TEXAS REAL ESTATE BROKER LICENSING EXAMINATION NEWEST EVALUATED
EXAM PRACTICE 100 QUESTIONS 2026-2027|ORIGINAL QUESTIONS & ANSWERS
|DETAILED RATIONALES |HINTED COMPLETE EXAM PREP GRADED A+*INSTANT
DOWNLOAD PDF*
1. A seller grants a buyer an estate that automatically terminates when the
property is used for a prohibited purpose, with no further action required
by the grantor. What type of estate is this?
A. Fee simple absolute
B. Life estate
C. Fee simple determinable
D. Fee simple subject to condition subsequent
Answer: C. Fee simple determinable
Explanation: A fee simple determinable ends automatically upon the occurrence
of the stated event and is commonly created with words such as “so long as,”
“while,” or “until.”
2. A property owner grants a neighbor the right to cross the owner's land to
reach a public road. The neighbor does not own any land benefiting from
the right. What type of easement is most likely involved?
A. Appurtenant easement
B. Easement in gross
C. Easement by necessity
D. Easement by implication
Answer: B. Easement in gross
Explanation: An easement in gross benefits a person or entity rather than a
particular parcel of dominant land.
3. Which principle of value states that the maximum value of a property tends
to be established by the cost of acquiring an equally desirable substitute?
,A. Contribution
B. Conformity
C. Anticipation
D. Substitution
Answer: D. Substitution
Explanation: The principle of substitution holds that a rational buyer generally will
not pay more for a property than the cost of obtaining a comparable substitute.
4. A buyer submits an offer for $425,000. The seller changes the price to
$440,000 and signs the document. What has the seller created?
A. Acceptance
B. Executed contract
C. Counteroffer
D. Unilateral contract
Answer: C. Counteroffer
Explanation: A material change to the original offer rejects the original offer and
creates a new offer.
5. Which appraisal approach is generally most appropriate for a typical owner-
occupied single-family residence when sufficient comparable sales are
available?
A. Cost approach
B. Income approach
C. Sales comparison approach
D. Gross income multiplier approach
Answer: C. Sales comparison approach
Explanation: The sales comparison approach relies on recently sold properties
with similar characteristics and is commonly used for residential properties.
6. A buyer purchases a property for $600,000 and obtains a loan of $480,000.
What is the loan-to-value ratio?
,A. 75%
B. 80%
C. 85%
D. 80%
Answer: D. 80%
Explanation: LTV = loan amount ÷ property value. $480,000 ÷ $600,000 = 0.80, or
80%.
7. A property produces an NOI of $72,000 annually and has a market value of
$900,000. What is its capitalization rate?
A. 6%
B. 7%
C. 8%
D. 9%
Answer: C. 8%
Explanation: Capitalization rate = NOI ÷ value. $72,000 ÷ $900,000 = 0.08, or 8%.
8. Which situation best illustrates functional obsolescence?
A. A neighborhood experiences increased traffic
B. A roof deteriorates because of age
C. A house has an outdated floor plan that is undesirable to current buyers
D. A nearby factory creates unpleasant odors
Answer: C. A house has an outdated floor plan that is undesirable to current
buyers
Explanation: Functional obsolescence results from deficiencies in the property's
design, layout, or features relative to current standards.
9. Which type of contract requires only one party to make a promise while the
other party accepts by performing?
A. Bilateral contract
B. Express contract
, C. Executed contract
D. Unilateral contract
Answer: D. Unilateral contract
Explanation: A unilateral contract involves a promise exchanged for performance
rather than a promise exchanged for another promise.
10.A tenant remains in possession after the lease expires without the
landlord's consent. What type of tenancy may result?
A. Tenancy at will
B. Periodic tenancy
C. Estate for years
D. Tenancy at sufferance
Answer: D. Tenancy at sufferance
Explanation: A tenancy at sufferance occurs when a tenant remains in possession
without the landlord's consent after the lawful tenancy has ended.
11.Which governmental power permits the government to acquire privately
owned property for a public use upon payment of required compensation?
A. Police power
B. Taxation
C. Escheat
D. Eminent domain
Answer: D. Eminent domain
Explanation: Eminent domain is the government's power to take private property
for a public purpose, subject to constitutional requirements for compensation.
12.A broker's salesperson knowingly tells a buyer that a property has never
experienced flooding even though the salesperson knows it flooded the
previous year. Which conduct is most directly involved?
A. Puffing
B. Conversion
EXAM PRACTICE 100 QUESTIONS 2026-2027|ORIGINAL QUESTIONS & ANSWERS
|DETAILED RATIONALES |HINTED COMPLETE EXAM PREP GRADED A+*INSTANT
DOWNLOAD PDF*
1. A seller grants a buyer an estate that automatically terminates when the
property is used for a prohibited purpose, with no further action required
by the grantor. What type of estate is this?
A. Fee simple absolute
B. Life estate
C. Fee simple determinable
D. Fee simple subject to condition subsequent
Answer: C. Fee simple determinable
Explanation: A fee simple determinable ends automatically upon the occurrence
of the stated event and is commonly created with words such as “so long as,”
“while,” or “until.”
2. A property owner grants a neighbor the right to cross the owner's land to
reach a public road. The neighbor does not own any land benefiting from
the right. What type of easement is most likely involved?
A. Appurtenant easement
B. Easement in gross
C. Easement by necessity
D. Easement by implication
Answer: B. Easement in gross
Explanation: An easement in gross benefits a person or entity rather than a
particular parcel of dominant land.
3. Which principle of value states that the maximum value of a property tends
to be established by the cost of acquiring an equally desirable substitute?
,A. Contribution
B. Conformity
C. Anticipation
D. Substitution
Answer: D. Substitution
Explanation: The principle of substitution holds that a rational buyer generally will
not pay more for a property than the cost of obtaining a comparable substitute.
4. A buyer submits an offer for $425,000. The seller changes the price to
$440,000 and signs the document. What has the seller created?
A. Acceptance
B. Executed contract
C. Counteroffer
D. Unilateral contract
Answer: C. Counteroffer
Explanation: A material change to the original offer rejects the original offer and
creates a new offer.
5. Which appraisal approach is generally most appropriate for a typical owner-
occupied single-family residence when sufficient comparable sales are
available?
A. Cost approach
B. Income approach
C. Sales comparison approach
D. Gross income multiplier approach
Answer: C. Sales comparison approach
Explanation: The sales comparison approach relies on recently sold properties
with similar characteristics and is commonly used for residential properties.
6. A buyer purchases a property for $600,000 and obtains a loan of $480,000.
What is the loan-to-value ratio?
,A. 75%
B. 80%
C. 85%
D. 80%
Answer: D. 80%
Explanation: LTV = loan amount ÷ property value. $480,000 ÷ $600,000 = 0.80, or
80%.
7. A property produces an NOI of $72,000 annually and has a market value of
$900,000. What is its capitalization rate?
A. 6%
B. 7%
C. 8%
D. 9%
Answer: C. 8%
Explanation: Capitalization rate = NOI ÷ value. $72,000 ÷ $900,000 = 0.08, or 8%.
8. Which situation best illustrates functional obsolescence?
A. A neighborhood experiences increased traffic
B. A roof deteriorates because of age
C. A house has an outdated floor plan that is undesirable to current buyers
D. A nearby factory creates unpleasant odors
Answer: C. A house has an outdated floor plan that is undesirable to current
buyers
Explanation: Functional obsolescence results from deficiencies in the property's
design, layout, or features relative to current standards.
9. Which type of contract requires only one party to make a promise while the
other party accepts by performing?
A. Bilateral contract
B. Express contract
, C. Executed contract
D. Unilateral contract
Answer: D. Unilateral contract
Explanation: A unilateral contract involves a promise exchanged for performance
rather than a promise exchanged for another promise.
10.A tenant remains in possession after the lease expires without the
landlord's consent. What type of tenancy may result?
A. Tenancy at will
B. Periodic tenancy
C. Estate for years
D. Tenancy at sufferance
Answer: D. Tenancy at sufferance
Explanation: A tenancy at sufferance occurs when a tenant remains in possession
without the landlord's consent after the lawful tenancy has ended.
11.Which governmental power permits the government to acquire privately
owned property for a public use upon payment of required compensation?
A. Police power
B. Taxation
C. Escheat
D. Eminent domain
Answer: D. Eminent domain
Explanation: Eminent domain is the government's power to take private property
for a public purpose, subject to constitutional requirements for compensation.
12.A broker's salesperson knowingly tells a buyer that a property has never
experienced flooding even though the salesperson knows it flooded the
previous year. Which conduct is most directly involved?
A. Puffing
B. Conversion
