Jamaica REB Salesman Exam cheat sheet

Freehold estate: ownership of land for an indefinite duration; the two principal forms in Jamaica are fee simple (absolute, inheritable) and life estate (limited to a named person's lifetime).

Leasehold estate: a right of possession for a fixed term; it is a chattel interest, not an interest in land, so it is transferred by assignment rather than by conveyance of title.

Bundle of rights: possession, use, exclusion, enjoyment, and disposition. A sale normally transfers all five unless expressly reserved (e.g. a reserved right of way).

Highest and best use: the reasonably probable, legally permissible, physically possible, financially feasible use that produces the greatest value; it is the valuation premise for market value.

Agency relationships: vendor's agent (acts for seller), purchaser's agent (acts for buyer), and dual agency (acts for both, requires informed written consent from both parties).

Listing types: exclusive right to sell (commission payable however the sale arises during the term), exclusive agency (owner may sell without commission), open listing (commission to the introducing agent only).

Fixtures: items affixed to land so as to become part of it, determined by degree of annexation and intention of the parties; fixtures pass with the land, chattels do not unless included in the contract.

Marketing a property requires accurate material particulars; misdescription of area, tenure, or planning status exposes the salesman and the brokerage to liability and disciplinary action.

Torrens system: title is registered, not merely recorded. The Register Book and certificate of title are conclusive evidence of ownership, subject to overriding interests and fraud.

Registration of Titles Act: governs registration of land, indefeasibility of title, and the caveat mechanism; a caveat lodged with the Registrar protects an unregistered interest and prevents dealing without notice.

Real Estate (Dealers and Developers) Act: establishes the licensing regime for dealers and developers and the Real Estate Board; practising without a licence is an offence.

Strata Titles Act: allows individual ownership of units in a building plus shared ownership of common property through a strata corporation; the corporation maintains common areas and levies contributions.

Land Acquisition Act: sets out compulsory acquisition by the Crown, the declaration and notice procedure, and the right to claim compensation for land and injurious affection.

Rent Restriction Act: controls rents and recovery of possession for premises within its scope; a landlord must follow the statutory grounds and notice requirements before recovering possession.

Landlord and tenant law: a lease for a term exceeding one year should be registered to bind third parties; covenants on quiet enjoyment and repair are implied or expressly set out in the lease.

Property tax and transfer tax: transfer of land attracts stamp duty and transfer tax assessed on the consideration or market value; unpaid property tax is a charge on the land.

Contract essentials: offer, acceptance, consideration, intention to create legal relations, and capacity. A counter-offer destroys the original offer (no acceptance on new terms).

Statute of Frauds applies: a contract for the sale of land must be evidenced in writing and signed by the party to be charged or their authorised agent.

Agreement for sale: the standard structure is parties, property description, price, deposit, completion date, title conditions, and risk. The deposit is usually held by the vendor's attorney as stakeholder.

Vendor's title obligations: the vendor must show good and marketable title; the purchaser's attorney raises requisitions and objections within the stipulated period or loses the right to object.

Completion and closing: on completion the purchaser pays the balance, receives the instrument of transfer and duplicate certificate of title, and the transfer is stamped and registered.

Remedies: specific performance (court order compelling completion), damages for breach, rescission, and forfeiture of deposit. Time is generally of the essence in land contracts.

Misrepresentation: an untrue statement of fact inducing the contract gives the purchaser a right to rescind or claim damages; failure to disclose known latent defects in title is a separate matter.

Conditions precedent and subject-to clauses (e.g. subject to financing or planning approval) suspend completion until satisfied; if not satisfied within the stated period the contract may lapse.

Market value: the estimated amount for which an asset should exchange on the valuation date between a willing buyer and a willing seller in an arm's length transaction after proper marketing, with each acting knowledgeably, prudently, and without compulsion.

Sales comparison approach: value is derived by analysing recent comparable sales and applying adjustments for differences in date, location, size, condition, and tenure.

Income approach (investment method): value = net operating income ÷ capitalisation rate. Net operating income = gross income − vacancy allowance − operating expenses.

Cost approach: value = replacement or reproduction cost of improvements − accrued depreciation + land value. Used where there is no active market, e.g. special-purpose buildings.

Depreciation methods: straight-line (cost − residual) ÷ useful life; reducing balance applies a fixed percentage to the written-down value each year.

Gross rent multiplier = sale price ÷ gross annual rent; applied to a subject's gross rent to indicate value.

Capitalisation rate reflects risk and return; a lower cap rate implies higher value for the same income. Cap rate = net operating income ÷ value.

Reconciliation: the valuer weights the approaches, states the final opinion of value, and reports assumptions, limiting conditions, and the valuation date.

Mortgage: a charge over land securing repayment of a debt. The mortgagee's remedies on default include power of sale, foreclosure, appointment of a receiver, and action on the covenant to pay.

Equity of redemption: the mortgagor's right to redeem the property on payment of principal, interest, and costs; any provision that clamps this right is void.

Amortisation: a level payment covering interest and principal. Monthly payment on a reducing-balance loan: P = L × i ÷ [1 − (1 + i)^−n], where L is loan, i is monthly rate, n is number of months.

Loan-to-value ratio (LTV) = loan amount ÷ appraised value or purchase price, whichever is lower. A higher LTV normally means a higher interest rate or mortgage insurance requirement.

Debt service coverage ratio (DSCR) = net operating income ÷ annual debt service; lenders typically require a ratio above 1.0, commonly 1.2 or higher for investment property.

Interest types: fixed rate (constant over the term), variable rate (moves with a reference rate), and capped or discounted arrangements. Interest is normally calculated on the reducing balance.

Mortgagee's power of sale: arises on default; the mortgagee must give statutory notice, act in good faith to obtain a proper price, and account for any surplus to subsequent encumbrancers and the mortgagor.

Sources of residential finance in Jamaica include commercial banks, building societies, and the National Housing Trust; lenders assess income, credit history, and existing debt commitments.

Fiduciary duties of an agent: loyalty, obedience to lawful instructions, full disclosure of material facts, confidentiality, accounting for all monies, and avoiding undisclosed personal interest.

Commission is payable only under the terms of the agency agreement; a salesman may not accept secret commissions or referral fees from third parties without disclosure to and consent of the client.

Client money must be held in a designated trust or client account and accounted for promptly; commingling with the brokerage's operating funds is prohibited.

Anti-money-laundering obligations: customer due diligence, identification and verification of clients, source-of-funds checks, record keeping, and reporting of suspicious transactions to the competent authority.

Advertising and marketing must be truthful and not misleading; an agent may not advertise a property without the owner's authority or misstate price, size, or tenure.

Conflicts of interest must be disclosed in writing and managed; acting for both parties without informed written consent is a breach of duty and a disciplinary matter.

Confidentiality survives the end of the agency relationship, except where disclosure is required by law, by a court, or to prevent a crime.

Disciplinary consequences for breach include admonishment, conditions on the licence, suspension, or revocation, in addition to civil liability to the injured client.

The Real Estate Board administers licensing under the Real Estate (Dealers and Developers) Act; dealers, developers, and salesmen must be licensed and licences are renewed periodically.

A salesman must be employed and supervised by a licensed dealer; the salesman cannot independently operate a brokerage or hold client funds outside the employing dealer's arrangements.

Grounds for refusal, suspension, or revocation of a licence include dishonest or improper conduct, conviction for a relevant offence, and providing false information in an application.

Records and accounts of the brokerage must be kept and made available for inspection; failure to produce records on request is itself a compliance breach.

A licensed person must display or state licence details as required and must not use titles or imply qualifications they do not hold.

Changes in employment of a salesman must be notified to the Board; practising under a dealer who is not licensed is a breach for both parties.

Complaints are made to the Board, which may investigate and hold an inquiry; the licensee is entitled to notice of the allegations and an opportunity to respond before a sanction is imposed.

Co-ownership: joint tenancy carries the right of survivorship (the deceased's share passes to the surviving joint tenants); tenancy in common has no survivorship and shares pass under the will or intestacy.

Easement: a right of use over another's land (e.g. right of way); it must be registered to bind a purchaser for value, and an unregistered easement may be lost on a registered transfer to a bona fide purchaser.

Restrictive covenant: a covenant restricting use of land, which may run with the land in equity where it touches and concerns the land and is intended to benefit neighbouring land.

Adverse possession: long, open, exclusive possession without the owner's permission may extinguish the owner's title under the Limitation of Actions Act; the period and registration implications must be checked.

Lease essentials: parties, premises, term, rent, and covenants. A periodic tenancy renews automatically (e.g. month to month) and requires the statutory notice to terminate.

Security of tenure for residential tenants: the landlord must serve the prescribed notice and establish a statutory ground before applying for possession; self-help eviction (changing locks, removing belongings) is unlawful.

Dilapidations and repair: the tenant's repairing covenant is read with the schedule of condition; the landlord's covenant to repair common parts applies in strata and multi-unit buildings.

Planning and development permission is required for material change of use or development; a purchaser should verify permitted use, building approval, and any enforcement notices before completion.