lot: 217,800 / 43,560 = 5 Acres
Exam Questions And Answers
Setbacks - correct answer ✅are the amount of space local zoning regulations require between the property line and any improvements. setback line - correct answer ✅the boundary line that delineates the setback area to calculate the remaining area of the lot that can be built on, subtract the setbacks from the dimensions: - correct answer ✅The front yard and back yard setbacks are subtracted from the depth. The side yard setbacks are subtracted from the width On a residential lot that measures 70 feet by 100 feet, the side-yard building setbacks are 10 feet, the front-yard setback is 25 feet, and the rear-yard setback is 20 feet. What would the maximum possible area for a one-story structure be for this lot? - correct answer ✅Subtract the front yard and back yard setbacks from the depth: 100' - 25' - 20' = 55' new depth Subtract the side yard setbacks from the width: 70' - 10' - 10' = 50' new width
Exam Questions And Answers
Multiply new depth by new width: 55' depth x 50' width = 2,750 SF maximum possible area Calculating Section Size - correct answer ✅The Rectangular/Government Survey is type of legal description that describe a parcel of land using a set of fractions and the corresponding section, township and range numbers. While legal descriptions will be covered in detail in the National Appraisal chapter, students must learn how to calculate the size of the parcel described using this method. section - correct answer ✅Is 1 mile wide and 1 mile deep. Contains 640 Acres Volume Measurement - correct answer ✅Volume is the amount of something that a container can hold. For example, the amount of
Exam Questions And Answers
Gross Rent Multiplier= - correct answer ✅sales price/ monthly rental income Sales price= - correct answer ✅monthly rental income x GRM monthly rental income= - correct answer ✅sales price/ GRM Gross Income Multiplier= - correct answer ✅sales price/ annual income sales price= - correct answer ✅annual income x GIM annual income= - correct answer ✅sales price/ GIM Cost Approach Formula - correct answer ✅Cost approach is another valuation or appraisal
Exam Questions And Answers
method based on the principle of substitution; the value of a building cannot be greater than the cost of purchasing a similar site and constructing a building of equal value. Value = Land value + (Improvements + Capital additions - Depreciation) Depreciation - correct answer ✅annual depreciation= beginning depreciable basis/ depreciation term (# of years) depreciable basis= - correct answer ✅(initial property value + any capital improvements
- land value) Income Capitalization Formula - correct answer ✅The Income Capitalization Formula determines the rate of return considered to be a reasonable return on investment - given the risk of income to value of the property. It also determines an income property's value based on the income to its rate of return.
Exam Questions And Answers
fee paid= - correct answer ✅loan amount x points Annual interest - correct answer ✅is the annual amount of money someone pays to borrow money. When calculating interest remember to convert annual payments to monthly or vice versa as the question requires, and to exclude principal payments from calculations. payment= - correct answer ✅principal x rate principle= - correct answer ✅payment/ rate rate= - correct answer ✅payment/ principle amortized loan - correct answer ✅is a debt paid off over a period of time with periodic payments
Exam Questions And Answers
interest- only loan - correct answer ✅pays down the interest owed, none of the principle. interest-only loan - correct answer ✅Total interest = Loan amount x Rate x Term in years amortized loan - correct answer ✅Total interest = (Monthly PI payment x 12 x term) - Loan amount amortization calculation - correct answer ✅Month 1: Principal paid = Monthly payment - (Loan amount x Rate ÷ 12) Month 2: New loan amount = (Previous month principal - Principal paid) Principal paid = Monthly payment - (New loan amount x Rate ÷ 12)
Exam Questions And Answers
loan= - correct answer ✅LTV Ratio x Price (Value) price (value)= - correct answer ✅loan/ LTV ratio Income Ratio Qualification - correct answer ✅Monthly Principal & Interest (PI) payment = Income ratio x Monthly gross income Debt Ratio Qualification - correct answer ✅debt ratio = (housing expense + other debt payment) / monthly gross income appreciation - correct answer ✅increase in value over time total appreciation - correct answer ✅current value - original price
Exam Questions And Answers
total appreciation rate - correct answer ✅Total appreciation / Original price average annual appreciation rate - correct answer ✅Total appreciation rate / Number of years One year appreciation rate - correct answer ✅Annual appreciation amount / Value at beginning of year Compound appreciation - correct answer ✅appreciated value= beginning value x (1+ annual rate) x (1+ annual rate).... for however many years in question Rate of Return, Investment Value, Income - correct answer ✅Rate of return is a percentage relationship between the investment price and the returns. rate - correct answer ✅income/ value
Exam Questions And Answers
amount realized - correct answer ✅= sales price - selling costs adjusted basis - correct answer ✅= beginning basis + capital improvements - total depreciation total depreciation - correct answer ✅Beginning depreciable basis / depreciation term (years) x years depreciated depreciable basis - correct answer ✅initial property value + capital improvements - land value tax liability - correct answer ✅(NOI + Reserves - Interest expense - Depreciation) x Tax bracket ROI (return on investment) - correct answer ✅NOI/ price
Exam Questions And Answers
Return on Equity (ROE) - correct answer ✅Net Income (cash flow)/Total Equity monthly percentage rent - correct answer ✅Sales x % Sales charged new rent - correct answer ✅current rent x (100% + escalation rate) 1 mil - correct answer ✅=$.001; a mill rate of 1 mill per $1,000 = .1%; a 1% tax rate = 10 mills tax - correct answer ✅=(taxable value/ 1000) x mil rate tax base - correct answer ✅= assessed valuations - exemptions
Exam Questions And Answers
minimum listing price - correct answer ✅(desired sellers net profit + loan payoff + closing costs = sellers gross profit) / sellers % = minimum listing price percentage of listing price - correct answer ✅=Offer / listing price deposit - correct answer ✅=offering price x required or market accepted percentage 30-Day 12-Month Method - correct answer ✅Monthly amount = Annual amount / 12 Daily amount = Monthly amount / 30 Proration = (Monthly amount multiplied by the # months) + (Daily amount multiplied by the # days) 365 day method - correct answer ✅Daily amount = Annual amount / 365, OR Monthly amount / Length of month Proration = Daily amount multiplied by the # days
Exam Questions And Answers
Income received in advance - correct answer ✅Investment properties collect rent each month. The amount of rent is prorated between the buyer and seller for the month in which the sale takes place. Expenses paid in Arrears (Tax) - correct answer ✅Credit buyer and debit seller for seller's share Recovery with Co-Insurance Clauses - correct answer ✅Formula: Recovery = Damage Claim x (% Replacement Cost Covered / Minimum coverage requirement) Example: An owner insures a home for $100,000. Replacement cost is $150,000. A co-insurance clause requires coverage of 80% of replacement cost to avoid penalty. Fire destroys the house. What can the owner recover from the insurer? Claim recovery = $150,000 x (67% cost covered ÷ 80% required) = $125, John bought an odd-shaped lot that was 100 feet deep, but the front footage was 160 feet and the length of the back side of the lot
