California Real Estate Salesperson practice questions
227 free questions with answers and explanations.
- 101.A licensed salesperson working for a broker, while showing a listed home, tells prospective buyers that the roof was replaced last year when in fact it was never replaced, and the salesperson never verified this claim. The buyers purchase the home and later sue for fraud. Under California agency law, who may be held liable?Laws of Agency and Fiduciary Duties
- 102.A developer plans to subdivide raw land into 8 residential lots for sale to the public in California. Under the Subdivided Lands Act, which of the following is required before the developer can sell or lease any of the lots?Property Ownership and Land Use Controls
- 103.A buyer and seller sign a written real estate purchase agreement. The seller later breaches, and the buyer wants to sue for breach of the written contract. Under California Code of Civil Procedure, what is the statute of limitations for filing suit on this written contract?Contracts
- 104.A responsible broker fails to review and approve any of the purchase contracts prepared by the salespersons in the office over an 18-month period. The DRE later investigates a fraud complaint against one of the salespersons. What is the most likely basis for disciplinary action against the broker?Practice of Real Estate and Disclosures
- 105.A broker wants to place trust fund deposits into an interest-bearing account. Under California law, which condition must be met before doing so?Practice of Real Estate and Disclosures
- 106.A modest, well-kept three-bedroom home is located in a neighborhood dominated by much larger, higher-value homes. Because of its surroundings, the modest home's value is pulled upward compared to an identical home located in a neighborhood of similarly modest homes. This effect illustrates which principle?Property Valuation and Financial Analysis
- 107.A buyer receives a preliminary title report from a title company before close of escrow. What is the correct legal significance of this document?Transfer of Property
- 108.A building has a reproduction cost new of $300,000 and an estimated economic life of 50 years. If the building's effective age is 10 years, what is the amount of accrued depreciation using the straight-line (age-life) method?Property Valuation and Financial Analysis
- 109.A homeowner signs a listing agreement stating the broker will earn a commission only if that specific broker procures a buyer; the homeowner retains the right to sell the property independently without owing any commission. What type of listing is this?Contracts
- 110.A deed reads, 'I hereby convey Blackacre to John Smith and his heirs,' with no other conditions or limitations stated. What estate does John Smith receive?Property Ownership and Land Use Controls
- 111.An appraiser is calculating total accrued depreciation on a building with a reproduction cost new of $400,000. Two items are identified as curable physical deterioration: worn carpeting and interior paint, which together will cost $20,000 to cure. After removing this curable amount, the appraiser applies incurable physical deterioration to the remaining cost based on an effective age of 8 years and a total economic life of 40 years. What is the total accrued depreciation?Property Valuation and Financial Analysis
- 112.A city council rezones one small parcel surrounded entirely by single-family homes to allow a gas station, benefiting only that parcel's owner and inconsistent with the surrounding residential character. This zoning action is an example of:Property Ownership and Land Use Controls
- 113.A homeowner grants their neighbor the right to cross a strip of their backyard to reach a public lake, and this right is tied to ownership of the neighbor's lot rather than to the neighbor personally. This is an example of:Property Ownership and Land Use Controls
- 114.A seller signs a listing agreement with a broker. Under Civil Code Section 2079.14, when must the listing agent have already provided the seller with the Agency Disclosure Form?Laws of Agency and Fiduciary Duties
- 115.A newly licensed salesperson asks her broker to describe the standard of care a real estate agent owes to their principal. Which comparison best describes this fiduciary duty under California law?Laws of Agency and Fiduciary Duties
- 116.A promissory note is secured by a deed of trust on real property. After the borrower defaults, the lender files a lawsuit seeking only a personal money judgment against the borrower, without first foreclosing on the security. Under California's one-action rule, what is the primary consequence for the lender?Financing
- 117.During a showing, a listing agent tells prospective buyers, 'This is the best block in the whole neighborhood,' and also states, 'The roof was replaced just two years ago,' when in fact the roof is the original 30-year-old roof. Which statement exposes the agent to liability for misrepresentation?Laws of Agency and Fiduciary Duties
- 118.A listing broker presents the seller with a buyer who is ready, willing, and able to purchase the property at the seller's exact listed price and terms, but the seller arbitrarily refuses to complete the sale. Is the broker entitled to a commission?Laws of Agency and Fiduciary Duties
- 119.Three individuals form a general partnership to acquire and develop commercial real estate. Title to the property is taken in the partnership's name for partnership business purposes. This method of holding title is called:Property Ownership and Land Use Controls
- 120.A tenant's landlord fails to repair a broken heater despite written notice and a reasonable time to fix it. Under California's repair-and-deduct remedy, the tenant may deduct the reasonable cost of repairs from rent, subject to which limitation?Practice of Real Estate and Disclosures
- 121.A city's environmental review determines that a proposed 20-unit infill housing project will have no significant effect on the environment based on an initial study. Under CEQA, what document should the city prepare?Property Ownership and Land Use Controls
- 122.An appraiser is using the land residual technique to value a parcel of land. The building on the site is valued at $600,000 and building investments in this market command a 9% return. The property's total annual NOI is $80,000, and land in this market commands a 7% return. What is the indicated value of the land?Property Valuation and Financial Analysis
- 123.Owner Chen conveys a parcel to Diaz, but Diaz never records the deed. Diaz later conveys the same parcel to Evans, who promptly records his deed. Sometime afterward, Chen fraudulently sells the same parcel to Foster, a bona fide purchaser who searches the public records only under Chen's name and finds no prior conveyance out of Chen. What is the legal effect of Evans's recorded deed on Foster's claim?Transfer of Property
- 124.A buyer is choosing between two nearly identical new homes in the same subdivision, both with the same square footage, lot size, and finishes. Home A is listed at $350,000 and Home B, with equal utility and desirability, is listed at $340,000. According to appraisal theory, a rational buyer will pay no more for a property than the cost of acquiring an equally desirable substitute. Which appraisal principle does this describe?Property Valuation and Financial Analysis
- 125.A broker advertises a 'Guaranteed Sale Program' promising to purchase a seller's home directly if it does not sell within a specified time period. Under California law, what must the broker do before entering into a listing agreement using this program?Practice of Real Estate and Disclosures
- 126.A city approves a new zoning ordinance that directly conflicts with the land use designations in the city's adopted general plan. Under California law, this zoning ordinance is:Property Ownership and Land Use Controls
- 127.A seller's agent is aware that an elderly tenant died of natural causes in the home four years before the property is listed for sale. Under California law, the seller and agent's disclosure obligation regarding this death is:Practice of Real Estate and Disclosures
- 128.A licensee is representing the personal representative in the sale of a decedent's property through a probate proceeding. Which statement about the Transfer Disclosure Statement (TDS) is correct?Practice of Real Estate and Disclosures
- 129.A licensee is asked by a seller to help facilitate a sale through a trustee's deed following a foreclosure. Which statement about the Transfer Disclosure Statement (TDS) is correct for this transaction?Practice of Real Estate and Disclosures
- 130.A married couple takes title to their home as 'community property with right of survivorship.' Upon the husband's death, what happens to his half interest?Property Ownership and Land Use Controls
- 131.A property appraises for $400,000, and the buyer's lender approves a loan of $320,000 to finance the purchase. What is the loan-to-value (LTV) ratio?Financing
- 132.A four-bedroom home has only one bathroom, and the floor plan makes adding a second bathroom structurally impractical without a costly major renovation. What type of depreciation does this represent?Property Valuation and Financial Analysis
- 133.Broker Alvarez's exclusive listing with a seller expires without a sale. Two months later, Alvarez begins representing a different buyer client and negotiates that buyer's purchase of the very same property from the same seller. During the earlier listing, Alvarez had learned that the seller was under significant financial pressure and would accept far less than the asking price. May Alvarez disclose or use that information to help the new buyer negotiate a lower price?Laws of Agency and Fiduciary Duties
- 134.A seller instructs a broker to sell a home for $500,000, agreeing the broker may keep any amount received above that price as compensation instead of a stated commission. In California, this type of listing arrangement is:Contracts
- 135.An annual property tax bill of $4,800 covers the fiscal tax year of July 1 through June 30. The seller already paid the entire year's tax bill in advance. Escrow closes on May 1. Using standard proration practice, how much should the buyer reimburse the seller at closing for the prepaid taxes covering the period after closing?Transfer of Property
- 136.A title search reveals a decades-old deed of trust that was actually paid off in full but was never formally reconveyed, creating a technical cloud on title. Despite this defect, a title company agrees to issue a policy insuring over the old deed of trust for an additional premium. What does this scenario best illustrate?Transfer of Property
- 137.A tenant's rental unit has a broken window that lets in rain, resulting in mold growth. The landlord refuses to make repairs despite written notice. Which legal doctrine obligates the landlord to maintain the unit in a habitable condition?Practice of Real Estate and Disclosures
- 138.A buyer, seller, and broker agree to substitute a new buyer into an existing purchase agreement, with the seller releasing the original buyer from all further obligations and accepting the new buyer's performance instead. This type of agreement is known as:Contracts
- 139.A buyer and seller sign a written purchase agreement for a home. The agreement states that the buyer will pay $400,000 in exchange for the seller conveying title. What element of a valid contract does the buyer's $400,000 payment represent?Contracts
- 140.A buyer signs a purchase agreement for a unique historic property with distinctive architectural features that cannot be duplicated elsewhere. The seller later refuses to close without legal justification. Because monetary damages would be inadequate to compensate the buyer, a court is most likely to grant which remedy?Contracts
- 141.A team of salespersons operating under a broker uses the name 'Prestige Home Sellers' in all advertising, without referencing the broker's name. Under California DRE advertising rules, this practice is:Practice of Real Estate and Disclosures
- 142.A 17-year-old signs a purchase agreement to buy a condo using funds from a trust fund. Before closing, the seller discovers the buyer's age. What is the legal status of this contract?Contracts
- 143.A salesperson spends several weekends driving a prospective purchaser to view homes, discusses the purchaser's financing options, and helps her draft an offer—all without ever having the purchaser sign a written buyer representation agreement. Based on this conduct, what type of agency relationship has most likely been created?Laws of Agency and Fiduciary Duties
- 144.A property owner allows an unlicensed friend to sit at the closing table, sign documents, and negotiate terms on several occasions without objection, even though no written agency agreement exists. A buyer relies on the friend's apparent authority and later sues when a promise made by the friend is not honored. What legal theory would most likely bind the owner to the friend's representations?Laws of Agency and Fiduciary Duties
- 145.An appraiser is using the cost approach on a property. The reproduction cost of the improvements is $400,000, total accrued depreciation is estimated at $80,000, and the land value is $100,000. What is the indicated value of the property?Property Valuation and Financial Analysis
- 146.According to DRE regulations, a broker may keep personal funds in the trust account for which specific purpose, and up to what amount?Practice of Real Estate and Disclosures
- 147.Which of the following must be disclosed on the Natural Hazard Disclosure (NHD) Statement to a buyer?Practice of Real Estate and Disclosures
- 148.A broker holds a limited power of attorney coupled with a financial interest in property she is authorized to sell on behalf of an incapacitated principal, using proceeds to satisfy a debt owed to her. Which characteristic distinguishes this arrangement from an ordinary agency relationship?Laws of Agency and Fiduciary Duties
- 149.A married couple in California holds title to their home as community property. Upon the death of one spouse without a will, what happens to the deceased spouse's one-half interest?Property Ownership and Land Use Controls
- 150.A broker represents both the buyer and seller as a disclosed dual agent. The seller privately tells the broker she would accept as little as $410,000, though the listing price is $450,000. Without the seller's further authorization, what may the broker disclose to the buyer?Laws of Agency and Fiduciary Duties