Unit One Summary

Question 1

What economic forces influence the real estate market?

Answer 1

Interest rates and employment levels

These forces impact consumer confidence and investment decisions.

Question 2

What must licensees do to be successful in the real estate market?

Answer 2

Follow economic trends and anticipate their direction

Understanding economic trends helps in making informed decisions.

Question 3

What 4 factors contribute to consumer confidence?

Answer 3

• Perceived job security
• Availability of credit
• Impact of inflation
• Actions of the Federal Reserve Board

Consumer confidence affects how people use their income.

Question 4

What general trends in the economy influence real estate investment decisions?

Answer 4

Availability of mortgage money and interest rates

These trends affect an individual’s willingness to invest in real estate.

Question 5

What are some services provided by the real estate industry besides brokerage?

Answer 5

• Appraisal
• Property management
• Property development
• Counseling
• Property financing
• Education

Most firms specialize in one or two of these areas.

Question 6

What types of real property can be classified in the real estate market?

Answer 6

• Residential
• Commercial
• Industrial
• Agricultural
• Special purpose

Licensees often specialize in specific types of real property.

Question 7

Define a market in the context of real estate.

Answer 7

A place where goods and services can be bought and sold, and price levels established based on supply and demand

Real estate markets are unique and slow to adjust.

Question 8

What 5 factors affect real estate supply and demand?

Answer 8

• Changes in population and demographics
• Wage and employment levels
• Construction costs
• Availability of labor
• Governmental monetary policy and controls

These factors influence pricing and market dynamics.

Question 9

True or False: High demand leads to low prices in real estate.

Answer 9

False

High demand typically results in high prices.

Question 10

Fill in the blank: A market is established based on _______ and _______.

Answer 10

supply and demand

This relationship is crucial for determining price levels.