HOGAN REAL ESTATE EXAM | QUESTIONS AND ANSWERS |
VERIFIED ANSWERS PLUS RATIONALES | EXAM ALREADY
GRADED A+ | LATEST EXAM
1. Which of the following is considered real property?
A. A freestanding refrigerator
B. A ceiling fan attached to the ceiling
C. A sofa
D. A painting on the wall
Answer: B. A ceiling fan attached to the ceiling
Rationale: Real property includes fixtures that are permanently attached to the land or
building.
2. A buyer makes an offer on a property, and the seller accepts it with no changes.
This is an example of:
A. Counteroffer
B. Acceptance
C. Rejection
D. Escrow
Answer: B. Acceptance
Rationale: Acceptance occurs when the seller agrees to the terms of the buyer’s offer
without modification.
3. Which of the following best describes “eminent domain”?
A. The right of a property owner to subdivide land
B. Government taking private property for public use
C. A landlord evicting a tenant
D. Zoning restrictions on property
Answer: B. Government taking private property for public use
Rationale: Eminent domain allows the government to take private property for public
purposes with compensation.
4. Which type of listing gives the broker the right to earn a commission even if the
owner sells the property themselves?
A. Exclusive agency listing
B. Open listing
C. Exclusive right-to-sell listing
D. Net listing
Answer: C. Exclusive right-to-sell listing
Rationale: Exclusive right-to-sell listings guarantee the broker a commission regardless
of who sells the property.
5. Which document conveys ownership of real estate from seller to buyer?
A. Lease
B. Deed
C. Mortgage
D. Note
, Answer: B. Deed
Rationale: A deed is the legal instrument used to transfer property ownership.
6. A property’s market value is best defined as:
A. The price paid by the first buyer
B. The price the seller wants
C. The most probable price in a competitive market
D. The assessed value for tax purposes
Answer: C. The most probable price in a competitive market
Rationale: Market value reflects what a typical buyer would pay in an open market.
7. Which of the following is a unilateral contract?
A. Lease agreement
B. Sales contract
C. Option contract
D. Purchase agreement
Answer: C. Option contract
Rationale: A unilateral contract binds only one party to perform if the other party
chooses to act.
8. The legal principle stating that a previous court decision sets a standard for future
similar cases is:
A. Stare decisis
B. Res judicata
C. Laches
D. Estoppel
Answer: A. Stare decisis
Rationale: Stare decisis ensures consistency by following prior judicial decisions.
9. Which of the following types of property is considered personal property?
A. Land
B. Mobile home not attached to land
C. Trees planted in the soil
D. Attached garage
Answer: B. Mobile home not attached to land
Rationale: Personal property is movable and not permanently attached to real estate.
10. Which fiduciary duty requires the agent to put the client’s interests above their
own?
A. Obedience
B. Loyalty
C. Disclosure
D. Accounting
Answer: B. Loyalty
Rationale: Loyalty obligates the agent to prioritize the client’s interests over personal
gain.
11. Which type of deed provides the greatest protection to the buyer?
A. Quitclaim deed
B. Bargain and sale deed
C. Special warranty deed
D. General warranty deed
, Answer: D. General warranty deed
Rationale: A general warranty deed guarantees clear title and full ownership protection
against all claims.
12. A real estate broker holds funds on behalf of a client in a separate account. This is
called:
A. Commingling
B. Conversion
C. Escrow
D. Trust account
Answer: D. Trust account
Rationale: Brokers must keep client funds in a separate trust account to avoid misuse.
13. Which type of property ownership allows two or more people to own equal shares
with right of survivorship?
A. Tenancy in common
B. Joint tenancy
C. Severalty
D. Cooperative
Answer: B. Joint tenancy
Rationale: Joint tenancy includes equal ownership and right of survivorship upon death.
14. The difference between the property’s market value and any outstanding liens is
called:
A. Equity
B. Appreciation
C. Capital gain
D. Depreciation
Answer: A. Equity
Rationale: Equity represents the owner’s financial interest after debts are subtracted.
15. Which of the following is an example of functional obsolescence?
A. Roof leak
B. Outdated floor plan
C. Foundation cracks
D. Termite damage
Answer: B. Outdated floor plan
Rationale: Functional obsolescence occurs when a feature reduces property value due to
design or utility limitations.
16. Which law requires sellers to disclose known material defects of a property?
A. RESPA
B. Fair Housing Act
C. Property Disclosure Law
D. Sherman Act
Answer: C. Property Disclosure Law
Rationale: Sellers must inform buyers of known defects affecting safety or value.
17. Which type of mortgage allows the borrower to pay interest only for a set period
before principal payments begin?
A. Fixed-rate mortgage
B. Balloon mortgage
, C. Adjustable-rate mortgage
D. Interest-only mortgage
Answer: D. Interest-only mortgage
Rationale: Interest-only loans reduce early payments but eventually require principal
repayment.
18. A real estate agent who represents both buyer and seller in the same transaction
must:
A. Disclose dual agency
B. Ignore conflicts of interest
C. Only represent the seller
D. Only represent the buyer
Answer: A. Disclose dual agency
Rationale: Dual agency must be disclosed and agreed to by both parties.
19. Which of the following is a government restriction on land use?
A. Easement
B. Zoning
C. Lien
D. Lease
Answer: B. Zoning
Rationale: Zoning laws regulate property usage and development.
20. The process by which a property’s value is increased due to improvements in the
surrounding area is called:
A. Contribution
B. Progression
C. Regression
D. Assemblage
Answer: B. Progression
Rationale: Progression occurs when less valuable property benefits from nearby higher-
value properties.
21. Which appraisal approach estimates value based on recent sales of similar
properties?
A. Cost approach
B. Income approach
C. Sales comparison approach
D. Gross rent multiplier
Answer: C. Sales comparison approach
Rationale: This approach compares similar properties’ sale prices to estimate market
value.
22. Which type of lease requires the tenant to pay property taxes, insurance, and
maintenance in addition to rent?
A. Gross lease
B. Net lease
C. Percentage lease
D. Graduated lease
Answer: B. Net lease
Rationale: Net leases shift operational costs to the tenant.
VERIFIED ANSWERS PLUS RATIONALES | EXAM ALREADY
GRADED A+ | LATEST EXAM
1. Which of the following is considered real property?
A. A freestanding refrigerator
B. A ceiling fan attached to the ceiling
C. A sofa
D. A painting on the wall
Answer: B. A ceiling fan attached to the ceiling
Rationale: Real property includes fixtures that are permanently attached to the land or
building.
2. A buyer makes an offer on a property, and the seller accepts it with no changes.
This is an example of:
A. Counteroffer
B. Acceptance
C. Rejection
D. Escrow
Answer: B. Acceptance
Rationale: Acceptance occurs when the seller agrees to the terms of the buyer’s offer
without modification.
3. Which of the following best describes “eminent domain”?
A. The right of a property owner to subdivide land
B. Government taking private property for public use
C. A landlord evicting a tenant
D. Zoning restrictions on property
Answer: B. Government taking private property for public use
Rationale: Eminent domain allows the government to take private property for public
purposes with compensation.
4. Which type of listing gives the broker the right to earn a commission even if the
owner sells the property themselves?
A. Exclusive agency listing
B. Open listing
C. Exclusive right-to-sell listing
D. Net listing
Answer: C. Exclusive right-to-sell listing
Rationale: Exclusive right-to-sell listings guarantee the broker a commission regardless
of who sells the property.
5. Which document conveys ownership of real estate from seller to buyer?
A. Lease
B. Deed
C. Mortgage
D. Note
, Answer: B. Deed
Rationale: A deed is the legal instrument used to transfer property ownership.
6. A property’s market value is best defined as:
A. The price paid by the first buyer
B. The price the seller wants
C. The most probable price in a competitive market
D. The assessed value for tax purposes
Answer: C. The most probable price in a competitive market
Rationale: Market value reflects what a typical buyer would pay in an open market.
7. Which of the following is a unilateral contract?
A. Lease agreement
B. Sales contract
C. Option contract
D. Purchase agreement
Answer: C. Option contract
Rationale: A unilateral contract binds only one party to perform if the other party
chooses to act.
8. The legal principle stating that a previous court decision sets a standard for future
similar cases is:
A. Stare decisis
B. Res judicata
C. Laches
D. Estoppel
Answer: A. Stare decisis
Rationale: Stare decisis ensures consistency by following prior judicial decisions.
9. Which of the following types of property is considered personal property?
A. Land
B. Mobile home not attached to land
C. Trees planted in the soil
D. Attached garage
Answer: B. Mobile home not attached to land
Rationale: Personal property is movable and not permanently attached to real estate.
10. Which fiduciary duty requires the agent to put the client’s interests above their
own?
A. Obedience
B. Loyalty
C. Disclosure
D. Accounting
Answer: B. Loyalty
Rationale: Loyalty obligates the agent to prioritize the client’s interests over personal
gain.
11. Which type of deed provides the greatest protection to the buyer?
A. Quitclaim deed
B. Bargain and sale deed
C. Special warranty deed
D. General warranty deed
, Answer: D. General warranty deed
Rationale: A general warranty deed guarantees clear title and full ownership protection
against all claims.
12. A real estate broker holds funds on behalf of a client in a separate account. This is
called:
A. Commingling
B. Conversion
C. Escrow
D. Trust account
Answer: D. Trust account
Rationale: Brokers must keep client funds in a separate trust account to avoid misuse.
13. Which type of property ownership allows two or more people to own equal shares
with right of survivorship?
A. Tenancy in common
B. Joint tenancy
C. Severalty
D. Cooperative
Answer: B. Joint tenancy
Rationale: Joint tenancy includes equal ownership and right of survivorship upon death.
14. The difference between the property’s market value and any outstanding liens is
called:
A. Equity
B. Appreciation
C. Capital gain
D. Depreciation
Answer: A. Equity
Rationale: Equity represents the owner’s financial interest after debts are subtracted.
15. Which of the following is an example of functional obsolescence?
A. Roof leak
B. Outdated floor plan
C. Foundation cracks
D. Termite damage
Answer: B. Outdated floor plan
Rationale: Functional obsolescence occurs when a feature reduces property value due to
design or utility limitations.
16. Which law requires sellers to disclose known material defects of a property?
A. RESPA
B. Fair Housing Act
C. Property Disclosure Law
D. Sherman Act
Answer: C. Property Disclosure Law
Rationale: Sellers must inform buyers of known defects affecting safety or value.
17. Which type of mortgage allows the borrower to pay interest only for a set period
before principal payments begin?
A. Fixed-rate mortgage
B. Balloon mortgage
, C. Adjustable-rate mortgage
D. Interest-only mortgage
Answer: D. Interest-only mortgage
Rationale: Interest-only loans reduce early payments but eventually require principal
repayment.
18. A real estate agent who represents both buyer and seller in the same transaction
must:
A. Disclose dual agency
B. Ignore conflicts of interest
C. Only represent the seller
D. Only represent the buyer
Answer: A. Disclose dual agency
Rationale: Dual agency must be disclosed and agreed to by both parties.
19. Which of the following is a government restriction on land use?
A. Easement
B. Zoning
C. Lien
D. Lease
Answer: B. Zoning
Rationale: Zoning laws regulate property usage and development.
20. The process by which a property’s value is increased due to improvements in the
surrounding area is called:
A. Contribution
B. Progression
C. Regression
D. Assemblage
Answer: B. Progression
Rationale: Progression occurs when less valuable property benefits from nearby higher-
value properties.
21. Which appraisal approach estimates value based on recent sales of similar
properties?
A. Cost approach
B. Income approach
C. Sales comparison approach
D. Gross rent multiplier
Answer: C. Sales comparison approach
Rationale: This approach compares similar properties’ sale prices to estimate market
value.
22. Which type of lease requires the tenant to pay property taxes, insurance, and
maintenance in addition to rent?
A. Gross lease
B. Net lease
C. Percentage lease
D. Graduated lease
Answer: B. Net lease
Rationale: Net leases shift operational costs to the tenant.
