1. Chapter 1 Slide 1 Copyright – David A. McGowan All rights reserved. Revised 5-8-09 REAL ESTATE TRANSACTIONS Pre-license 45 Hour Course

2. Chapter 1 Slide 2 Copyright – David A. McGowan All rights reserved. Revised 5-8-09 Instructor:Dave McGowan Phone: (630) 990-5355 (office) 630-927-1400 (cell) Email Address:mcgowan@inlandgroup.com Questions: Questions can be fielded either by telephone, e-mail, before & after class. REAL ESTATE TRANSACTIONS

3. Chapter 1 Slide 3 Copyright – David A. McGowan All rights reserved. Revised 5-8-09 Pursuant to Illinois Real Estate License Law Attendance is mandatory for the entire 45 hour program. Classes can be made up either by attending a class offered by the School at a different location and time or by completing the audio series in the school office during regular business hours. COMPLETION CRITERIA

4. Chapter 1 Slide 4 Copyright – David A. McGowan All rights reserved. Revised 5-8-09 COMPLETION CRITERIA Exams Two 50 question multiple choice exams 150 question multiple choice comprehensive final exam ** Under Illinois Law you must pass the final exam with a minimum score of 75% to be eligible to sit for the State Examination.

5. Chapter 1 Slide 5 Copyright – David A. McGowan All rights reserved. Revised 5-8-09 STATE LICENSE EXAM 145 questions 100 Uniform (common law) 40 State Specific 5 Pre-Test Questions (Not counted towards successful completion of the examination)

6. Chapter 1 Slide 6 Copyright – David A. McGowan All rights reserved. Revised 5-8-09 Broker Salesperson 1. Listing Property 31 34 2. Selling Property 21 22 3. Property Management 14 12 4. Settlement/Transfer of Ownership14 17 5. Financing 10 12 6. Professional Responsibilities/ Fair Practice/Administration 10 3 Total 100 100 Common Law Categories & Question Count CANDIDATE HANDBOOK

7. Chapter 1 Slide 7 Copyright – David A. McGowan All rights reserved. Revised 5-8-09 HANDLING EXAM QUESTIONS Simplistic approach Read the question carefully Don’t make assumptions

8. Chapter 1 Slide 8 Copyright – David A. McGowan All rights reserved. Revised 5-8-09 Illinois specific concepts MODERN REAL ESTATE PRACTICE Book Organization In Illinois Look for the markers, the grey rectangle with the words “In Illinois” is the beginning of the Illinois specific law. The smaller square at the end of the passage reflects the ending point.

9. Chapter 1 Slide 9 Copyright – David A. McGowan All rights reserved. Revised 5-8-09 MODERN REAL ESTATE PRACTICE Book Organization Math FAQS (Page 475) Math Examination (Page 499) Answers (Page 501) Uniform Sample Exam (Pages 517 & 536) State Specific Sample Exam (Pages 527 & 547) License Law Sample Exam (Page 555) Glossary (Page 569) Chapter Question Answers (Page 588)

10. Chapter 1 Slide 10 Copyright – David A. McGowan All rights reserved. Revised 5-8-09 Chapter 1 REAL ESTATE BUSINESS Brokerage Appraisal Property Management Financing Subdivision & Development Home Inspection Counseling Education Auctioning

11. Chapter 1 Slide 11 Copyright – David A. McGowan All rights reserved. Revised 5-8-09 National Association of Realtors ® Illinois Association of Realtors ® Northern Illinois Commercial Association of REALTORS ® PROFESSIONAL ORGANIZATIONS

12. Chapter 1 Slide 12 Copyright – David A. McGowan All rights reserved. Revised 5-8-09 TYPES OF REAL PROPERTY (Page 5) Residential Retail Office Industrial Land/Agricultural Special Purpose

13. Chapter 1 Slide 13 Copyright – David A. McGowan All rights reserved. Revised 5-8-09 THE REAL ESTATE MARKET PLACE Supply and Demand (Page 6) Remember the Cabbage Patch Doll? $75 - $125 $19.99

14. Chapter 1 Slide 14 Copyright – David A. McGowan All rights reserved. Revised 5-8-09 SUPPLY & DEMAND Price follows demand: High demand, high prices; Low demand, low prices Price follows demand

15. Chapter 1 Slide 15 Copyright – David A. McGowan All rights reserved. Revised 5-8-09 SUPPLY AND DEMAND Factors Affecting Supply (Page 7) Labor force Construction costs Government control Financial policies

16. Chapter 1 Slide 16 Copyright – David A. McGowan All rights reserved. Revised 5-8-09 Factors Affecting Demand (Page 7) Population Demographics Employment & wage levels SUPPLY AND DEMAND