CA Real Estate Sales Practice Exam!
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- 1.
Three of the following real estate terms are closely associated. Which term does not belong to the group?
- A.
Easement
- B.
Lien
- C.
Judgement
- D.
Attachment
Correct Answer
A. EasementExplanation
The terms "lien", "judgement", and "attachment" are all liens. An easement is not lien and does not belong to that group.Rate this question:
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- 2.
A restrictive covenant contained in a deed which prohibits sale to persons of a particular race will:
- A.
Invalidate the conveyance
- B.
Have no effect in the conveyance and the covenant will be unenforceable
- C.
Create the power in the grantee to void the conveyance
- D.
Retain in the grantor the power to enforce the covenant
Correct Answer
B. Have no effect in the conveyance and the covenant will be unenforceableExplanation
The racial restriction contained in deeds have been outlawed and are now illegal and unenforceable and would have no effect whatsoever.Rate this question:
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- 3.
Protective covenants which place restrictions on grantees of lots in a new subdivision would probably be found in the:
- A.
Original deed held by the subdivider
- B.
Recorded declaration of the restrictions
- C.
Zoning codes
- D.
Subdivision Map
Correct Answer
B. Recorded declaration of the restrictionsExplanation
The original subdivider will generally create a number of protective covenants for buyers of the properties within the subdivision. There are too many of these to list in each deed so he will create a complete list and record that, and that is known as the declaration of restrictions.Rate this question:
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- 4.
When a husband and wife hold title to property in joint tenancy, the wife can will;
- A.
One half of the husband's share
- B.
One half of the entire property
- C.
One half of her share
- D.
None of the property
Correct Answer
D. None of the propertyExplanation
Anyone holding an interest in a property as a joint tenant cannot will any part of their share.Rate this question:
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- 5.
A joint tenancy estate:
- A.
Is a single estate
- B.
Is an estate in severalty
- C.
Involves real property only
- D.
Involves personal property only
Correct Answer
A. Is a single estateExplanation
It is a single estate because the joint tenants hold title as though they collectively constitute one person. Both real and personal could be held in joint tenancy.Rate this question:
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- 6.
In real estate the word tenancy means:
- A.
Two or more people joined in an enterprise.
- B.
A mode of holding ownership
- C.
A tenacious person
- D.
A device
Correct Answer
B. A mode of holding ownershipExplanation
The word tenancy means a method or mode or means of holding ownership.Rate this question:
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- 7.
If Allen owns a freehold estate, which of the following actions would cause his interest to be converted to a less-than-freehold estate?
- A.
A grant of the mineral and oil rights therein to a third party
- B.
A grant of an easement for right of a way over the land
- C.
A leasing of the land for agricultural purposes to a third party for a period of five years
- D.
None of the above
Correct Answer
D. None of the aboveExplanation
If Allen holds a freehold estate he is the title holder. Any of the actions listed in other choices above, will not remove his title to the estate and he retains his freehold estate.Rate this question:
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- 8.
Three of the following real estate terms are closely associated. Which term does not belong with the group?
- A.
Heir
- B.
Executor
- C.
Sale
- D.
Will
Correct Answer
C. SaleExplanation
The other terms listed refer to wills. The word sale has no relationship with these terms.Rate this question:
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- 9.
Austin deeded Shady Acres to Jones for the life of Baker. Under these circumstances:
- A.
Jones holds a life estate and Austin an estate in remainder
- B.
Jones holds a life estate and Austin an estate in reversion
- C.
Jones holds a fee simple estate and Baker a life estate
- D.
Baker holds a life estate and Jones an estate in remainder
Correct Answer
B. Jones holds a life estate and Austin an estate in reversionExplanation
Jones hold the life estate and since Austin was the original grantor and the property will apparently be returned to him, Austin holds the estate in remainder.Rate this question:
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- 10.
You have agreed to lease a store building from the owner for a period of ten years at a total rental of $12,000.00 payable at the monthly rate of $100.00. $200.00 must be paid in advance which shall apply to the first and last month's rent. Considering the term agreed upon, it would be inappropriate to insert a clause in the terms of this lease covering which of the following?
- A.
Condemnation proceedings
- B.
Third party liability
- C.
Stock in a mutual water company
- D.
Escalation clause, tied to the cost of living index
Correct Answer
D. Escalation clause, tied to the cost of living indexExplanation
Since the lease calls for a set amount of rent each month, as escalator clause would not be considered a part of the contract termsRate this question:
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- 11.
Which of the following would be apurtenant to land?
- A.
Anything acquired by legal right that is to be used with the land for its benefit
- B.
A right of way over another owner's adjoining land
- C.
Stock in a mutual water company
- D.
All of the above
Correct Answer
D. All of the aboveExplanation
All of the items listed are considered to be appurtenant to the land.Rate this question:
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- 12.
An individual who receives $225 per month on a money market savings account that pays 7 1/2% per year has invested which of the following amounts?
- A.
$12,500
- B.
$27,000
- C.
$36,000
- D.
$48,000
Correct Answer
C. $36,000Explanation
$225 x 12 = $2,700 per year
$2,700 divided by 7.5% = $36,000Rate this question:
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- 13.
A man willed his property to his favorite nephew John, and his wife Jane, giving them a 2/3 and 1/3 interest respectively with the right of survivorship. Title would be held by John and Jane as:
- A.
Joint Tenants
- B.
Community property
- C.
Tenants in Common
- D.
Tenancy in Partnership
Correct Answer
C. Tenants in CommonExplanation
Since John and Jane hold unequal interest they cannot take title as joint tenants nor as community property. Since they are not in business together, California Law allows only one other type and that would be the tenants in common. There would be no right of survivorship permitted in this instance.Rate this question:
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- 14.
When real property is subleased, the interest held by the subleasor is commonly called:
- A.
A double lease
- B.
A freehold lease
- C.
An assignment
- D.
A sandwich lease
Correct Answer
D. A sandwich leaseExplanation
We have three parties involved in this contract. The owner, or Landlord, the tenant that occupies the premises and the sublessor who is in the middle of the two. That position is referred to as the sandwich lease.Rate this question:
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- 15.
An appraiser using the cost method may use the unit cost per square foot or cost per cubic foot in this computations. On a unit cost basis:
- A.
A small house would cost less than a large house
- B.
A large house would cost more than a small house
- C.
A small house would cost more than a large house
- D.
The cost of a small house and a large house would be the same
Correct Answer
C. A small house would cost more than a large houseExplanation
There are always a number of sizeable start-up costs in the construction of a new home. When you expand the size of the home the additional cost is proportionately not as great. Consider this, small home would cost a great deal more by the square foot than a large home.Rate this question:
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- 16.
A seller took back a second trust deed and note in the amount of $11,400 payable $240 per month, including interest at 7% per annum. If interest on the note begins July 15 and the first payment is made on August 15, the amount of the first payment that is applied to the principal is:
- A.
$66.50
- B.
$79.80
- C.
$173.50
- D.
$240.00
Correct Answer
C. $173.50Explanation
$11,400 x 7% = $798 per year
$798 divided by 12 = $66.50 per month
$240 - $66.50 = $173.50Rate this question:
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- 17.
The statement, "The value of the best property in a neighborhood will be adversely affected by the presence of comparatively substandard property", relates to one of the basic principles of value known as the principle of:
- A.
Balance
- B.
Contribution
- C.
Regression
- D.
Anticipation
Correct Answer
C. RegressionExplanation
The statement of the question illustrates the principle of regression.Rate this question:
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- 18.
Many organizations have developed over the years in the real estate appraisal field. Among them are the A.I.R.E.A and the S.R.E.A.. Which of the following is true relative to these two organization?
- A.
They are professional organizations of person who make residential appraisals
- B.
They are professional organizations founded in the 1930s
- C.
They are professional organizations that are international in scope
- D.
All of the above
Correct Answer
D. All of the aboveExplanation
All 3 choices are true statements regarding these professional organization.Rate this question:
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- 19.
A person working in real estate would know that the names "Inwood and Hoskold" would pertain to:
- A.
Estimating values
- B.
Private construction
- C.
Architectural design
- D.
A group of developers
Correct Answer
A. Estimating valuesExplanation
Inwood and Hoskold were two men who developed special tables in the appraisal of income properties. They pertain to estimating valuesRate this question:
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- 20.
"The relationship between a thing desired and a potential purchaser" is a definition of:
- A.
Value
- B.
The "economic man"
- C.
"Utility" as used in a definition of value
- D.
Need
Correct Answer
A. ValueExplanation
This is one of the definitions of valueRate this question:
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- 21.
Acme Finance Company hired an appraiser to appraise Mr. Thomas' property. As a matter of ethics the appraiser could discuss his findings with:
- A.
Acme Finance Company
- B.
Mr. Thomas
- C.
The listing broker
- D.
All of the above
Correct Answer
A. Acme Finance CompanyExplanation
The appraiser is only permitted to discuss his findings with the party that had originally hired him. In this case it would be the finance company.Rate this question:
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- 22.
In correlating the value estimates that the appraiser has secured under each of the three approaches to value the appraiser:
- A.
Simply average his estimates
- B.
Assigns weigh to the individual estimates and then averages them
- C.
Does both "A" and "B"
- D.
Does none of the above
Correct Answer
D. Does none of the aboveExplanation
When correlating the value estimates, the appraiser takes all the facts and weighs them to see whether they are of value or of no use. He will use the important items and dismiss the rest. It is not an averaging process.Rate this question:
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- 23.
All of the following would have an effect on the final estimate of value when making an appraisal of an old single family residence except:
- A.
Purpose of the appraisal
- B.
Suitability of the residence to the site
- C.
Physical condition of the building
- D.
Original cost of the residence
Correct Answer
D. Original cost of the residenceExplanation
Original cost has little or nothing to do with the value when applying the cost approach to an older structure.Rate this question:
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- 24.
Which of the following is the least important factor when appraising a site for commercial purpose?
- A.
Convenience of facility to shipping and labor sources
- B.
The community's purchasing power
- C.
Zoning regulations
- D.
Amenities
Correct Answer
D. AmenitiesExplanation
Amenities are pleasing features in or about the property. These are a major consideration in residential homes but would have little effect or influence on commercial sites.Rate this question:
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- 25.
The process of expressing anticipated future benefits of ownership in dollars and discounting them to a present worth at a rate which is attracting purchase capital to similar investments is called:
- A.
Projection
- B.
Yield evaluation
- C.
Equity manipulation
- D.
Capitalization
Correct Answer
D. CapitalizationExplanation
The statement of the question is a means of describing the income approach which is used to establish the value of income property. It is also referred to as the capitalization approach.Rate this question:
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Current Version
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Nov 16, 2023Quiz Edited by
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May 01, 2011Quiz Created by
Kalidatu
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