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Principles of Real Estate 1 EXAM REVIEW 2024 Questions and Answers
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Principles of Real Estate 1 EXAM REVIEW
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Principles of Real Estate 1 EXAM REVIEWWhich of the following is an example of a limited common element? - Answer- Parking Space
A married couple buys a home for $400,000. Five years later, they sell it for $550,000. How much of their sale is taxable capital gain? - Answer- $0. They get a $500,000 capital gains tax exclusion, and they made $150,000 in profit, so all of their profit is excluded from taxation.
Arthur, Beatrice, Candace, Dmitri, and Evenlyn bought a property does each of them own? - Answer- 20%. They share the unity of interest, they each own an equal share 1/5 or 20 percent.
The following are all common types of unilateral contracts, EXCEPT - Answer- Purchase Agreements
Reward offers, contests, and commissions are common types of unilateral contracts that you are likely to encounter.
An owner lives in a single family dwelling but only owns the building. The homeowners association owns and maintains the grounds, the pool, and the exercise room. All of the owners in the area share the common areas. What does the owner live in? - Answer- A condominium
Which of the following is NOT a unique characteristic of land that also sets it apart from personal property? - Answer- Malleability One way land is special and separate from personal property is that it has three unique physical characteristics, inmobility, indestructibility and non homogeneity.
According to what legal concept do contracts involving the sale or transfer of real estate need to be in writing? - Answer- Statute of Frauds
The statute of frauds that real estate contracts be in writing in order to be enforceable in
court. Attachments can be natural or manmade. Those that are manmade are commonly known as what? - Answer- Fixtures
Manmade attachments to land are commonly known as fixtures
In what kind of contract is only one of the parties obligated to perform? - Answer- Unilateral A unilateral contract, where one of the contracting parties is bound to act. It is a contract
made between two or more parties in which only one of those parties makes a promise or otherwise accepts an obligation
An agent owes the duty of obedience to which of the following people? - Answer- The client (the principal)
The duties of an agent to the principal include fidelity and loyalty, and reasonable care, and competency, obedience, accounting, and disclosure.
Which of these are TRELA's protected classes? - Answer- Race, color, religion, sex, disability, familial status, national origin, and ancestry.
Stealing a client from another license holder is - Answer- Grounds for losing your license
What does severance mean? - Answer- Turning real property into personal property.
Peter's home is being foreclosed on. He owes $3,700 in property taxes. He owes $11,000 on the second mortgage he took out in 2017. He also owes $215,000 on his original mortgage, which was taken out in 2013. According to lien priority, after the taxes
are paid, which debt is most likely to be paid next, and why? - Answer- The primary mortgage, because debts are paid in the order they were recorded. Lien priority states that tax debt goes first, then the "first in time is first in line" rule applies. Debts are paid in the order they are recorded, unless there is a subordination clause at work.
Which of these requires a higher standard than ethics laws. - Answer- NAR Code of Ethics
The National Association of REALTORS Code of Ethics requires a higher standard than
ethical laws.
Which canon states to treat all parties honestly and fairly? - Answer- The canon of fidelity
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