2.0 Real Property Ownership and Interest Real Estate License Practice Quiz

• A. a fixed rental period with no ownership rights
• B. the right to use the property only for a specific government-approved purpose
• C. an ownership interest of indefinite or potentially perpetual duration
• D. temporary possession that terminates automatically at the holder's death

A freehold estate is an ownership interest whose duration is either perpetual (fee simple) or measured by a life, both of which are indefinite as opposed to a fixed term.

• A. permanent ownership of the real property
• B. the right to possess and use the property for a defined period
• C. an equity interest that grows as rent is paid over time
• D. the ability to encumber the property with a mortgage lien

A leasehold gives the tenant the right of possession and use for a period set by the lease, without conveying ownership.

• A. a fee simple absolute
• B. a fee simple defeasible
• C. a life estate measured by the grantee's life
• D. an estate for years

A fee simple defeasible (or fee simple determinable) is a freehold ownership subject to a condition whose violation causes the estate to end and revert to the grantor.

• A. paying most or all of the operating expenses of the property
• B. sharing net income from the property with the tenant each month
• C. reimbursing the tenant for all utility costs at year-end
• D. contributing to a shared reserve account for tenant improvements

In a gross lease, the landlord bears most operating expenses, taxes, insurance, maintenance, out of the fixed rent received.

• A. unlimited personal liability for all business debts and obligations
• B. mandatory double taxation on profits distributed from the business
• C. a requirement to register annually with the state corporation commission
• D. a prohibition on entering into contracts with other businesses or individuals

A sole proprietor's personal assets are at risk because there is no legal separation between the owner and the business entity.

• A. automatically inherit the deceased co-owner's share by right of survivorship
• B. exclude other co-owners from using any portion of the common property
• C. collect a disproportionately larger share of rental income than their ownership percentage
• D. convey their individual ownership share to a third party without the other co-owners' consent

A tenant in common may freely sell, mortgage, or devise their undivided share without the other co-owners' approval.

• A. title to the land beneath the entire building structure
• B. ownership of the entire building in which the unit is located
• C. fee simple title to the unit's interior airspace and an undivided interest in common elements
• D. a proprietary lease rather than any form of fee simple ownership

A condominium owner has fee simple title to the interior airspace of the unit and a proportional undivided interest in common areas such as hallways, grounds, and roof.

• A. time, title, interest, and possession
• B. possession, use, income, and management control
• C. value, duration, alienability, and purpose
• D. title, occupancy, equity interest, and transferability

The four unities of joint tenancy are time (acquired simultaneously), title (same instrument), interest (equal shares), and possession (right to possess the whole).