Reading...
Play button
Play button
Use LEFT and RIGHT arrow keys to navigate between flashcards;
Use UP and DOWN arrow keys to flip the card;
H to show hint;
A reads text to speech;
75 Cards in this Set
- Front
- Back
|
The landlord
|
lessor
|
|
|
The tenant
|
lessee
|
|
|
Partial transfer of rights held under a lease
|
sublet
|
|
|
Complete transfer of rights held under a lease
|
assignment
|
|
|
One who holds a tenancy at sufferance
|
holdover tenant
|
|
|
Example of a periodic estate
|
month-to-month lease
|
|
|
Entitles landowner to retake possession at the end of the lease
|
reversion
|
|
|
Rent charged for the use of land
|
Ground rent
|
|
|
Specified rent increases at various points in time during the life of the lease
|
step-up rent
|
|
|
A lease clause that allows the landlord to add to the tenant's rent any increases in property taxes, maintenance, and utilities during the life of the lease.
|
Participation clause
|
|
|
Gives a tenant the opportunity of renewing his lease at a predetermined rental without obligating him to do so.
|
option clause
|
|
|
A lease where the amount of rent paid is related to the income the lessee obtains from the use of the premises
|
percentage lease
|
|
|
Describes leases wherein the tenant pays a fixed rent
|
gross lease
|
|
|
Entitles the tenant to uninterrupted use of the property without interference from the owner or third parties.
|
Quiet enjoyment
|
|
|
Statutes that set forth the responsibilities and rights of landlords and tenants.
|
landlord-tenant laws
|
|
|
A lease wherein a tenant pays a base rent plus maintenance, property taxes, and insurance.
|
net lease
|
|
|
The party acquiring possession under a sublet agreement
|
sublessee
|
|
|
The party who assigns her lease rights to another
|
assignor
|
|
|
Nonpayment of rent would be grounds for this,
|
actual eviction
|
|
|
The amount of rent the tenant must pay the landlord as stated in the lease agreement
|
contract rent
|
|
|
An unfit premises would be grounds for this
|
Constructive eviction
|
|
|
Government-imposed limits on how much a landlord can charge for space
|
rent control
|
|
|
An advance deposit given by a tenant to a landlord against which the landlord can deduct for unpaid rent or damage
|
security deposit
|
|
|
A premium, such as a free month's rent, given to entice a prospective tenant to sign a lease.
|
rent concession
|
|
|
A resident manager would be in this management category.
|
On-site management
|
|
|
Professional designations for property managers
|
Certified Property Manager (CPM), Real Property Administrator (RPA)
|
|
|
From the standpoint of the tenant, what are the advantages and disadvantages of a lease versus a month-to-month rental?
|
A lease assures a tenant space at the rent stated in the lease. But it also requires the tenant to pay for the total time leased. A month-to-month arrangement commits a tenant to one month at a time; however, it also commits the landlord for only one month at a time.
|
|
|
What is the difference between contract rent and economic rent?
|
Contract rent is the amount of rent the tenant must pay the landlord. Economic rent is market value rent.
|
|
|
On what basis could a tenant claim constructive eviction? What would the tenant's purpose be in doing this?
|
The tenant's basis would be that the premises is unfit to occupy as intended in the lease. The tenant's purpose is to either get the problem fixed or terminate the lease.
|
|
|
Is an option to renew a lease to the advantage of the lessor or the lessee?
|
An option to renew is to the advantage of the lessee.
|
|
|
If you were an apartment building manager interviewing prospective tenants, what questions would you ask?
|
Questions asked will center on the prospective tenant's ability to pay the rent each month and willingness to abide by the lease contract. Names and addresses of the prospect's current employer and previous landlord would be requested and checked to verify information supplied by the tenant. A credit check would also be run.
|
|
|
What methods might a building owner use to attract tenants in an otherwise soft rental market?
|
Offer rent concessions or reduce the rent.
|
|
|
A lease for a definite period of time, which terminates when that time has expired, is called an
|
Estate for years
|
|
|
A lease of fixed length that continually renews itself for like period of time until the lessor or lessee acts to terminate it is
|
periodic estate
|
|
|
What lease would be unenforceable in court, unless it were in writing?
|
A lease of more than one year must be in writing in order to be enforceable. As a rule, a two-week lease, a month-to-month lease, and a one-year lease are enforceable even though not in writing. Ex. Three-year commercial lease.
|
|
|
An owner leased a building to a tenant under an agreement which gave the tenant the right to occupy the premises for two years, with an option to renew for an additional one-year period. In order to be enforceable, must this lease be in writing and signed by the owner and the tenant?
|
Yes, because the lease is for a period of time in excess of one year. Any lease over one year must be in writing.
|
|
|
To be valid, what must be in writing and signed?
|
any lease over a year. A month-to-month lease is enforceable even though it is not in writing, but a lease for more than one year must be in writing in order to be enforceable.
|
|
|
The right of the lessee to uninterrupted use of the leased premises is called?
|
quiet enjoyment
|
|
|
Under the term of a one-year lease, the
|
tenant commits to pay a full year's rent, even if he vacates the premises before the year expires.
|
|
|
A written lease agreement is still legal even though it fails to include
|
an assignment clause. A valid lease must contain the names of all parties, the terms of the agreement between landlord and tenant and description property in order to be legal. It's not necessary to have an assignment clause.
|
|
|
A written lease agreement for periodic tenancy is still legal even though it fails to include
|
a security deposit. However, it must include the amount of rent to be paid.
|
|
|
A tenant leased an apartment from the landlord under a lease which calls for a total rent of six thousand dollars for the year, but is silent as to when or in what installments the rent is to be paid. Under common law the rent will be due
|
at the end of the year. Unless the lease calls for rent to be paid in advance, it is not due until the end of the lease.
|
|
|
A landlord can charge and a tenant can expect to pay for
|
damages to the premises by the tenant
|
|
|
The word "waive" in a real estate transaction means to
|
surrender, abandon or relinquish
|
|
|
Consumer protection laws and courts place the burden of upkeep and repairs of rented premises on the tenant in
|
commercial leases but not on residential leases
|
|
|
Wally installed built-in bookcases in his rented apartment without the landlord's permission. What is the case in this situation?
|
The bookcases become fixtures when permanently installed and thus became the property of the landlord. The tenant can be held responsible for expenses incurred in their removal, but their installation would not automatically cause forfeiture of the tenant's security deposit.
|
|
|
State-enacted landlord-tenant laws tend to
|
strike a reasonable balance between the rights and responsibilities of both parties
|
|
|
A lease under which the tenant pays a fixed rent and the landlord pays all the operating expenses is a
|
gross lease
|
|
|
A lease which calls for specified rental increases at predetermined intervals is known as a graduated or
|
step-up lease.
|
|
|
The clause in a lease which allows a landlord to pass along to the tenant certain increases in operating expenses is called an
|
escalator clause, or participation clause which refers to contract language whereby the landlord may pass increases in operating expenses to the tenant. (Often with office and industrial leases of five or more years).
|
|
|
When the tenant pays a base rent plus some or all of the operating expenses of a property, the result is a
|
net lease. This is when the tenant agrees to pay some or all of the operating expenses of the property in addition to a base rent. (Commonly used when an entire building is being used and for long-term ground leases.)
|
|
|
A lease in which the tenant pays a rent based upon the gross sales made from the rented premises is known as a
|
percentage lease. This calls for rent to be paid all or in part in the form of a percentage of the gross sales made from the premises.
|
|
|
What are specifically designed to protect against rising operating costs?
What is not protected against rising costs? |
A net lease, an escalator clause and index clause is protected.
A gross lease has no automatic protection against rising operating costs. |
|
|
In Debra's one-year apartment lease, she has a clause that allows her to renew the lease for an additional year at a predetermined rent. This is called an
|
option clause.
|
|
|
Jean's lease of her apartment is silent as to her right to sublet. May Jean sublet without the landlord's permission?
|
Yes, because executory contracts may be assigned unless they contain a non-assignment clause.
|
|
|
Ken signed a one-year lease on an apartment with a rental agency. Ken sublet the apartment to Zee who defaulted on the sublease. Any action entered by the landlord would be against
|
Ken. When a contract is assigned, the assignor remains solely liable for its terms and obligations. The assignee is liable to the assignor.
|
|
|
Under the terms of the typical ground lease, the
|
lessor is the fee simple owner of the land. Typically, under a ground lease, the lessor holds fee simple title to the land, the lessee pays for and owns the improvements. Because they are often for long periods of time, 50 to 99 years, they are often recorded.
|
|
|
The only way for a tenant to terminate a lease for five years is by
|
constructive eviction. While a lease for years may be terminated by constructive eviction, actual eviction, mutual agreement of the parties, or by eminent domain, it may only be terminated by the tenant when the landlord fails to provide essential services (constructive eviction).
|
|
|
A tenant's business has prospered and she needs an additional warehouse. She wants a five-year lease with an escape available at the end of two years, and she wants to be able to stay in the building for an additional five years if her business continues to need the space. Additionally, she wants protection against unexpected rent increases. Her real estate agent would look for warehouses whose owners would offer a
|
two-year lease with an option to renew for three years and an option for five more years. So a gross rent lease for two years with an option to renew at the end of two years followed by an option to either renew or buy the property best fulfills the tenant's objective.
|
|
|
What is true with regard to the contract rent and economic rent of a property?
|
The contract rent and the economic rent are usually the same at the beginning of a lease, but the economic rent may increase or decrease during the term of the lease.
|
|
|
George had a five-year lease on a store building which called for the landlord to provide maintenance on the property. Although he notified the landlord on several occasions of a badly leaking roof, the landlord failed to make the necessary repairs and George had to cease his operations. At this option, George could
|
terminate the lease by claiming constructive eviction. The landlord's inaction constituted constructive eviction and makes the lease terminable at the tenant's option. The tenant is not relieved of the obligation to pay rent if he continues to remain in possession of the premises.
|
|
|
A tenant complained to the housing authority regarding lack of maintenance for his apartment. The landlord served the tenant with an eviction notice because of his complaints. This eviction was
|
a retaliatory eviction and is illegal.
|
|
|
A tenant has a lease on a service station which is being taken by the state highway department under eminent domain in order to widen the highway. The state must pay compensation to
|
both the landlord and the tenant. The government's exercise of its power of eminent domain brought damage to both the landlord and the tenant. Therefore both are entitled to compensation, paid directly to them.
|
|
|
William has a five-year lease on space in an office building. After this lease was recorded in the public records, the landlord secured a new mortgage on the property, on which he later defaulted. When the lender foreclosed on the property, could William's lease be terminated by the purchaser at foreclosure?
|
No, because the lease was recorded prior to the mortgage. But it does remain binding upon the buyer at foreclosure.
|
|
|
Experience with rent controls generally indicates that rent control
|
Creates more problems than it solves.
|
|
|
An investor who is contemplating building or buying rental housing will
|
Capitalize the net income to determine how much to pay for the building.
|
|
|
The LEAST effective use of advertising money for rental housing is
|
radio and television advertising. To promote rental housing, tenant referral fees, newspaper advertising, signs and arrows on and near the property are more cost-efficient forms of advertising than radio or television advertising.
|
|
|
A lengthy tenant application
|
tends to discourage marginally qualified tenants and also provides a basis for checking references.
|
|
|
Property owners can attract tenants in a soft rental market by
|
rent concessions.
|
|
|
To retain tenants, a property manager should think of them as
|
permanent residents, even though turnover is expected.
|
|
|
A property manager can do much to establish and maintain good relations with tenants through
|
Good communications with the tenants
|
|
|
The best defense against losses from uncollected rent is
|
careful tenant selection, good service and
|
|
|
An on-site resident manager serves as
|
The eyes and ears of the property management company and as general superintendent
|
|
|
A successful apartment manager is usually experienced in
|
managing people, handy with tools and fiscally responsible. However, they do not advise tenants in managing their finances
|
|
|
The Institute of Real Estate Management (IREM) is a
|
professional property management organization within the National Association of Realtors.
|
