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Opening Worlds

THE UNIVERSITY OF BRITISH COLUMBIA

Real Estate Division

Real Estate Trading Services Licensing Course Manual

Table of Contents

UBC Real Estate Division. 2019. Real Estate Trading Services Licensing Course Manual. Vancouver, BC: UBC Real Estate Division.

Preface: Introduction to Real Estate

Land Ownership
Land Value
Elements of the Real Estate Market
Characteristics of Real Property
Organization of the Real Estate Brokerage Industry

Chapter 1: Fundamentals of Law

The Sources of Our Laws
Categories Within Our Legal System
Real Property Law
The Judicial System in Practice: The British Columbia Court System

Chapter 2: The Real Estate Services Act

Requirements for Licensing
Importance of Agency Law In Providing Real Estate Services
The Licensing Body – The Real Estate Council
The Office of the Superintendent of Real Estate
Real Estate Foundation, Errors and Omissions Insurance Corporation and Compensation Fund Corporation
Other Real Estate Related Organizations
Licensing System
Property Management Conducted by Trading Services Licensees
Trust Accounts
A Closer Look at the Rules
Discipline and Enforcement
The Real Estate Development Marketing Act

Chapter 3: What the Purchaser Buys: Estates and Interests in Land

The Evolution of Real Property Law and the Doctrine of Estates
Fee Simple Estate
Life Estate and Estate Pur Autre Vie
Leasehold Estates
Interests in Land Less Than Estates
The Extent of “Ownership” in Land
Co-Ownership of Land
Appendix 3.1: Form A – Freehold Transfer

Chapter 4: The Subdivision of Land and Title Registration in British Columbia

Who Owns the Land?
How is Land Divided?
How a Strata Development is Created
Types of Strata Property
Title Registration in British Columbia
The Torrens System of Land Registration
Land Title Offices, Searching Title and the Registration Process
First Nations Land Registration
Contaminated Sites
Manufactured Homes
Appendix 4.1: Sample Excerpts from Strata Plans
Appendix 4.2: Sample Title Search

Chapter 5: The Professional Liability of Real Estate Licensees

Common Grounds of Liability Against Licensees
Negligence
Misrepresentations and Deceit
Errors in Drafting Agreements
Breach of Fiduciary Duty
Statutory and Industry Liability
What is the Bottom Line?
Introduction to Tort Law
Trespass
Private Nuisance
Liability of an Occupier

Chapter 6: Commercial and Residential Tenancies

Nature of the Relationship
Types of Tenancies and Termination
Residential Tenancy Arbitrations
The Key Rights and Obligations of the Parties in a Tenancy Relationship

Chapter 7: Strata Properties (Condominiums) and Cooperatives in British Columbia

The Strata Corporation
How a Strata Corporation is Governed
Finances
Bylaws and Rules
Repairs
Legal Proceedings
Strata Titles Compared with Cooperative Corporations
Appendix 7.1: Sample Excerpts from Strata Plans
Appendix 7.2: Strata Property Act Form B – Information Certificate
Appendix 7.3: Strata Property Act Form F – Certificate of Payment
Appendix 7.4: Strata Property Act Form J – Rental Disclosure Statement
Appendix 7.5: Strata Property Act Form K – Notice of Tenant’s Responsibilities

Chapter 8: Financial Statements

Forms of Organization
Importance of Financial Reporting
Generally Accepted Accounting Principles (GAAP)
Financial Statements
Income Tax Return
Analyzing Financial Statements

Chapter 9: Professional Ethics

Why Study Professional Ethics?
Professionalism
What are Professional Ethics?
The REALTOR® Code of the Canadian Real Estate Association
Duty to Uphold the Law
Duty to Client in Real Estate Transactions
Avoidance of Conflicting Interests: Impartiality
Pecuniary Relations with Clients
Responsibility to Other Parties
Duty to the Profession
Disciplinary Hearings Before a Real Estate Board
Appendix 9.1: CREA Standards of Business Practice and Interpretations

Chapter 10: The Law of Contract

Void, Illegal, Voidable and Unenforceable Contracts
Offer
Acceptance
Consideration
Legal Intention
Capacity
Legal Object
Genuine Consent
Termination of a Contract
Remedies

Chapter 11: Contracts for Real Estate Transactions

The Requirement of Writing
Listing Contracts
Contract of Purchase and Sale
Conditions Precedent and Subsequent
Risk Management for Licensees
Appendix 11.1: Sample Listing Contract
Appendix 11.2: Contract of Purchase and Sale
Appendix 11.3: Property Disclosure Statement

Chapter 12: Law of Agency

Agent’s Appointment and Authority
Types of Real Estate Agency Listing Contracts
Relationship Between the Real Estate Agent and the Principal
Agency Disclosure
The Common Law Duties of the Agent to the Principal
The Duties of the Principal to the Agent
Relationship Between the Agent and the Third Party
Appendix 12.1: Two Limited Dual Agency Agreements
Appendix 12.2: Working with a REALTOR®
Appendix 12.3: Exclusive Buyer’s Agency Contract

Chapter 13: Introduction to Mortgage Finance

Role of Financing in Real Estate Transactions
Capital Market
Characteristics of Mortgage Loans as Investments
Development of Contemporary Mortgage Lending
Classification of Mortgage Loans
Mortgage Repayment Plans
Mortgage Interest Rates and the Federal Interest Act
Setting Up the HP 10bII+ Calculator
Basis of Interest Calculations
Future Value and Present Value of Lump Sums
Annuities: Payments
Calculating Interest Only Payments

Chapter 14: Interest Rates and Mortgages

Equivalent Interest Rates
Application of Equivalent Rates to Periodic Mortgage Payments
Analysis of Constant Payment Mortgages

Chapter 15: Introduction to Mortgage Law

Introduction to Mortgage Law
Legal and Equitable Mortgages
Implied Terms of a Mortgage
Express Terms of a Mortgage
Special Types of Mortgages
Federal Legislation over Mortgages
Provincial Legislation Over Mortgages
Assignment of the Mortgage
Assumption of the Mortgage
Novation
Priorities
Further Advances
The Foreclosure Process in British Columbia
Agreements for Sale
Appendix 15.1: Form B – Mortgage

Chapter 16: Mortgage Analysis in Real Estate Practice

Impact of Financing on Real Estate Transactions
Portable Mortgages
Impact of Brokerage and Other Fees
Prepayment Penalties

Chapter 17: Mortgage Underwriting and Borrower Qualification

Residential (Owner-Occupied) Mortgage Underwriting
Financial Covenants of the Borrower
Advancing the Loan and Collection of Payments
Commercial Mortgage Loan Underwriting

Chapter 18: Local Government Law

The Three Levels of Government
The Rationale for the Regulatory System
The Planning Process
Official Community Plans
Rural Land Use Bylaws
Zoning
Land Use Contracts
Non-Conforming Use
Board of Variance
Permits
Subdivision
Building Bylaws and Inspection
Licensing Bylaws
Appendix 18.1: Sample Zoning Bylaw Extract (District of West Vancouver)

Chapter 19: Taxes on Real Property

Taxes on the Purchase or Sale of Real Property
Taxes paid while holding real property
Appendix 19.1: Notice of Assessment
Appendix 19.2: Property Tax Notice

Chapter 20: Building Design and Construction

Current Building Standards
Metric Construction Modules
Materials Used
Architectural Information
Apartment Building Construction
Residential Housing Classifications
Components of a Building
Green Construction
Appendix 20.1: Building Measurement Guidelines
Appendix 20.2: Measurement Practices Bulletin CP-15

Chapter 21: Introduction to Real Estate Appraisal

The Appraisal Process
Step 1: Defining the Appraisal Problem
Step 2: Scope of Work Determination
Step 3: Data Collection
Step 4: Data Analysis
Step 5: Selection of the Appropriate Appraisal Approach
Step 6: Reconciliation of Value Indications and Final Opinion of Value
Step 7: Communicate Findings
Legal Considerations for Appraisal
Looking Ahead – Innovations in Property Valuation

Chapter 22: Direct Comparison (Comparative) and Cost Approaches of Appraisal

Purpose of the Appraisal
Direct Comparison (Comparative) or Market Approach
Analysis of Market Transactions
Adjustments for Value
Case Study 1
Other Applications of the Comparative Approach
Scope of the Comparative Approach
Limitations of the Comparative Approach
The Comparative Approach and the Comparative Market Analysis
The Cost Approach
Determining Market Value by the Cost Approach
Depreciation
Scope of the Cost Approach
Limitations of the Cost Approach
Appendix 22.1: Calculations Used to Find Market Value of a Vendor Takeback
Appendix 22.2: Sample Construction Costs of a Single Family Residence
Appendix 22.3: Sample Comparative Market Analysis (CMA)

Chapter 23: The Income or Investment Approach of Appraisal

Establishing Net Operating Income
Required Rate of Return
Capitalization Process: Market Value
Case Study 1
Case Study 2

Chapter 24: From Contract to Completion

The Contract of Purchase and Sale
Closing Procedures
General Introduction to Statements of Adjustments
Items on Statements
Appendix 24.1: Building Location Survey
Appendix 24.2: Statement of Adjustments

Chapter 25: Introduction to Marketing

Marketing and Real Estate: An Overview
Marketing Theory
Integrated Marketing
The Communication Process
Advertising
Other Types of Marketing
Measuring the Effectiveness of Advertising and Marketing
The Listing Presentation
Developing a Listing Marketing Program
The Competition Act

Chapter 26: Technology and the Real Estate Licensee

Technology and the Licensee’s Office
Software, Apps, and Technological Devices
The Real Estate Licensee’s Website
Email Marketing
Technological Resources
Data Protection and Backup
Online Protocol
Security, Computer, and Consumer Protection

Glossary

Index