DRE EXAM QUESTIONS WITH CORRECT
ANSWERS 2026-2027
The buyer in a sale leaseback transaction would be least concerned with the: -
CORRECT ANSWER -Original cost to construct the building.
A real estate broker is guilty of conversion if they: - CORRECT ANSWER -
Used trust funds for their personal use. (Conversion requires the personal use of client monies.
)
The referral of a client to a financially controlled business owned by the broker is required to b
e disclosed by use of a(n): - CORRECT ANSWER -
Affiliated Business Arrangement Disclosure Statement (Not conflict of interest because broker d
oes not have a personal interest or professional bias that interferes with fiduciary duty; like rel
ative of someone in transaction or has ownership interest in a property.)
A listing broker needs to present all offers received on a listing property until: -
CORRECT ANSWER -Escrow is closed.
A prohibition against a "For Sale" sign in a residential neighborhood: - CORRECT ANSWER -
Violates the First Amendment (freedom of speech and free flow of truthful commercial inform
ation)
Which of the following entity does not buy loans in the secondary mortgage market? -
CORRECT ANSWER -Federal Housing Administration (FHA)
Recording a deed provides: - CORRECT ANSWER -
Constructive Notice (of the ownership of a property)
,When a lease is for a period greater than one year, the contract does not require: -
CORRECT ANSWER -
Signatures of both the owner and tenant (only requires signature of tenant)
If a deed provides for an easement granting ingress and egress over a neighboring property but
fails to locate the easement, the: - CORRECT ANSWER -
Servient tenement holder can specify if a particular area so long as it is responsible.
Ana sold her primary residence for $950k. She originally paid $750k for the property 4 years ag
o. She spent $300k on capital improvements during her ownership. What can Ana write-
off when filing her tax return? - CORRECT ANSWER -
Nothing (Capital losses are not permitted on a primary residence)
When a dual agency is establish in a 1-to-
4 unit residential sales transaction, the broker and their agents may pass on information relatin
g to the from one party to another. - CORRECT ANSWER -
Price of comparable homes in the neighborhood (comps are okay, financial info can not be shar
ed)
To depreciate real estate, it needs to be: - CORRECT ANSWER -Improved
The primary purpose of any deed is to: - CORRECT ANSWER -
Give evidence of the change in title or transfer of an interest in real property.
Under the Real Estate Law, a real estate salesperson is: - CORRECT ANSWER -
An employee of the broker.
When an administrator of an estate sells a parcel: - CORRECT ANSWER -
Court approval is required. (A sale from an estate involves a court)
, The annual percentage yield (APY) applies to: - CORRECT ANSWER -Savings accounts
On January 1, 1987, which real estate disclosure law went into effect? - CORRECT ANSWER -
The Transfer Disclosure Statement (TDS)
Housing expenses are one of the largest denominators in the Consumer Price Index (CPI) since:
- CORRECT ANSWER -Housing is one of the largest expenses for consumers.
What is one board foot? - CORRECT ANSWER -12in x 12 in x 1in (6"x2"x12")
Which zoning designation is suitable for land used as the site of multi-
family residential developments? - CORRECT ANSWER -R-
4 (Residential zoning is labeled with R. Multiple units with have the number of units other than
1)
Randy bought a 12-
unit apartment building. What is the minimum number of years in which he may depreciate th
e building for federal income tax purposes? - CORRECT ANSWER -
27.5 (the depreciation minimum is 27.5 years regardless of units or property usage, as long as i
t is held as rental or investment property)
To be enforceable, the listing of a business opportunity: - CORRECT ANSWER -
Does not always have to be in writing.
Under a , the agent's fee is set as all sums received exceeding a net price established by t
he owner. - CORRECT ANSWER -
Net listing (gives an established amount to the seller and all the excess to the broker).
In which year did the US Supreme Court prohibir all racial discrimination in the sale or lease of
real property? - CORRECT ANSWER -1968. (Civil Rights Act as a federal law)
ANSWERS 2026-2027
The buyer in a sale leaseback transaction would be least concerned with the: -
CORRECT ANSWER -Original cost to construct the building.
A real estate broker is guilty of conversion if they: - CORRECT ANSWER -
Used trust funds for their personal use. (Conversion requires the personal use of client monies.
)
The referral of a client to a financially controlled business owned by the broker is required to b
e disclosed by use of a(n): - CORRECT ANSWER -
Affiliated Business Arrangement Disclosure Statement (Not conflict of interest because broker d
oes not have a personal interest or professional bias that interferes with fiduciary duty; like rel
ative of someone in transaction or has ownership interest in a property.)
A listing broker needs to present all offers received on a listing property until: -
CORRECT ANSWER -Escrow is closed.
A prohibition against a "For Sale" sign in a residential neighborhood: - CORRECT ANSWER -
Violates the First Amendment (freedom of speech and free flow of truthful commercial inform
ation)
Which of the following entity does not buy loans in the secondary mortgage market? -
CORRECT ANSWER -Federal Housing Administration (FHA)
Recording a deed provides: - CORRECT ANSWER -
Constructive Notice (of the ownership of a property)
,When a lease is for a period greater than one year, the contract does not require: -
CORRECT ANSWER -
Signatures of both the owner and tenant (only requires signature of tenant)
If a deed provides for an easement granting ingress and egress over a neighboring property but
fails to locate the easement, the: - CORRECT ANSWER -
Servient tenement holder can specify if a particular area so long as it is responsible.
Ana sold her primary residence for $950k. She originally paid $750k for the property 4 years ag
o. She spent $300k on capital improvements during her ownership. What can Ana write-
off when filing her tax return? - CORRECT ANSWER -
Nothing (Capital losses are not permitted on a primary residence)
When a dual agency is establish in a 1-to-
4 unit residential sales transaction, the broker and their agents may pass on information relatin
g to the from one party to another. - CORRECT ANSWER -
Price of comparable homes in the neighborhood (comps are okay, financial info can not be shar
ed)
To depreciate real estate, it needs to be: - CORRECT ANSWER -Improved
The primary purpose of any deed is to: - CORRECT ANSWER -
Give evidence of the change in title or transfer of an interest in real property.
Under the Real Estate Law, a real estate salesperson is: - CORRECT ANSWER -
An employee of the broker.
When an administrator of an estate sells a parcel: - CORRECT ANSWER -
Court approval is required. (A sale from an estate involves a court)
, The annual percentage yield (APY) applies to: - CORRECT ANSWER -Savings accounts
On January 1, 1987, which real estate disclosure law went into effect? - CORRECT ANSWER -
The Transfer Disclosure Statement (TDS)
Housing expenses are one of the largest denominators in the Consumer Price Index (CPI) since:
- CORRECT ANSWER -Housing is one of the largest expenses for consumers.
What is one board foot? - CORRECT ANSWER -12in x 12 in x 1in (6"x2"x12")
Which zoning designation is suitable for land used as the site of multi-
family residential developments? - CORRECT ANSWER -R-
4 (Residential zoning is labeled with R. Multiple units with have the number of units other than
1)
Randy bought a 12-
unit apartment building. What is the minimum number of years in which he may depreciate th
e building for federal income tax purposes? - CORRECT ANSWER -
27.5 (the depreciation minimum is 27.5 years regardless of units or property usage, as long as i
t is held as rental or investment property)
To be enforceable, the listing of a business opportunity: - CORRECT ANSWER -
Does not always have to be in writing.
Under a , the agent's fee is set as all sums received exceeding a net price established by t
he owner. - CORRECT ANSWER -
Net listing (gives an established amount to the seller and all the excess to the broker).
In which year did the US Supreme Court prohibir all racial discrimination in the sale or lease of
real property? - CORRECT ANSWER -1968. (Civil Rights Act as a federal law)
