PERRY REAL ESTATE COLLEGE FINAL EXAM 2026 QUESTIONS
AND CORRECT ANSWERS WITH DETAILED RATIONALES EACH |
CURRENTLY TESTING AND FREQUENTLY TESTED QUESTIONS| EXPERT
VERIFIED FOR GUARANTEED PASS | LATEST UPDATE
SECTION 1: PROPERTY OWNERSHIP (Questions 1–25)
Question 1
The "bundle of rights" in real property ownership includes the rights of
possession, control, exclusion, enjoyment, and:
A. Taxation
B. Disposition
C. Escheat
D. Eminent domain
Answer: B. Disposition
Rationale: Disposition is the right to sell, gift, lease, encumber, or will the
property. It is one of the five main rights in the bundle. Taxation, escheat,
eminent domain, and police power are the four government limitations on private
ownership, not rights held by the owner. Therefore, A, C, and D are incorrect
because they are government powers, not owner rights.
Question 2
Which of the following is considered real property?
A. A refrigerator delivered to the home last week
B. A built-in dishwasher permanently installed in the cabinetry
C. A stack of lumber in the garage
D. A tenant's display shelving bolted in for business use
Answer: B. A built-in dishwasher permanently installed in the cabinetry
Rationale: A fixture is personal property that has become real property through
attachment. The built-in dishwasher is annexed and adapted to the realty. Loose
appliances and unattached materials remain personalty (A and C). Trade fixtures
installed by a commercial tenant remain the tenant's personal property and are
removable before lease end (D).
Question 3
1
,The legal test most often applied to determine whether an item is a fixture
considers method of attachment, adaptation to the realty, relationship of the
parties, and:
A. The cost of the item
B. The intent of the person who installed it
C. The age of the building
D. Whether the item is insured
Answer: B. The intent of the person who installed it
Rationale: Intent is generally the controlling factor, with the other tests serving as
objective evidence of intent. Cost (A), age of building (C), and insurance (D) are
not legal tests for fixtures. Because the test is fact-specific, the practical solution
is to list questionable items expressly in the purchase agreement as included or
excluded.
Question 4
A fee simple absolute estate is best described as:
A. Ownership limited to the life of a named person
B. The highest and most complete form of ownership, of unlimited duration and
freely inheritable
C. Ownership that automatically reverts upon a stated event
D. A leasehold of indefinite length
Answer: B. The highest and most complete form of ownership, of unlimited
duration and freely inheritable
Rationale: Fee simple absolute carries the full bundle of rights, continues
indefinitely, and passes by will or descent. A is a life estate. C is a defeasible fee. D
is a leasehold, not a freehold estate. Therefore, B is the only correct description.
Question 5
A grantor conveys property "to Maria for life, then to Jordan." Jordan holds a:
A. Reversion
B. Remainder
C. Reverter
D. Leasehold
Answer: B. Remainder
2
,Rationale: When the future interest following a life estate is held by a third party,
it is a remainder. A reversion arises when the future interest stays with the
grantor (A). A reverter is associated with a fee simple determinable (C). A
leasehold is a tenant's interest (D).
Question 6
Which form of co-ownership includes the right of survivorship?
A. Tenancy in common
B. Joint tenancy
C. Tenancy by the entirety
D. Both B and C
Answer: D. Both B and C
Rationale: Joint tenancy and tenancy by the entirety both include the right of
survivorship, meaning that upon the death of one co-owner, their interest
automatically passes to the surviving co-owner(s) without probate. Tenancy in
common does not include survivorship (A). Tenancy by the entirety is a special
form of joint tenancy available only to married couples. Therefore, D is correct.
Question 7
A condominium owner owns:
A. A proprietary lease to a unit
B. Fee simple title to a unit plus an undivided interest in common elements
C. Shares of stock in a corporation
D. A life estate in a unit
Answer: B. Fee simple title to a unit plus an undivided interest in common
elements
Rationale: Condominium ownership combines fee simple ownership of the
individual unit with tenancy in common ownership of common areas. Cooperative
ownership involves shares of stock and a proprietary lease (A and C). A life estate
(D) is a different form of ownership.
Question 8
In a cooperative, the owner receives:
A. A deed to the unit
B. A proprietary lease
3
, C. A life estate
D. A remainder interest
Answer: B. A proprietary lease
Rationale: Cooperative shareholders receive a proprietary lease that gives them
the right to occupy a specific unit. They do not receive a deed (A); the corporation
holds title to the entire property. A life estate (C) and remainder interest (D) are
different estates.
Question 9
The right to encumber a property is part of which bundle of rights?
A. Control
B. Disposition
C. Exclusion
D. Enjoyment
Answer: B. Disposition
Rationale: The right to encumber (mortgage, lien, easement) is a disposition right
because it involves transferring or limiting an interest in the property. Control (A)
is the right to manage use. Exclusion (C) is the right to keep others out. Enjoyment
(D) is the right to use and benefit from the property.
Question 10
Which of the following is an example of special purpose real estate?
A. Single-family residence
B. Church
C. Apartment building
D. Retail shopping center
Answer: B. Church
Rationale: Special purpose real estate includes properties that have limited utility
to the general market, such as churches, schools, cemeteries, and government-
held lands. Single-family homes, apartments, and retail centers are more general-
purpose properties.
Question 11
A life estate is measured by:
4
AND CORRECT ANSWERS WITH DETAILED RATIONALES EACH |
CURRENTLY TESTING AND FREQUENTLY TESTED QUESTIONS| EXPERT
VERIFIED FOR GUARANTEED PASS | LATEST UPDATE
SECTION 1: PROPERTY OWNERSHIP (Questions 1–25)
Question 1
The "bundle of rights" in real property ownership includes the rights of
possession, control, exclusion, enjoyment, and:
A. Taxation
B. Disposition
C. Escheat
D. Eminent domain
Answer: B. Disposition
Rationale: Disposition is the right to sell, gift, lease, encumber, or will the
property. It is one of the five main rights in the bundle. Taxation, escheat,
eminent domain, and police power are the four government limitations on private
ownership, not rights held by the owner. Therefore, A, C, and D are incorrect
because they are government powers, not owner rights.
Question 2
Which of the following is considered real property?
A. A refrigerator delivered to the home last week
B. A built-in dishwasher permanently installed in the cabinetry
C. A stack of lumber in the garage
D. A tenant's display shelving bolted in for business use
Answer: B. A built-in dishwasher permanently installed in the cabinetry
Rationale: A fixture is personal property that has become real property through
attachment. The built-in dishwasher is annexed and adapted to the realty. Loose
appliances and unattached materials remain personalty (A and C). Trade fixtures
installed by a commercial tenant remain the tenant's personal property and are
removable before lease end (D).
Question 3
1
,The legal test most often applied to determine whether an item is a fixture
considers method of attachment, adaptation to the realty, relationship of the
parties, and:
A. The cost of the item
B. The intent of the person who installed it
C. The age of the building
D. Whether the item is insured
Answer: B. The intent of the person who installed it
Rationale: Intent is generally the controlling factor, with the other tests serving as
objective evidence of intent. Cost (A), age of building (C), and insurance (D) are
not legal tests for fixtures. Because the test is fact-specific, the practical solution
is to list questionable items expressly in the purchase agreement as included or
excluded.
Question 4
A fee simple absolute estate is best described as:
A. Ownership limited to the life of a named person
B. The highest and most complete form of ownership, of unlimited duration and
freely inheritable
C. Ownership that automatically reverts upon a stated event
D. A leasehold of indefinite length
Answer: B. The highest and most complete form of ownership, of unlimited
duration and freely inheritable
Rationale: Fee simple absolute carries the full bundle of rights, continues
indefinitely, and passes by will or descent. A is a life estate. C is a defeasible fee. D
is a leasehold, not a freehold estate. Therefore, B is the only correct description.
Question 5
A grantor conveys property "to Maria for life, then to Jordan." Jordan holds a:
A. Reversion
B. Remainder
C. Reverter
D. Leasehold
Answer: B. Remainder
2
,Rationale: When the future interest following a life estate is held by a third party,
it is a remainder. A reversion arises when the future interest stays with the
grantor (A). A reverter is associated with a fee simple determinable (C). A
leasehold is a tenant's interest (D).
Question 6
Which form of co-ownership includes the right of survivorship?
A. Tenancy in common
B. Joint tenancy
C. Tenancy by the entirety
D. Both B and C
Answer: D. Both B and C
Rationale: Joint tenancy and tenancy by the entirety both include the right of
survivorship, meaning that upon the death of one co-owner, their interest
automatically passes to the surviving co-owner(s) without probate. Tenancy in
common does not include survivorship (A). Tenancy by the entirety is a special
form of joint tenancy available only to married couples. Therefore, D is correct.
Question 7
A condominium owner owns:
A. A proprietary lease to a unit
B. Fee simple title to a unit plus an undivided interest in common elements
C. Shares of stock in a corporation
D. A life estate in a unit
Answer: B. Fee simple title to a unit plus an undivided interest in common
elements
Rationale: Condominium ownership combines fee simple ownership of the
individual unit with tenancy in common ownership of common areas. Cooperative
ownership involves shares of stock and a proprietary lease (A and C). A life estate
(D) is a different form of ownership.
Question 8
In a cooperative, the owner receives:
A. A deed to the unit
B. A proprietary lease
3
, C. A life estate
D. A remainder interest
Answer: B. A proprietary lease
Rationale: Cooperative shareholders receive a proprietary lease that gives them
the right to occupy a specific unit. They do not receive a deed (A); the corporation
holds title to the entire property. A life estate (C) and remainder interest (D) are
different estates.
Question 9
The right to encumber a property is part of which bundle of rights?
A. Control
B. Disposition
C. Exclusion
D. Enjoyment
Answer: B. Disposition
Rationale: The right to encumber (mortgage, lien, easement) is a disposition right
because it involves transferring or limiting an interest in the property. Control (A)
is the right to manage use. Exclusion (C) is the right to keep others out. Enjoyment
(D) is the right to use and benefit from the property.
Question 10
Which of the following is an example of special purpose real estate?
A. Single-family residence
B. Church
C. Apartment building
D. Retail shopping center
Answer: B. Church
Rationale: Special purpose real estate includes properties that have limited utility
to the general market, such as churches, schools, cemeteries, and government-
held lands. Single-family homes, apartments, and retail centers are more general-
purpose properties.
Question 11
A life estate is measured by:
4
