California Real Estate Principles 12-15

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Original basis plus capital improvements and costs of the sale, less depreciation if income producing

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Adjusted Cost Basis

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A Latin prefix meaning "according to value" Local governments levy real property tax based on the assessed value; property taxes are known as ad valorem taxes

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Ad Valorem

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A list of all taxable property showing the assessed value of each parcel; establishes the tax base

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Assessment Roll or Tax Roll

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A sale of real property to the state, in name only, when a taxpayer is delinquent in paying property tax

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Book Sale

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Money or any "non-like" property put into a sale by an investor to balance the equities in a 1031 tax deferred exchange; cash or mortgage relief in the exchange

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Boot

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Starts on January 1 and continues through December 31 of the same year

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Calendar Year

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Physical improvements made to a property

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Capital Improvements

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Usually the price paid for a property

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Cost Basis

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The estimated period over which an improved property may be profitably used to yield a return

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Economic Life

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Starts on July 1 and runs through June 30 of the following year; used for real property tax purposes

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Fiscal Year

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A $7,000 tax exemption on principal residence of the owner. Not available for vacation homes.

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Homeowner's Exemption

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A deed given to a successful bidder at a tax auction

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Tax Deed

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Causing panic selling by telling people that values in a neighborhood will decline because of a specific event, such as the purchase of homes by minorities

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Block Busting

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A common name for eminent domain, or the right of the government to take a private property form an owner for the public good, paying fair market value

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Condemnation

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The right of the government to take private property from an owner, for the public good, paying fair market value

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Eminent Domain

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A study of how a development will affect the ecology of it s surroundings

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Environmental Impact Report EIR

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Subdivisions located in sparsely populated areas of California, made up of 50 parcels or more

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Land Projects

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Subdivisions located in sparsely populated areas of California, made up of 50 parcels or more

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Land Projects

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Another name for a mobile home

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Manufactured Housing

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The use of a property's location to deny financing

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Redlining

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Illegal practice of only showing clients property in certain areas

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Steering

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A state law protecting purchasers of property in new subdivisions from fraud, misrepresentation or deceit in the marketing of subdivided property; concerned with financial aspects of a development

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Subdivided Lands Act

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Outlines rules for filing subdivision maps to create subdivisions; concerned with physical aspects of a development

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Subdivision Map Act

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The division of land into five or more lots for the purpose of sale, lease or financing

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Subdivision

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An exception granted to existing zoning regulations for special reasons

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Variance

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The occupation of a broker; the business of selling real estate through a broker who negotiates the sale for a commission

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Brokerage

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The previously agreed upon division of money between a broker and sales associate when the brokerage has been paid a commission from a sale made by the associate

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Commission Split

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An escrow business conducted by someone who is a licensed escrow holder

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Neutral Depository

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Money received by real estate brokers or salespersons on behalf of others

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Trust Funds

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The law concerning transfer in bulk (not sale in the ordinary course of the seller's business)

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Bulk Transfer Law

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Any type of business that is for lease or sale

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Business Opportunity

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A written notice filed with the county recorder by a creditor who has extended credit for the purchase of personal property; established the creditor's interests in the personal property which is security for the debt

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Financing Statement

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An intangible, salable asset arising from the reputation of a business; the expectation of continued public patronage

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Goodwill

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A manufactured unit constructed on a chassis and wheels, designed for permanent or semi-attachment to land

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Mobile Home

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A court-approved sale of the property of a deceased person

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Probate Sale

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Collected as a percentage of the retail sales of a product, by a retailer and forwarded to the State Bord of Equalization

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Sales Tax

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Allows a retailer to buy the product as wholesale prices without paying sales tax. the retailer must then collect the proper sales tax from customers and pay it to the State Board of Equalization

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Seller's Permit

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The period that sets apart a whole number from a fractional part of that number

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Decimal Point

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A number by which another number is divided

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Divisor

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A number to be divided by another number

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Dividend

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The percentage of interest charged on the principal

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Rate

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Duration of a loan

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Time