2026/2027
PSI National Real Estate Broker and
Salesperson Exam 2026/2027 Full-
Length Study Guide with Exam
Review, Practice Test Bank, and
Certification Preparation Questions
Question 1
A written agreement in which one party agrees to buy real property and another party
agrees to sell that property under stated terms and conditions is known as which of the
following?
A. A leasehold agreement
B. A listing agreement
C. A contract
D. An easement
Correct Answer: C. A contract
Rationale: A contract is a legally enforceable agreement between two or more parties
that outlines promises, obligations, and rights. In real estate transactions, purchase
contracts establish the duties of both buyer and seller and become binding once all
parties agree to the terms. A leasehold agreement concerns rental rights, a listing
agreement governs the relationship between seller and broker, and an easement grants
limited use of another’s property rather than transferring ownership.
Question 2
Which of the following actions would constitute a violation of federal antitrust laws in
the real estate industry?
A. Brokers independently advertising their services
B. Competing brokers agreeing to charge identical commission rates
C. Salespersons marketing properties through the MLS
D. Brokers offering different commission structures
Correct Answer: B. Competing brokers agreeing to charge identical commission
rates
Rationale: Antitrust laws protect consumers and encourage fair competition in the
marketplace. Price fixing occurs when competing brokers agree to charge the same
commission rates, limiting competition and consumer choice. Such conduct is illegal
,2026/2027
under federal antitrust laws. Independent advertising and flexible commission
structures are lawful business practices because they encourage competition rather
than restrict it.
Question 3
A municipality installs a sewer line along a rural roadway and assesses nearby
property owners for the improvement. Which individuals are MOST likely
responsible for sharing the cost?
A. Future property buyers only
B. Current owners whose properties front the roadway
C. The state government exclusively
D. Tenants renting nearby homes
Correct Answer: B. Current owners whose properties front the roadway
Rationale: Infrastructure improvements such as sewer systems are commonly funded
through special assessments imposed on benefiting property owners. Since the owners
whose properties front the roadway directly benefit from the sewer installation, they
are generally responsible for contributing toward the cost. Tenants do not typically
pay special assessments, and the burden is not usually deferred to future buyers.
Question 4
State laws vary regarding whether a seller must disclose which of the following
circumstances to a buyer?
A. The property taxes for the previous year
B. A suicide that occurred in the home last year
C. Existing zoning classifications
D. The age of the roof
Correct Answer: B. A suicide that occurred in the home last year
Rationale: Events such as deaths, suicides, or alleged paranormal activity are
considered psychological stigmas rather than physical defects. Disclosure
requirements for these events differ among states. Physical conditions such as roof
age and zoning issues are material facts more commonly required to be disclosed
because they directly affect the property’s value or use.
Question 5
A property owner claims that government action has significantly reduced the value
or usability of the property without formally taking title. Which legal action may the
owner pursue?
,2026/2027
A. Partition suit
B. Inverse condemnation lawsuit
C. Quiet title action
D. Specific performance claim
Correct Answer: B. Inverse condemnation lawsuit
Rationale: Inverse condemnation occurs when government action effectively deprives
an owner of the beneficial use of property without formally exercising eminent
domain. The property owner may sue to recover compensation for the loss. Partition
suits involve co-owners, quiet title actions resolve ownership disputes, and specific
performance enforces contractual obligations.
Question 6
Under federal fair housing laws, racial discrimination in the rental of residential
property is permitted under which circumstances?
A. When the owner occupies the property
B. In owner-financed transactions only
C. Under no circumstances
D. When the tenant agrees in writing
Correct Answer: C. Under no circumstances
Rationale: Federal fair housing laws strictly prohibit racial discrimination in housing
transactions. Race is a protected class under the Civil Rights Act of 1866 and the Fair
Housing Act of 1968. Landlords, brokers, and property managers may not refuse to
rent, negotiate differently, or otherwise discriminate based on race.
Question 7
A real estate broker listing a residential property should personally verify which of the
following details to avoid potential liability?
A. The seller’s marital status
B. The estimated future market value
C. The number of square feet in the structure
D. The buyer’s mortgage qualification
Correct Answer: C. The number of square feet in the structure
Rationale: Square footage is considered a material fact that may influence a buyer’s
decision. Brokers should verify measurements rather than relying solely on the
seller’s statements to avoid negligent misrepresentation claims. Marital status and
buyer qualification are unrelated to property measurement responsibilities, and future
market value is speculative.
, 2026/2027
Question 8
Real property may legally become personal property through which process?
A. Accession
B. Annexation
C. Severance
D. Avulsion
Correct Answer: C. Severance
Rationale: Severance occurs when an item attached to real property is detached,
thereby converting it into personal property. Examples include cutting down trees or
removing built-in fixtures. Annexation is the opposite process, where personal
property becomes part of the real estate.
Question 9
Buyers submitted an offer on a property. The seller rejected the original offer and
issued a counteroffer. Before the counteroffer was accepted, the buyers made an offer
on another property, which was accepted. Later, the buyers accepted the original
seller’s counteroffer. Which statement is TRUE?
A. Only the first contract is enforceable
B. Only the second contract is enforceable
C. Both contracts are legally valid
D. Neither contract is enforceable without additional consideration
Correct Answer: C. Both contracts are legally valid
Rationale: Buyers may legally enter into multiple contracts simultaneously unless one
agreement specifically prohibits doing so. Once the buyers accepted the counteroffer
and it was communicated to the seller, a binding contract was formed. The existence
of another accepted contract does not automatically invalidate either agreement.
Question 10
In many western states where water is scarce, water rights are often governed by
which legal doctrine?
A. Littoral rights
B. Riparian rights
C. Prior appropriation
D. Accretion doctrine
Correct Answer: C. Prior appropriation
PSI National Real Estate Broker and
Salesperson Exam 2026/2027 Full-
Length Study Guide with Exam
Review, Practice Test Bank, and
Certification Preparation Questions
Question 1
A written agreement in which one party agrees to buy real property and another party
agrees to sell that property under stated terms and conditions is known as which of the
following?
A. A leasehold agreement
B. A listing agreement
C. A contract
D. An easement
Correct Answer: C. A contract
Rationale: A contract is a legally enforceable agreement between two or more parties
that outlines promises, obligations, and rights. In real estate transactions, purchase
contracts establish the duties of both buyer and seller and become binding once all
parties agree to the terms. A leasehold agreement concerns rental rights, a listing
agreement governs the relationship between seller and broker, and an easement grants
limited use of another’s property rather than transferring ownership.
Question 2
Which of the following actions would constitute a violation of federal antitrust laws in
the real estate industry?
A. Brokers independently advertising their services
B. Competing brokers agreeing to charge identical commission rates
C. Salespersons marketing properties through the MLS
D. Brokers offering different commission structures
Correct Answer: B. Competing brokers agreeing to charge identical commission
rates
Rationale: Antitrust laws protect consumers and encourage fair competition in the
marketplace. Price fixing occurs when competing brokers agree to charge the same
commission rates, limiting competition and consumer choice. Such conduct is illegal
,2026/2027
under federal antitrust laws. Independent advertising and flexible commission
structures are lawful business practices because they encourage competition rather
than restrict it.
Question 3
A municipality installs a sewer line along a rural roadway and assesses nearby
property owners for the improvement. Which individuals are MOST likely
responsible for sharing the cost?
A. Future property buyers only
B. Current owners whose properties front the roadway
C. The state government exclusively
D. Tenants renting nearby homes
Correct Answer: B. Current owners whose properties front the roadway
Rationale: Infrastructure improvements such as sewer systems are commonly funded
through special assessments imposed on benefiting property owners. Since the owners
whose properties front the roadway directly benefit from the sewer installation, they
are generally responsible for contributing toward the cost. Tenants do not typically
pay special assessments, and the burden is not usually deferred to future buyers.
Question 4
State laws vary regarding whether a seller must disclose which of the following
circumstances to a buyer?
A. The property taxes for the previous year
B. A suicide that occurred in the home last year
C. Existing zoning classifications
D. The age of the roof
Correct Answer: B. A suicide that occurred in the home last year
Rationale: Events such as deaths, suicides, or alleged paranormal activity are
considered psychological stigmas rather than physical defects. Disclosure
requirements for these events differ among states. Physical conditions such as roof
age and zoning issues are material facts more commonly required to be disclosed
because they directly affect the property’s value or use.
Question 5
A property owner claims that government action has significantly reduced the value
or usability of the property without formally taking title. Which legal action may the
owner pursue?
,2026/2027
A. Partition suit
B. Inverse condemnation lawsuit
C. Quiet title action
D. Specific performance claim
Correct Answer: B. Inverse condemnation lawsuit
Rationale: Inverse condemnation occurs when government action effectively deprives
an owner of the beneficial use of property without formally exercising eminent
domain. The property owner may sue to recover compensation for the loss. Partition
suits involve co-owners, quiet title actions resolve ownership disputes, and specific
performance enforces contractual obligations.
Question 6
Under federal fair housing laws, racial discrimination in the rental of residential
property is permitted under which circumstances?
A. When the owner occupies the property
B. In owner-financed transactions only
C. Under no circumstances
D. When the tenant agrees in writing
Correct Answer: C. Under no circumstances
Rationale: Federal fair housing laws strictly prohibit racial discrimination in housing
transactions. Race is a protected class under the Civil Rights Act of 1866 and the Fair
Housing Act of 1968. Landlords, brokers, and property managers may not refuse to
rent, negotiate differently, or otherwise discriminate based on race.
Question 7
A real estate broker listing a residential property should personally verify which of the
following details to avoid potential liability?
A. The seller’s marital status
B. The estimated future market value
C. The number of square feet in the structure
D. The buyer’s mortgage qualification
Correct Answer: C. The number of square feet in the structure
Rationale: Square footage is considered a material fact that may influence a buyer’s
decision. Brokers should verify measurements rather than relying solely on the
seller’s statements to avoid negligent misrepresentation claims. Marital status and
buyer qualification are unrelated to property measurement responsibilities, and future
market value is speculative.
, 2026/2027
Question 8
Real property may legally become personal property through which process?
A. Accession
B. Annexation
C. Severance
D. Avulsion
Correct Answer: C. Severance
Rationale: Severance occurs when an item attached to real property is detached,
thereby converting it into personal property. Examples include cutting down trees or
removing built-in fixtures. Annexation is the opposite process, where personal
property becomes part of the real estate.
Question 9
Buyers submitted an offer on a property. The seller rejected the original offer and
issued a counteroffer. Before the counteroffer was accepted, the buyers made an offer
on another property, which was accepted. Later, the buyers accepted the original
seller’s counteroffer. Which statement is TRUE?
A. Only the first contract is enforceable
B. Only the second contract is enforceable
C. Both contracts are legally valid
D. Neither contract is enforceable without additional consideration
Correct Answer: C. Both contracts are legally valid
Rationale: Buyers may legally enter into multiple contracts simultaneously unless one
agreement specifically prohibits doing so. Once the buyers accepted the counteroffer
and it was communicated to the seller, a binding contract was formed. The existence
of another accepted contract does not automatically invalidate either agreement.
Question 10
In many western states where water is scarce, water rights are often governed by
which legal doctrine?
A. Littoral rights
B. Riparian rights
C. Prior appropriation
D. Accretion doctrine
Correct Answer: C. Prior appropriation
