California Real Estate Principles 10 1 Edition Chapter

California Real Estate Principles, 10. 1 Edition Chapter 1: A Career in Real Estate and the Bureau of Real Estate Examination Requirements © 2016 On. Course Learning

Chapter 1 Student Learning Outcomes: 1. Describe the major career choices in the real estate industry 2. List the requirements to become a licensed real estate salesperson and a licensed real estate broker 3. Examine the personal questions to consider before becoming a real estate agent © 2016 On. Course Learning

Real Estate Licenses • There approximately 403, 300 California real estate licensees (as of 08/14) • Broker licensees = 34% • Salesperson licensees = 66% © 2016 On. Course Learning

Sales Specializations • • • Residential Commercial Industrial Business opportunities Agricultural © 2016 On. Course Learning

Land Use Specializations • Land Development Consultant • Urban Planning • Real estate securities • Syndication © 2016 On. Course Learning

Professional Services • Real Estate counselor • Property manager • Investment analyst • Appraiser • Loan officers • Real Estate educator © 2016 On. Course Learning

Real Estate Trade Associations • National Association of REALTORS® (NAR www. realtor. org) – California Association of REALTOR®(C. A. R. www. car. org) – May only use the term: REALTOR® • National Association of Real Estate Brokers® (NAREB) – California Association of Real Estate Brokers® (CAREB) – May only use the term: REALTIST® © 2016 On. Course Learning

Related fields of Employment • • • Title company officers Escrow agents Right-of-Way agents Government employee Employees of chain operation © 2016 On. Course Learning

Designations • • • ABR AIREA AMO CCIM CPM Accredited Buyer Representative (www. rebac. net) American Institute of Real Estate Appraisers Accredited Management Organization Certified Commercial Investment Member (www. ccim. com) Certified Property Manager [Institute of Real Estate Management (IREM) (www. irem. org)] CRB Certified Residential Brokerage Manager (www. crb. com) CRS Certified Residential Specialist (www. crs. com) CRE Counselor in Real Estate (www. cre. org) GRI Graduate, REALTOR® Institute (www. edesignations. com) MAI Member, Appraisal Institute © 2016 On. Course Learning

Important California Events Real Estate License law • • First state to enact a law for licensees 1917 first state license law Real Estate Act of 1919 Written examination © 2016 On. Course Learning

Real Estate Sales License Requirements 1. 2. 3. 4. 5. Must be 18 or older Criminal record must be disclosed Obtain transcripts showing successful completion of the statutory college-level Real Estate Principles, Real Estate Practice, and one other Bureau of Real Estate elective approved course Pass 150 question exam 70% (105 questions) Submit application, licensee fee, and fingerprints © 2016 On. Course Learning

Salesperson License • Meet renewal requirements every 4 years • MUST WORK FOR A BROKER © 2016 On. Course Learning

Licensing Requirements: Broker • Must be 18 years of age or older • Criminal record must be disclosed • Education: 8 approved real estate courses: • Required courses: Real Estate Practice, Legal Aspects of Real Estate, Real Estate Finance, Real Estate Appraisal, and Real Estate Economics or Accounting • Three elective courses approved by the Bureau of Real Estate: Real Estate Principles, Business Law, Property Management, Escrow, Mortgage Loan Brokering, Business Law, etc. • Experience: 2 years as a full-time salesperson within the last five years or activities in lieu of experience check the BRE website: www. bre. ca. gov © 2016 On. Course Learning

To obtain a Real Estate Broker’s License • Pass examination • 200 Questions • 75% correct (150 questions) • After you pass: • Submit application • Pay required fees • Provide live-scan fingerprints • Renew every 4 years © 2016 On. Course Learning

License renewal: • First renewal for sales and broker license requires 45 hours of Continuing Education including the topics of: • 3 hours of Agency • 3 hours of Ethics • 3 hours each of Fair Housing • 3 hours of Trust Fund Handling • 3 hours of Risk Management • 3 hours of Management and Supervision (Broker’s only) • Second all subsequent renewals: 45 hours Continuing Education (CE) which must include the courses listed above or an eight (8) hour survey course covering updates in Ethics, Agency, Trust Fund Handling, Risk Management, Fair Housing (and Management & Supervision for Brokers) © 2016 On. Course Learning

California Bureau of Real Estate • Financed by Subdivision and license fees • Created by Legislature • Governor appoints R. E. Commissioner who: • Screens applicants, administers testing, issues licenses, investigates complaints • Disciplines licensees who violate laws • Regulates subdivisions • Issues rules and regulations • Initiates real estate education and research © 2016 On. Course Learning

No License Required for: • Principals, acting on their own behalf • Attorney, acting in the normal course of their business of the practice of law • Attorney-in-fact, acting for another • On-site resident manager • Trustee, acting in a foreclosure © 2016 On. Course Learning

Business Opportunities • Bill of Sale • Financing Statement • Balance sheet for a given date • Profit and Loss statement for one year • Bulk Sale Law requires Notice (12 days) before close of escrow to notify creditors of the inventory • Goodwill • Real Estate licensee can sell Business Opportunities © 2016 On. Course Learning

Business Opportunity Balance Sheet (specific point in time): Assets (Accounts receivable, personal property, goodwill/patronage, inventory) - Liabilities What the business owes others (Accounts payable, debts, loans)(unremitted taxes) = Net Worth (owner’s equity, retained earnings) Profit & Loss Statement (period of time, typically a year): Income - Expenses = Profitability of the business For a specific period of time © 2016 On. Course Learning

Liquor License • Alcoholic Beverage and Liquor Licenses • Related by Alcoholic Beverage Control Act (ABC) • Types of licenses On-Sale Off-Sale Beer and Wine only • All alcoholic Beverages (General license) • New general license sold by state = $6, 000 • First five years: Resale limited = $6, 000 • Cannot be transferred inter-county • Bulk Sales: Involves inventory of a business. © 2016 On. Course Learning

Working Conditions • • Long working hours Competitive business Liability high for disclosure issues Frequently work nights and weekend Commission – no salary No fringe benefits Pay your own taxes NOT “Get rich quick scheme” © 2016 On. Course Learning

Benefits of Real Estate License • Independent working conditions • Good referral system and good time management equals good money • Select insurance and vacation with your own earnings to fit your individual needs • With small capital, can make excellent income • Excellent opportunity to acquire personal investments for profit or retirement income © 2016 On. Course Learning

Is a Career in Real Estate Right For You? 1. 2. 3. 4. 5. 6. 7. 8. Why are you leaving your current job? How many sales per month do you need to earn your present income? What vacations & holidays and fringe benefits do you need to have and how much do you need to earn to get them? Are you free to work nights and weekends? Do you have the stamina & energy to work sales? Can your personality work peaks and valleys? Can you financially afford to begin sales? Can your family & relations cope with your change? © 2016 On. Course Learning

Personal Checklist 1. 2. 3. 4. 5. 6. 7. 8. 9. Analyze results of an interest inventory test Complete BRE approved real estate courses Check local real estate employment market Select a geographic work area Select offices for work for your selected area Interview salespersons in several offices Make an appointment with the office manager Submit your resume, background, credentials Make a specific list of interview questions © 2016 On. Course Learning