As I was making my online rounds today, I came across an interesting quiz that I thought that I could share with you all. It’s a quiz that I found on ProProfs Quiz Maker and this particular quiz was created by someone with the name Maliburenter. So first off, I’d like to clarify that Malibu renter was the one that created this quiz and that I am merely sharing the quiz and discussing some of the answers because I think it would be beneficial information to share around and further discuss.
The quiz is called: Are You Smarter Than A Real Estate Agent?
1. Looking at the long history of US home prices adjusted for inflation (1890 to 2008), how long has it historically taken for US home prices to double (for the same type and size of house in the same location)?
A. 5 – 10 years
B. 10 – 20 years
C. 20 – 50 years
D. 50 – 80 years.
Answer: D. 50 – 80 years
Maliburenter then goes on to discuss that the shortest period of time for the prices to double was from 1949 to 2006, 57 years. But that from 1890 to 2000, that had never occurred. The first time that this doubling occurred was in 2001 when the home prices adjusted for inflation were twice as high as the prices of homes in 1921.
2. Can the value of a home drop so much that it has to be given away in order to find a new owner?
A user from ProPros named Aubrey766 shared that there are many examples in Detroit, Cleveland and place in Indianapolis, when prices drop below a few several thousand dollars. No don’t be alarmed, this is not common and usually happens to smaller homes that have no been repaired in a while and also in areas where the population is dropping off.
3. What portion of US homeowners take the mortgage interest deduction?
E. Over 60%
This answer is based off of the year 2007 where 43% of homeowners took the mortgage interest deduction.
4. If overall inflation is 3% per year (with similar rate of inflation for home prices, maintenance, and property taxes), buying a house with a fixed rate mortgage means that the cost of living in that house will:
A. Stay the same for 30 years
B. Rise by 1-3% per year
C. Rise by 3%+ per year
Answer: Raise by 1-3% per year.
Maliburenter goes on to explain that because the cost of maintenance, insurance, and property taxes all rise over time, having a fixed rate loan is only a partial part against inflation.
5. If a stockbroker or investment advisor knowingly made misleading statements about historic returns on an investment to a potential investor, what could happen?
B. License Revocation
D. Criminal Penalties
E. All of the Above
Answer: All of the Above
10b-5 of the Federal Securities Act of 1934 Employment of Manipulative and Deceptive Devices States: “It shall be unlawful for any person, directly or indirectly, by the use of any means or instrumentality of interstate commerce, or of the mails or any facility of any national security exchange, A. to employ any device, scheme, or artifice to defraud, B. to make any untrue statement of material fact or to omit to a state a material fact necessary in order to make the statements made, in the light of the circumstances under which they were made, not misleading, or to engage in any act, practice, or course of business which operate or would operate as a fraud or deceit upon any person, in connection with the purchase or sale of any security.