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##### Real Estate Practice : Lesson 2873
By David Saks, Broker / Industry Analyst
#873 What would a property be worth if the net return is \$9500 per month and the yearly earning is 8% return on the investment ?Please take your time. The solution is posted below the wildlife photograph. A. \$1,425,000 9500 monthly*12 months=114000 yearly /0.08 rate of return=\$1,425,000 property value with 8% rate of return.
##### Real Estate Practice : Lesson 2872
By David Saks, Broker / Industry Analyst
#2872 In a twelve unit apartment building, three units rented for \$1000 per month each, two of the units rented for \$1250 each per month, and one of the units rented for \$1500 per month.The rest of the units, six of them, were efficiencies and rented for \$650 per month.What was the gross annual income ?Please take your time. The solution is posted below the wildlife photograph.   A. \$130,800 annual gross income 1000*3 units=3000 1250*2 units=2500 1500*1 units=1500 650*6 units=3900 3000+2500+1500+3900=10900 monthly*12 months=\$130,800 annual gross income
##### Real Estate Practice : Lesson 2871
By David Saks, Broker / Industry Analyst
#2871 What is the area of a square-acre lot in terms of feet on each side ?Take your time. the solution is posted below the wildlife photo. A. 208.7 feet on each side If there are 43,560 square feet in an acre take out your calculator and put 43,560 square feet (the number of square feet in an acre) into the number field , hit the square root funtion and get 208.71032557111303591192697393256 (extreme) or 208.7 feet per side.
##### Real Estate Practice : Lesson 2870
By David Saks, Broker / Industry Analyst
#2870 How many section comprise a township ? Please take your time. The solution is posted below the wildlife photo. A. 36 sections 36 sections = 1 township (6 miles long and 6 miles wide) each section equals one square mile. Remember that a township is part of a territorial subdivision
##### Real Estate Practice : Lesson 2869
By David Saks, Broker / Industry Analyst
#2869 How many acres are there in a township section ?Please take your time. The solution is poste below the wildlife photo. A. 640 640 Acres = 1 Section Also remember that there are 36 sections in a township. A township is a territorial subdivision which is six miles long, six miles wide, contains thirty six sections with each section being one mile square.
##### Real Estate Practice : Lesson 2868
By David Saks, Broker / Industry Analyst
#2868 A buyer purchased a commercial lot 75 feet wide by 165 feet deep and later sold it for \$1,935.00 per front foot. What was the selling price of the commercial lot ? Please take your time. The solution is below the wildlife photograph. A.  \$145,125 The front footage is 75 feet so multiply 1935 times 75 to get the total selling price of the commercial lot which is \$145,125.
##### Real Estate Practice : Lesson 2867
By David Saks, Broker / Industry Analyst
#2867 Armando Corea bought a square lot which was 10 thousand square feet. He's going to build a house on it which is 45 feet squared and with an average height including the basement of 30 feet. The costs are \$250 per front foot for the land and \$3.50 per cubic foot for the home. What is the total cost for the home ? Please take your time. The answer is posted below the wildlife photo. A. \$237,625 We know that 100 times 100 equal 10,000 square feet, so 100 feet would equal the front footage of the home, and we need to multiply 100 times \$250 to get the cost per front foot which is 25 thousand dollars. Next, multiply 45 squared times the height of 30 feet to get the cubic footage of the home which is 60,750 cubic feet. Multiply 60,750 times \$3.50 per cubic foot to get a total cost of \$2...
##### Real Estate Practice : Lesson 2866
By David Saks, Broker / Industry Analyst
#2866 What would the quarterly interest be on a \$600,000 loan which has an annual interest rate of 5.5% ? Please take your time. The solution is below the royalty free wildlife photograph. A.  \$8250 Multiply the annual interest rate of 5.5% times the loan amount of 600 thousand dollars and we find that the total annual interest is 33 thousand dollars. Now divide 33 thousand dollars  by 12 months and we find that one months interest is \$2750. We're looking for a quarterly interest payment, so 3 months equal one quarter of the year. Multiply \$2750 times 3 months and we see that the quarterly interest payment equals \$8250.
##### Real Estate Practice : Lesson 2865
By David Saks, Broker / Industry Analyst
#2865 Compute the excavation cost for a cellar 25 feet wide , 30 feet long and 5 feet deep at a cost of \$29.00 per cubic yard. Please take your time. You'll find the solution below the wildlife photo at the bottom of the page. A. \$4027.78 Multiply 25 ft times 30 ft times 5 ft to derive a total of 3750 cubic feet. Divide 3750 cu ft by 27 to derive the number of cubic yards, 139.88 cu yd Now, multiply 138.888889 cu yds times our cost,\$29 per cubic yard, and we see that the excavation cost is \$4027.777781 or rounded \$4027.78.
##### Real Estate Practice : Lesson 2864
By David Saks, Broker / Industry Analyst
#2864 A borrower has a principal balance on his mortgage of \$600 thousand dollars. His interest rate is 5.5% and his taxes and insurance total \$10,800 annually. His monthly payment is \$6000 dollars. What is the principal balance after he makes the first payment ? Take your time. The solution is posted below the wildlife photo. A. \$597,650 Multiply the principal balance times the interest rate of 5.5% by multiplying 600 thousand times .05 and we see that we have a total annual interest of \$33,000. Now divide 33,000 by 12 months to get the one month interest total of \$2750. Now let's divide the taxes and insurance by 12 months by diving 12 into 10,800 and we see that the monthly taxes and insurance costs equal 900 dollars. Add 2750 and 900 to get a total interest, taxes and insurance cost...
##### Real Estate Practice : Lesson 2863
By David Saks, Broker / Industry Analyst
#2863 The net amount a seller received for his property, after the broker had deducted a sales commission of 5% and an allowance of 400 dollars for advertising, was \$908,000. What was the selling price of the house ? Take your time. The solution is posted below the wildlife photograph.     A. \$956210.53 Add the 400 dollars for the advertising to the amount the seller received to get a total of 908,400 and then divide that number by .95 (subtract the 5% commission rate from 100%) . 908400/0.95=956210.526316 or \$956,210.53 rounded
##### Real Estate Practice : Lesson 2862
By David Saks, Broker / Industry Analyst
#2862 How many acres are there in a parcel of land 600 feet by 300 feet ? Please take your time. The answers are posted below the wildlife photo. A.  4.132231 Multiply 600 feet times 300 feet and we have a total of 180,000 square feet. If one acre equals 43,560 square feet, divide 43,560 in 180,000 and we see that we have a total of 4.132231 acres (or rounded to 4.13).
##### Real Estate Practice : Lesson 2861
By David Saks, Broker / Industry Analyst
#2861 If sixteen acres of commercial land sell for \$720,000, how much will 200 acres cost ? Take your time. The answer is posted below the wildlife photograph. A. 9 million dollars Divide 720 thousand by sixteen to get the price per commercial acre sold. The answer is 45 thousand dollars per acre. Multiply 45 thousand times 200 and we see that 200 acres of commercial land will cost 9 million dollars.
##### Real Estate Practice : Lesson 2860
By David Saks, Broker / Industry Analyst
#2860 If you bought a house for the listing price less 20% and sold it for the listing price, what percent of profit would you make ? Take your time. The answer is posted below the wildlife photo. A. 25% Here's an example for you. Let's say we bought the home with a listing price of 500 thousand dollars for twenty percent less than the listing price. That would amount to a selling price of 400 thousand dollars. Let's subtract the original listing price of 500 k from the selling proce of 400 k and we see that the 20% less amounts to a savings of 100 thousand dollars over the original listing price. Now we're going to flip the house for 500 thousand dollars and make one hundred thousand dollars on the deal. Now let's divide 400,000 (the price we paid for the house) into the profit we made...
##### Real Estate Practice : Lesson 2859
By David Saks, Broker / Industry Analyst
#2859 A piece of land 500 feet by 350 feet had a sidewalk laid around it by the owner. The sidewalk encompassed the entire lot and a curb was placed along the lot lines. The sidewalk cost \$32,000 and the curb was \$20 per lineal yard. What was the total cost of the sidewalk including the curb ? Please take your time. The answer is below the wildlife photo. A. \$43,333.33 Remember that we're looking for a linear yard (3 feet) and not a cubic yard. First, find out what the total perimeter of the curb is by adding 500 plus 500 plus 350 plus 350 and we get the total perimeter of the curb is 1700 feet. Now, remember we want linear yards and not cubic so divide 3 (feet) into 1700 for a total of 566.666667 yards. Multiply 566.666667 yards times \$20 per linear yard aqnd we find that we have a cos...
##### Real Estate Practice : Lesson 2858
By David Saks, Broker / Industry Analyst
#2858                                                       A builder / developer has 5.25 acres of land. He wants to divide the land into lots 60 feet wide by 100 feet deep. 36,690 square feet of land is required for street construction With all of the above considered, how many lots could be derived from the tract of land ? Take your time. The answer is below the wildlife photo. A. 32 lots Multiply 43,560, the number of square feet in an acre, time 5.25 acres of land for a total of 228,690 square feet of land. Subtract the necessary 36,690 square feet for the streets from the total square footage of the tract of 228,690 square feet and we have 192,000 square feet remaining for lots. If each lot is 60 feet by 100 feet, multiply 60 times 100 to get 6000 square feet which is the size of...
##### Real Estate Practice : Lesson 2857
By David Saks, Broker / Industry Analyst
#2857 Arnold got his tax bill today and it was \$4903.00. The tax rate is 42 mills per dollar. The property is assessed at 58.25% of it's value. What is the actual value of Arnold's property ? Take your time. The solution is below the wildlife photo.   A. \$200,408.75 4903 tax billdivided by0.042 mills=116738.095238 assessed value of the property or 58.25% of it's valuedivided by0.5825 the assessed rate=200408.74719 or 200,408.75 rounded the actual value of the property.