Real Estate Investing Property Management Operations 2

Question 1

A property manager discovers a tenant has sublet the unit without permission. What is the most appropriate first step?

Accepted Answer

Send a written lease violation notice with a cure period

Answer

A written cure notice gives the tenant the opportunity to remedy the violation before escalating to eviction proceedings.

Question 2

Which metric best measures the financial efficiency of a rental property's operations?

Accepted Answer

Operating expense ratio

Answer

The operating expense ratio (operating expenses ÷ gross income) directly measures how efficiently a property is being managed.

Question 3

A landlord in a rent-controlled jurisdiction wants to raise rents. What must they do first?

Accepted Answer

Verify the allowable increase percentage set by the rent control board

Answer

Rent-controlled jurisdictions set maximum allowable increases, and landlords must comply with these limits or face penalties.

Question 4

What is a capital expenditure reserve fund used for in property management?

Accepted Answer

Major improvements and replacements like roofs and HVAC systems

Answer

Capital expenditure reserves are set aside specifically for large, infrequent costs such as roof replacement or major system overhauls.

Question 5

Under the Americans with Disabilities Act (ADA), which properties are most affected by accessibility requirements?

Accepted Answer

Commercial properties and multifamily buildings with common areas

Answer

ADA primarily governs commercial properties and the common areas of multifamily housing, while private residences have different standards under the Fair Housing Act.

Real Estate Investing Practice Test

Real Estate Investing Practice Test

Real Estate Investing Property Management Operations 2