with Answers & Detailed Rationales, National Real Estate
Principles, Property Ownership, Agency, Contracts, Financing,
Valuation, Texas Real Estate Law, TRELA & TREC Regulations
NATIONAL PORTION CONTENT AREAS
I. Real Property Characteristics, Legal Descriptions, and Property Use
Question 1
A property owner conveys a parcel of land "to my daughter Sarah for life, then to my
grandson Michael." Sarah has a life estate. What type of estate does Michael hold while
Sarah is alive?
A. Fee simple absolute
B. Remainder interest
C. Reversionary interest
D. Leasehold estate
Correct Answer: B
Explanation: A remainder interest is a future estate held by a third party (Michael) that
becomes possessory upon the natural termination of a prior life estate. The grantor retains
no reversion because the remainder is vested in Michael.
Question 2
Which of the following is considered a fixture and therefore part of the real property?
A. A portable space heater
B. A ceiling fan hardwired into the home
,C. Area rugs covering the living room floor
D. A freestanding bookshelf
Correct Answer: B
Explanation: A ceiling fan hardwired into the electrical system is attached by permanent
means and adapted to the property's use, making it a fixture. Portable items and
freestanding furniture remain personal property.
Question 3
A Texas rancher owns 200 acres of rural land and wishes to claim it as a family homestead.
Under Texas law, what is the maximum rural homestead exemption for a family?
A. 100 acres
B. 200 acres
C. 10 acres
D. 50 acres
Correct Answer: B
Explanation: Texas homestead law allows a family to exempt up to 200 acres of rural land,
while a single adult may exempt up to 100 rural acres. Urban homesteads are limited to 10
acres regardless of family status.
Question 4
A developer purchases a parcel described as "the NW 1/4 of the SE 1/4 of Section 12,
Township 3 North, Range 5 East." How many acres does this parcel contain?
A. 40 acres
B. 80 acres
,C. 160 acres
D. 20 acres
Correct Answer: A
Explanation: A section contains 640 acres. The SE 1/4 contains 160 acres, and the NW 1/4 of
that quarter contains 40 acres. Each quartering divides the area by four.
Question 5
A property owner grants a neighbor the right to cross her land to reach a public road. The
owner retains full ownership and possession of the land. What interest has been created?
A. Fee simple determinable
B. Easement appurtenant
C. Life estate
D. Fee simple subject to condition subsequent
Correct Answer: B
Explanation: An easement is a nonpossessory interest granting a right of use over another's
land without ownership transfer. An easement appurtenant benefits an adjacent parcel and
runs with the land.
Question 6
Which government power allows a municipality to regulate the use of private property
through zoning ordinances?
A. Eminent domain
B. Police power
, C. Escheat
D. Taxation
Correct Answer: B
Explanation: Police power is the constitutional authority of states and local governments to
regulate private property for public health, safety, and welfare. Zoning is a primary exercise
of this power.
Question 7
A landowner dies without a will and with no known heirs. Under the principle of escheat,
what happens to the property?
A. It is sold at public auction.
B. It transfers to the state government.
C. It becomes a public park.
D. It is divided among neighbors.
Correct Answer: B
Explanation: Escheat is the reversion of property to the state when an owner dies intestate
with no legal heirs. This prevents property from remaining ownerless and ensures continued
tax revenue.
Question 8
An appraiser uses a metes and bounds description for a rural property. Which of the
following would most likely be used as a monument in this description?
A. A GPS coordinate
B. A street address