Texas Real Estate State Practice Exam

What are the four economic characteristics of land?

1. Metes and Bounds, Lot, Block, and Subdivision, Monuments, Rectangular/ Government Survey

2. Modification, Scarcity, Situs, Durability

3. Indestructibility, Fixity, Situs, Monuments

4. Scarcity, Modification, Fixity, Situs

The correct answer is: Scarcity, Modification, Fixity, Situs

The four economic characteristics of land are Scarcity, Modification, Fixity, and Situs. Scarcity refers to the limited supply of land, which can increase its value based on demand. This concept highlights that land is a finite resource, meaning that as the population grows, the competition for land tends to increase, leading to higher values. Modification speaks to how land can be altered or improved through various means, such as construction or development. Changes made to land can significantly enhance its value and usability, illustrating how human efforts can contribute to the economic potential of a property. Fixity addresses the permanence of land; once land is developed or improved, those changes are generally lasting. This characteristic emphasizes that land does not move or diminish in the same way that other assets might, contributing to its long-term value. Situs is the location of the land, which can greatly affect its desirability and market value. The specific characteristics and attributes of a location, including accessibility, neighborhood dynamics, and local amenities, play a crucial role in determining how much land is worth. Collectively, these four characteristics inform how land is valued and traded within the real estate market in Texas and beyond.