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real estate brokerage - ANSWER business is a business that brings interested parties together to sell, lease, rent or exchange real property.
broker - ANSWER acts as an agent or intermediary between two or more people in the negotiation of the sale, purchase, exchange, or rental of real estate
A sales associate - ANSWER (aka Sale Person) works for the broker, providing the services determined by the broker to prospective buyers, sellers, renters, in a contract to close the real estate deal
Farming - ANSWER Real estate professionals often specialize in one particular geographic area or property type
Farm Area - ANSWER is a geographic area or a specific type of residential property where the associate collects data and education of that particular area of type of property
Six Major Real Estate Specialties: - ANSWER 1. Residential Property
- Commercial Property
- Industrial Property
- Agricultural Property
- Business Opportunity
- Special Purpose Property
- Residential property - ANSWER in Florida is described as any property where a single family may own or reside. Residential property is defined as single family dwelling, a duplex, a triplex (3 units) or a quadplex 94 units). It included a vacant land that has been zoned or reserved for 4 units or less. Residential property also includes units/homes in a
condominium, a cooperative, or a Homeowner's Association utilized for year round or vacation living (also called first and second homes).
Farm/Agriculture - ANSWER residential is a family home on less than 10 acres of land.
- Commercial property - ANSWER is income producing property such as retail center or an apartment complex of more than four units. It can also include residences purchased as investments for the purpose of renting. The real estate professional should be able to communicate to the clients and customers, information on how to generate income, maintain the property for tenants or the owner, as well as create cash flow that meets the needs of the investor or owner.
- Industrial property - ANSWER usually consist of manufacturing or distribution facilities such as factory or warehouse. This involves sites in industrial parks or subdivisions, redeveloped industrial parcels in central area and undeveloped industrial acreage. An industrial property expert would understand the transportation needs for the distribution of any goods produced or distributed by that facility.
- Agriculture property - ANSWER is farm or ranch land of more than 10 acres. Agricultural property requires the owner to file with the state, annually the use of the property for agriculture as taxes applied to these properties are discounted significally in order to encourage the production of necessary foods and natural products of consumers.
- Business Opportunity - ANSWER consist of an investor purchasing an income producing business. The purchase may include real estate (property) along with the business or just the business entity and trade fixtures within a leased space. Knowledge of business practices, specific business loans, accounting, and the characteristics of valuation as they apply to the business are necessary.
- Special Purpose Property - ANSWER examples would include schools, churches, nursing homes, post offices and hospitals. Many of these are properties which required re-purposing or a knowledge of the consumer's desires in order to sell these one-of-a-kind types of property. Each zoning district will look at the combination of land and improvements with high and best use in mind.
Property manager must be able to do - ANSWER preventative management, routine maintenance, repair maintenance, and construction maintenance
Preventative maintenance - ANSWER is work done to maintain the property routinely. It consists of tasks involved such as caulking windows and doors, adding oil and fluids to machinery and elevators, spot painting, rust removal, and using minor repairs to prevent major damage, as well as changing air conditioning/furnace filters, etc.
Routine maintenance - ANSWER comprises of lawn mowing, cleaning, discarded trash pickup, inspections, pol cleaning, and other day-to-day tasks which keep the property ready for tenancy.
Repair maintenance - ANSWER includes hiring a specialist, such as a plumber, electrician, HVAC, to conduct repairs that are beyond the preventive and routine maintenance that do not require a trade license.
Construction Maintenance - ANSWER is either a total remodel or addition. For example, an addition could be a clubhouse and/or pool to help make your property more competitive in the market with others of their type. Costs for construction can be extreme so any property manager that advises MUST be aware of the cost benefit in constructing such items or the advantage in selling and finding a property better suited for those needs.
Additional property manager - ANSWER their duty is to protect the owner's investment and maximize the owner's return on their investment. They owe the tenants honesty, accuracy, and disclosure of material facts. They do not have fiduciary relationship with tenants.
3 ways to find value of property - ANSWER Appraising, BPO, and CMA
Appraisal, or finding value, can be done by two parties: ANSWER Comparative Market Analysis (CMA) and Broker Price Opinion (BPO)
Fee appraisal - ANSWER appraiser usually use this; appraise base their payment on the value of the property would be open to scrutiny as they could be tempted to price a property higher to earn more in their fees; appraisal may be performed based off obtaining loan, an insurance value or determine value to sale
3 levels of appraisers for state of Florida - ANSWER Registered Trainee Appraiser-must work under guidance of Certified Residential Appraiser or Certified General Appraiser. Certified Residential Appraiser-Appraises residential properties only. Certified General Appraiser-may perform any type of commercial or residential appraisal.
FREAB (Florida Real Estate Appraisal Board) - ANSWER regulates appraiser, stationed in Orland and consists of 9 members. Enforces Chapter 475, Part II Florida Statues
475.612 - ANSWER Florida Statues allows a Florida licensed real estate broker, sales associate, or broker associate who is not a Florida certified appraiser provide valuation property only if following the USPAP (Uniform Standards of Professional Appraisal Practices)
Appraiser must be paid on a fee-per-job bias, not a percent of the value of the property. pg 11
A BPO (Broker Price Opinion) - ANSWER a quick estimate requested by Mortgage Loan Office, a bank, or a financing entity and use to determine sale prices for foreclose property, short-sale property, deed-in-lieu of foreclose property, USPAP not needed to determine this
CMA Comparative Market Analysis - ANSWER CMA base values on recent home sales, homes currently on the market, homes that were listed but did not sell. Real estate licensees provide Comparative Market Analysis or Competitive Market Analysis
Real estate brokers may use specials online programs - ANSWER such as Multiple Listing Services or Automated Valuation Models, to connect to local taxing and recording offices to obtain the information.
Absorption Analysis- answer the values of properties on the market with the average days on the market to generate; this helps tell how long the customer/clients' home will
Creating roads and utilities
Development
Construction
Land acquisitions - ANSWER occurs when a developer buys undeveloped or previously developed land to build home or commercial properties. (must follow steps of making land pg 12)
Assemblage - ANSWER use several parts of land to make one large piece
Sub-division - ANSWER create smaller areas to be used for different purposes
Planning and conservative - ANSWER plan for the best well being (functional, environmental, safety)
Sub-divider - ANSWER hire a planner who creates plat mat which includes a visual drawing of where each block will be located, as well as streets, parks and utilities. Recorded in county to be use a future reference point.
Dedicate - ANSWER plat mat may have to provide a certain amount of public space depending on how big it is for park, schools, etc. Then it will be filled with state HOA and if the community have different uses for the plat, a Master HOA association or Community Development District to be paid with bonds to cover development costs
Planned Unit Development (PUD) - ANSWER making mini communities within a larger community, sub community may be a condo
Construction can be created in three way - ANSWER 1. Speculation or Spec homes
- Tract Homes
- Custom Home
- Speculation or Spec homes - ANSWER homes are new, move in ready with no specific buyer in mind can be used a model homes, at times pre-sold and leased back to builder, production home, home ready for a buyer who does not have time for home to be built, foot print of homes
- Tract Homes - ANS similar designs to homes in subdivision and may vary by color, cookie cutter, townhome style and may include HOA, condominium association, or combined community association
- Custom Home - ANS build by client's desire
- Review pg 14 in book for - ANS local government, state government, and federal government roles
Real estate broker or sales associate must be competent in - ANSWER Knowledge of Property Transfer-by deed, will, inheritance or use of the use of contracts or trusts
Knowledge of Market Conditions- the level of listings on the market, how the property way may be financed, how quickly property sells and the value of property
Knowledge of how to market real estate- techniques that include proper pricing, disclosure to both the buyer and the seller, service to the buyers and sellers, and maintaining relationships with other real estate professionals
Real estate broker business - ANSWER brings interests parties to sell, lease, rent or exchange real estate; all business done under real estate broker
Florida is different than many other states in there is a real need for - ANSWER property managers. This is due to the fact that so many owners are absentee owners-people who own real estate, but do not reside in that real estate as their primary residence
Chapter 2 - ANSWER Real Estate License Law
Florida Real Estate Commission FREC enforces real estate - ANSWER The Florida Legislature created this organization to administer and enforce license law, authority to
business
qualifying, designated, or managing broker may be used to identify the lead broker for real estate business as qualifying brokers are more common in Florida.
Broker Associate A person who has been educated and qualifies as a broker, who has chosen to work in the capacity of a sales associate under the direction of another qualifying broker.
An applicant is initially - ANSWER licensed as an involuntary inactive sales associate until the associate finds a qualifying broker or an owner-developer who will activate their license and supervise their real estate activity and on the job training.
owner developer - ANSWER is an unlicensed developer who is registered with the state. This person or their company obtains all of the necessary permits and approvals to construct a development on undesired or formerly differently developed land for sale or lease or for lots zoned for their specific buildings. "Sale" or "rent" includes any arrangement by which the owner-developer receives compensation in money, provisions, personal property, or labor from the occupancy or the transfer of the property or any structure placed upon a property.
nolo contendere - ANSWER (must say this on background check for registering with real estate established by 475.17) latin phrase I do not wish to contend, plea of no contest. Alternative to saying guilty or not guilty. Same as guilty plea effect.
Residency defined - ANSWER (6IJ2-26.002 application process (immigrants, exam, etc)
Attorney are exempt - ANSWER from pre-licensing education for sales associate license
If you have a degree 4 year or higher in Real Estate you are exempt from having to take the course Rule 6iJ2-3.008(8) Florida Administrative Code
Real Estate Exam - ANSWER 100 points, 3 tester questions, 3.5 hours, 45 real estate law questions, 45 principles and practice questions, and 10 mathematic questions, score 75
points or higher, have 24 hours to retake if fail, take as many times
Post-License Education ANSWER 45 hour class, pass final exam with 75% and complete 90% of the hours to be completed. Must be completed prior to first expiration of a licensee. Those exempts to this is those who have 4 year Real Estate degree and Real Estate Attorneys under broker.
Void - ANSWER failure to complete post license requirement it never existed. Would have to reapply, be re-approved, retake course, re-exam and do the post license.
License renewak - ANSWER occurrence will be bi-annually on March 31st or September 30 of each year; allowance up to 24 months, first license renewal must be at least 18 months and shall not exceed 24 months.
Ex: license was obtained April 1 2016, licensee would renew on March 31st of 2018; if obtained March 31st at 18 month it would have to renew at 18 months as March 31st would equal 24 months and one day.
Liscense termination- ANSWER Have 5 years to reapply (slim chance to be accepted )with liscense is issued to be moral turpitude equivalent to Rape, robbery. FREC can make fines, etc. If liscense is mistakenly given to DBPR like education or age than you have 1 year to reapply.
Broker license requirements 475.12 ANSWER 5 years active license with 24 month prior re-license, 72 classroom hours with 70% final exam passing. State exam 45% law, 40% principle, 15% math. Retake exam after 24 hours
2 post licensure classes 30 hour each after state exam and do not have to take 14 hour continuing classes for 1 year renewal, it will be null and void if they do not do these courses and have within 6 months to take the 14 months renewal course
Mutual recognition - ANSWER take a written 40 question exam and receive at least 30 points
Prime facie - ANSWER evidence means; evidence good and sufficient on its face. Such evidence is sufficient to establish a given fact.
Selling
Advertising
Leasing
Auctioning
Discussion and advising on sale or leasing details
BARE SALAD is the real estate before the dressing
Real estate or real property - ANSWER means any interest or estate in land, or enterprise or business opportunity, including any assignment, leasehold, sub-leasehold or mineral rights.
Compensation - ANSWER is anything of value, paid, received or expected to paid or received or renunciation for services rendered.
DO not require a real estate license in Florida - ANSWER 475,1(4) A broker acting as a trustee of a trust created if trustee is a bank, state or federal association or trust company processing trust powers
An owner buying or selling own property
Anyone acting as an Attorney in Fact or Trustee
An employee of a public utility, a rural electric cooperative, a railroad or state or local government
A full-time graduate student enrolled in A FREC appraising college report under supervisor
Transient occupancy; or any public lodging establishment
Property management EXEMPT from Florida Real Estate Law more pg 31 - ANSWER A salaried employee
Any salaried employee who is a manager no greater than 1 year
Any property management form or owner, fee not exceed $50 per transaction
Sales associate can not pay a sales associate ANSWER Only a broker can pay a broker
Finder fee allowed * Study 32-33 with dates - ANSWER to a non-license person, is that a paid to a tenant of a residential complex as listed previously; otherwise illegal to pay FInder's Fee (A fee paid to a person for the services of putting together the two parties in a real estate transaction.)Could result to fine of $1000 and 5 years suspension
Chapter 3 - ANSWER Real Estate License Law and Commission Rules
Rules and Regulations - ANSWER Division of Real Estate is comprised of employees of the DBPR that is tasked to regulate real estate only.
DRE protects the public by regulations. (responsible for exam, real estate schools, etc)
FREC Florida Real Estate Commission is composed of 7 volunteers, not state employees. Paid per date reimbursement and make rules of exam and responsible with real estate activity.
FREC does 3 - ANSWER executive power to enforce and regulate real estate license law
Quasi-legislative power to enact rules, rules become effective after 20 days when filed with State
Quasi-judicial in the power to issue subpoenas, impose discipline actions and mandate training for remediation. Can be fine or suspended for up to 10 years.
Florida Real Estate Commission (FREC) 7 members in Orlando - ANSWER 4 members must be license real estate brokers, who have been license for at least five years preceding their appointment
1 member may be a broker or sales associate but must held an active real estate license for at least two years proceeding their appointment
2 members must be consumers who have never held a real estate license
1 of the members must be 60 years of age or older
FREC select chairperson and Vice chair annually
Commission term is 4 years; member may not serve more than 2 consecutive terms
No salary pay; paid only per diem with expenses all paid for
EX: Broker A has a single agency relationship with Seller R. Buyer B contacts Broker A to view Seller R's property through Broker A. Buyer B cannot be represented by Broker A and Buyer B MUST be a non-represented party in the transaction if they are NOT referred to another broker for representation
Transaction Broker - ANSWER limited representation of one or both sides of any sales transaction
Transaction brokerage is the DEFAULT relationship in the state of Florida and all contacts in this capacity are considered to be customers NOT clients or principals.
Single Agent - ANSWER where the broker may represent the seller or the buyer, but never both
Non-representative - ANSWER where the broker is representing the seller or the buyer and the non-represented customer is NOT represented at all
The requirements of the Brokerage Relationship Disclosure Act - ANSWER applies to residential sales ONLY. Agency MUST be established in writing.
Implied agency - ANSWER in Florida does not exist as all brokers and their sales associates are, by default, "transaction brokers". Unless an agency or No brokerage relationship is established in writing, a transaction brokerage relationship would be considered to be in effect
Writing kills any broker to prove that they did not act as an agent, this activity would not be cognized in a Default Transaction Broker position
Ostensible Agency however is a potential problem when competing brokers within a same building or with same brokerage name to establish that they are not related
An agent - ANSWER is a person who is empowered by contract to represent the interest of someone (you in this case) called a Principal or client. This type of a relationship is Fiduciary Relationship which means a relationship of utmost trust and loyalty.
Agency relationship - ANSWER when one person is empowered by another to represent them in a transaction in a fiduciary capacity
Law of agency - ANSWER The law that defines agency relationships
Agency relationships are often governed by - ANSWER Statutory Law- which means the laws that are written by legislatures and currently on record in the country or state as well as
Common Law- which means procedures that have been set by precedent of cases and lawsuits that have been decided through decisions of legal proceedings
In Florida an agency MUST be established before such a relationship would exist - ANSWER A principal/client party MUST request such a relationship or broker MUST establish the relationship
A task or series of tasks under an agreement must be done
An Agent must be authorized by their real estate broker to comply with the agreement
A written Agency Agreement MUST be acknowledged
Acknowledgment DOES NOT mean the party is mandated to sign the agreement of the agency, but acknowledge thru acceptance or receipt of the document
4 kinds of agencies - ANSWER General agent, Universal agent, Agency Couples with an Interest, Special agent
A Universal Agent - ANSWER Represents in all business matters concerning the Principal. The universal agent possesses the Power of Attorney, and is known as Attorney-in-Fact.
General Agent - ANSWER Handles multiple transactions of a client. The best example in real estate would be property management. They work with contractors, leasing the property, negotiating rent, etc. All sales associate are general agents of brokers due to the sales associate having fiduciary relationship to broker
Implied Agency - ANSWER is created by the Acts of the Parties. The acts involved indicate a relationship. Ex: you get in a Taxi and the driver expects you to pay for the service as you expect to be taken to your destination.
Ratification of Agency - ANSWER is always done after the fact. The principal accepts the conduct of a person who acted without prior authorization as the principal's agent, such as a licensee who shows a property without a current listing agreement and then the seller agrees to work with the person (creating an agency) to sell the property. This type of agency relationship is very difficult to prove, and may have other legal problems. Florida does not recognize this agency due to the transaction brokerage default relationship.
Otensible or apparent agency - ANSWER refers to the relationship that exists between two parties and that leads to a person to believe that the first is an agent of the second or vise versa. Ex is a broker is the same building as another broker who represented a principal and a principal sue both due to the same address and under one franchise big name, advertising must prevent this. Ex a broker is employed by an outside builder to sell properties.
Statute of Frauds - Law passed in 1677, all contracts be in writing and signed by ALLL of the parties to be charged.
Principal (client) Fiduciary Relationship Duties (trust and confidence) - Confidentiality, Obedience, Loyalty, Exception COLD
Confidentiality - An agent is required to protect his/her principal's lawful confidences and secrets.
Exception: Misrepresenting facts of the property
Obedience - ANSWER An agent is bound to obey promptly and efficiently all lawful instructions of his principal.
Exception: If any law or unethical practices are broken.
Loyalty - ANSWER An agent's duty to place the client's interest above those of all others, including the agent's own self-interest.
Exception: not disclosing all known material facts to all parties
non-represented seller - ANSWER would be a For Sale By Owner who does not want to be represented but work with a broker on behalf of a buyer, EX: an open listing agreement. Want no assistance in purchase by a sales associate. Depending what is how in the MLS a broker could still collect commission. Disclosures must be given in transactions and brokers must keep a copy; transaction brokerage does not require a disclosure, but ALL other relationships MUST.
Dual Agency not legal in Florida - ANSWER one agent represents both the buyer and the seller at the same time with the same fiduciary duties to both.
Disclosed Dual Agency means both the seller and buyer are aware the agency relationship and both agree to be represented equally.
Undisclosed Dual Agency means either the seller or buyer is unaware that the dual agency exists.
Difference between Dual Agency and Transaction Brokerage - ANSWER Transaction brokerage provides limited representation in making contracts.
Subagent - ANSWER is one who assists in some or all of the duties as assigned by the Agent to do a job for a Principal. When a broker assumes the role of Agent, all sales associates under that broker take on the rob of sub-agent.
In seller disclosure - ANSWER material defects should be listed but not required by law to be written in disclosure but must be mentioned.
It is not required by Florida law to disclose in sales or by sales associate if the site had homicide, suicide, death, or if property had human immune viruses/syndrome
Disclosure rules do not apply to - ANSWER 1) Nonresidential transactions
The rental or leasing of real property, unless an option to purchase all or a portion of the property improved with four or fewer residential units is given
Auctions
