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Illinois Real Estate License Test 2025/
With Practice Questions And Correct Verified
Answers/ ILLinois Real Estate Exam Prep 2025-
2026 (Brand New!)
Brokerage the business of bringing people together in a real estate transaction real estate licensee acts as a point of contact between two or more people in negotiating the sale, purchase, or rental of property. A real estate licensee may be the agent for the buyer, for the seller, or for both llinois license categories broker, managing broker, and leasing agent Appraisal is the process of estimating a property's market value based on established methods and the appraiser's professional judgment. Property Management a person or company hired to maintain and manage property on behalf of its owner.
Financing is the business of providing the funds that make real estate transactions possible. Most transactions are financed by means of mortgage loans or trust deed loans secured by the property. Subdivision is the splitting of a single property into smaller parcels. Offsite improvements such as water lines and storm sewers, are made on public lands to serve the new development. Onsite improvements are additions or enhancements within the buildings or lots being sold that increase the value of the properties within the development. Onsite improvements include roads and infrastructure or new buildings. 5 Types of Real Property Residential Commercial Industrial Agricultural Special purpose
Factors That Affect the Demand of Real Estate Population Demographics Employment and wage levels Demographics the study and description of population. A professional estimate of a property's market value, based on established methods and using trained, professional judgment, is performed by a real estate appraiser. In general, when the supply of a certain commodity increases, prices tend to drop Which of these factors tends to affect supply in the real estate market? Government controls and financial policies Which factor MOST likely influences the demand for real estate? Wage levels and employment opportunities
Property management, leasing, appraisal, financing, and development are all examples of specializations within the real estate industry. A REALTOR® is a real estate licensee who is a member of the National Association of REALTORS®. A major manufacturer of automobiles announces that it will relocate one of its factories, along with 2,000 employees, to a small town. What effect will this announcement MOST likely have on the small town's housing market? Houses will become more expensive. A licensee who has several years of experience in the industry decided to retire from actively marketing properties. Now this licensee helps clients choose among the various alternatives involved in purchasing, using, or investing in property. What is the licensee's profession? Real estate counselor The term REALTOR® refers to a member of the National Association of REALTORS®. Schools are considered part of which real estate classification? Special-purpose
A real estate professional who performs a visual survey of a property's structure and systems and prepares an analytical report for a purchaser or an owner is acting as a home inspector. When the supply of a commodity decreases while demand remains the same, price tends to rise. When responsible for maintaining a client's property and maximizing the return on the client's investment, a real estate licensee is serving as a property manager. Detailed information about the age, education, behavior, and other characteristics of members of a population group is called demographics. Land: no improvements Real estate: land with improvements
Real property: land with improvements plus rights Land the earth's surface extending downward to the center of the earth and upward to infinity. Land includes not only the surface of the earth but also the underlying soil. Land also refers to objects that are naturally attached to the earth's surface, such as boulders and plants. Land includes the minerals and substances that lie far below the earth's surface (subsurface). It even includes the air above the earth, all the way up into space (airspace) Real Estate is defined as land at, above, and below the earth's surface, plus all things permanently attached to it. Real estate is similar to land but means much more: Real estate includes the natural land along with all human-made improvements. improvement any artificial addition to land, such as a building or a fence Real Property It includes both land and real estate. Real property is the interests, benefits, and rights that are automatically included in the ownership of land and real estate. Real property includes the surface, subsurface, airspace, any improvements, and the bundle of legal rights—the legal rights of ownership that attach to ownership of a parcel of real estate
- right of disposition (to sell, will, transfer, or otherwise dispose of or encumber the property). Personal property property that is movable and not affixed to or associated with the land. Basically, personal property includes all property except real property. Chattels items of personal property, including such tangibles as chairs, tables, clothing, money, bonds, and bank accounts. Trade fixtures are included in this category. Manufactured housing defined as dwellings that are built off site and trucked to a building lot where they are installed or assembled. Manufactured housing includes modular, panelized, precut, and mobile homes. However, the term mobile home usually refers to factory-built housing constructed before 1976. emblements Annually cultivated crops such as wheat, corn, vegetables, and fruit, called emblements, are generally considered personal property. As long as an annual crop is growing, it will stay with the real property unless other provisions are made in the sales contract. Plants (type of property) Trees, perennial shrubbery, and grasses that do not require annual cultivation are considered real estate. They attach to the land.
severance An item of real property can become personal property by severance. For example, a growing tree is real estate until the owner cuts it down, severing it from the property. Similarly, an apple becomes personal property once it is picked from a tree, and a wheat crop becomes personal property once harvested. annexation It also is possible to change personal property into real property through a process called annexation. For example, a landowner buys cement, stones, and sand, mixes them into concrete, and constructs a sidewalk across her land. This landowner has effectively converted personal property (cement, stones, and sand) into real property (a sidewalk). Real Property vs Personal Property (deed vs bill of sale) Real property is conveyed by deed, while personal property is conveyed by a bill of sale Fixtures A fixture is personal property that has been so affixed to land or a building that, by law, it becomes part of the real property. Examples of fixtures are heating systems, elevator equipment in highrise buildings, radiators, kitchen cabinets, attached bookcases, light fixtures, doors, and plumbing fixtures. Almost any item that has been added as a permanent part of a building is considered a fixture. Legal Tests of a Fixture (3) Intent
- Location Scarcity Land is not usually considered a rare commodity, but only a quarter of the earth's surface is dry land; the rest is water. The total available supply of land is not limitless. While a considerable amount of land remains unused or uninhabited, the supply in a given location or of a particular quality is generally considered limited. Improvements Building an improvement on one parcel of land can affect the land's value and use, as well as that of neighboring tracts and whole communities. For example, constructing a new shopping center or selecting a nuclear power site or toxic waste dump can dramatically shift land values in a large area. Permanence of Investment The capital and labor used to build an improvement represent a large fixed investment. Although even a well-built structure can be razed to make way for a newer building, improvements such as drainage, electricity, water, and sewage systems often remain. Location This economic characteristic, sometimes called situs, does not directly refer to a geographic location but rather to people's preferences for given areas. It is the unique quality of these preferences that results in different values for similar units. Location is the most important economic characteristic of land. Physical Characteristics of Real Estate (3)
- Immobility
- Indestructibility
- Uniqueness Immobility It is true that some of the substances of land are removable and that topography may shift. Nevertheless, the geographic location of any given parcel of land can never be changed. It is fixed or immobile. Indestructibility Land is also indestructible. This permanence of land, coupled with the long-term nature of most improvements, tends to stabilize investments in real estate. Uniqueness No two parcels of land are ever exactly the same. The characteristics of each property, no matter how small, differ from those of every other. At a minimum, all parcels differ geographically because each parcel has its own location. Seven Sources of Law
- U.S. Constitution
- Laws passed by Congress
- Rules of the regulatory agencies
- State constitutions
Disposition A man inherited a farm from his uncle. As a new owner, the first thing he did with the vacant property was to remove all the topsoil, which he sold to a landscaping company. He then removed a thick layer of limestone and sold it to a construction company. Finally, he dug 40 feet into the bedrock and sold it for gravel. When the farm owner died, he left the farm to his daughter. Which of these statements is TRUE? The daughter inherits a large hole in the ground, but it is still a farm, down to the center of the earth. The buyer and the seller of a home are debating whether a certain item is real or personal property. The buyer says it is real property and should convey with the house; the seller says it is personal property and would not convey without a separate bill of sale. In determining whether an item is real or personal property, a court would NOT consider a. the cost of the item when it was purchased. b.whether its removal would cause severe damage to the real estate. c. whether the item is clearly adapted to the real estate. d. any relevant agreement of the parties in their contract of sale. a. the cost of the item when it was purchased. Which of these BEST describes the economic characteristics of real estate? a. Location, uniqueness, and indestructibility b. Scarcity, immobility, and improvements c. Attachment, location, and improvements d. Scarcity, improvements, and location
d. Scarcity, improvements, and location An owner decides to sell her house and takes the antique front door with her when she moves. In the absence of any provision in the contract, is the owner allowed to remove the door? No, this act of severance is not allowed at time of selling because the door is a fixture. When moving into a newly purchased home, the buyer discovered that the seller had taken the electric lighting units that were installed over the vanity in the bathroom. The seller had not indicated in the sales contract that these would be removed. Which of these is TRUE? Installed lighting units normally are considered real estate fixtures. A homeowner is building a new enclosed front porch on his home. A truckload of lumber has been left in his driveway for use in building the porch. At this point, the lumber is considered personal property. Intent of the parties, method of attachment, adaptation to real estate, and agreement between the parties are the legal tests for determining whether an item is a fixture or personal property. Parking spaces in multiunit buildings, water rights, and other improvements are classified as appurtenances.
a.sell the property to a neighbor. b. exclude utility meter readers. c. erect No Trespassing signs. d. enjoy profits from its ownership. b. exclude utility meter readers. According to law, a trade fixture is usually treated as personalty A buyer is interested in a house that fits most of her needs, but it is located in a busy area where she is not sure she wants to live. Her concern about the property's location is called a. physical deterioration. b. area preference. c. permanence of investment. d. immobility. b. area preference. Which of these is considered personal property? a. Woodburning fireplace b. Awnings
c. Bathtubs d. Patio furniture d. Patio furniture The basic costs of owning a home may be remembered by the acronym PITI: Principal Interest Taxes Insurance front-end ratio PITI, as well as mandatory assessments and private mortgage insurance if applicable (28%) back-end ratio total housing and all long-term debt (43%) Equity = Current market value - property debt Financial Benefits of home ownership
