Real Estate Market Flashcards
7 cards from real RAA practice questions. Tap to flip, then mark Knew It or Still Learning — missed cards come back until you master them.
Read the first 7 Real Estate Market flashcards as text
A neighborhood where younger, wealthier residents are moving in and renovating older homes, displacing lower-income residents, is experiencing:
Answer: Gentrification
Gentrification involves higher-income residents moving into lower-income neighborhoods, improving housing stock but often displacing existing residents.
In real estate market analysis, the term 'months of supply' is calculated as:
Answer: Active listings divided by monthly sales rate
Months of supply equals active listings divided by the average monthly sales rate, indicating how long it would take to sell all current inventory.
The 'filtering' process in housing markets refers to:
Answer: Older housing moving down the quality/price spectrum over time
Filtering describes how housing units move down the quality and price spectrum as they age, eventually becoming affordable to lower-income households.
An appraiser studying long-term real estate market trends would find which data source MOST useful?
Answer: FHFA House Price Index spanning multiple decades
Long-term trend analysis requires multi-decade data sources such as the FHFA House Price Index, which tracks price changes over extended periods.
Which principle explains why property values in a neighborhood tend to be influenced by surrounding properties?
Answer: Principle of conformity
The principle of conformity states that maximum value is achieved when properties are similar in size, style, and use to neighboring properties.
A real estate market showing declining days-on-market and increasing list-to-sale price ratios indicates:
Answer: A strong seller's market
Declining days-on-market (properties sell faster) combined with rising list-to-sale ratios (buyers paying closer to or above list) indicate strong seller's market conditions.
In market analysis, 'effective demand' differs from general demand because it requires:
Answer: Both the desire and the financial ability to purchase
Effective demand combines the desire for a property with the purchasing power to actually buy it, distinguishing active market participants from those who merely want to buy.