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Property Management TEST QUESTIONS
EXAM 2025 AND PRACTICE QUESTIONS
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Which of the following tenancies does not involve a lessor-lessee relationship? a. tenancy at will b. tenancy in common c. tenancy from month-to-month d. tenancy from year-to-year
- Ans - b. tenancy in common A lease would be terminated by which of the following? a. sale of a leased premises b. death of the tenant c. abandonment of leased premises by tenant d. expiration of term in a lease of years - Ans - b. death of the tenant The authority to carry out the eviction of a delinquent tenant from rented property comes from a. court b. landlord c. sheriff d. property owner
- Ans - a. court A lessee who pays some or all of the lessors property expenses has a a. gross lease b. net lease c. percentage lease d. sublease - Ans - b. net lease The principal difference between an estate for years and an estate from year to year is that a. an estate for years is a life estate b. an estate for years cannot be terminated c. an estate from year to year must be in writing d. an estate from year to year has no expiration date - Ans - d. an estate from year to year has no expiration date The owner of real estate who leases it to another is called a. vendor b. lessor c. grantor d. trustor - Ans - b. lessor How must a landlord hand the security deposit? a. it can only be collected on a residential unit b. landlord must pay tenant interest on the security deposit c. at the end of the lease, the landlord cannot apply security to rent owed by the tenant
A couple has signed a lease containing a provision to waive the rights to interest earned from the security deposit. This provision is a. unenforceable, thus making the lease invalid b. unenforceable, but the lease is still valid c. enforceable, because the couple agreed to the provision d. enforceable only up to a security deposit of $
- Ans - c. enforceable, because the couple agreed to the provision One of the principals to a property management agreement is the Property Manager-in-charge. What type if agent is the Property Manager-in-charge? a. general agent b. special agent c. universal agent d. routine agent - Ans - b. special agent Which of the following is not an essential element of a property management agreement? a. expiration date b. tenant income requirements c. identification of the parties d. owner responsibilities - Ans - b. tenant income requirements The first step for a property manager is to a. identify owners objectives b. identify tenant requirements c. negotiate the commission d. have the property appraised
- Ans - a. identify owners objectives When conducting a property analysis, which of the following is NOT typically a consideration in determining the rental price? a. operating costs b. equipment c. competition d. shopping - Ans - d. shopping Many property managers may choose to establish a reserve fund for each property. A reasonable percentage to put in the reserve fund for unforeseen issues would be a. 5- 10% b. 10 - 15% c. 15 - 25% d. 25 - 30% - Ans - b. 10-15% Cash required over a given period for the payment of principal and interest on a debt, such as mortgage payment on a property is considered a. debt service b. credit service c. savings service d. money management service - Ans - a. debt service Property managers can determine a more realistic picture of a property's income potential by forecasting the income and expenses for how many years out? a. 3
The on-site property manager from Acme Apartments is responsible for negotiating leases for the apartments. In this position, the on-site manager a. is exempt from licensing requirements b. must have a brokers license c. must have a real estate or property managers license d. may negotiate but may not sign leases without a license
- Ans - c. must have a real estate or property managers license The heater in the water tank of a rental property is broken and the landlord has indicated the heater will be repaired in a month or so, The SC Residential Landlord and Tenant Act requires a. the tenant move promptly b. the tenant make the repairs c. the landlord make the repairs as soon as possible d. the landlord provide cold, not hot water - Ans - c. the landlord make the repairs as soon as possible the SC Residential Landlord and Tenant Act applies to a. property management licensees, not real estate licensees b. managers of townhouses c. office leasing agents d. licensees who manage property, not owners who manage property - Ans - b. managers of townhouses In SC, if a landlord wants to terminate a month-to-month tenancy, how much notice must the tenant receive? a. 7 days b. 30 days c. 60 days
d. no notice
- Ans - b. 30 days Which of the following statements is TRUE? a. all leases must be in writing, regardless of term b. 15 month oral lease is enforceable c. a lease of less than 6 months would have to be in writing d. an 11 month oral lease is enforceable - Ans - d. an 11 month oral lease is enforceable In SC, the landlord may terminate the rental agreement if a tenant fails to pay rent within how many days of the scheduled due date? a. 5 days b. 7 days c. 10 days d. 30 days - Ans - a. 5 days Security deposits must be returned to the tenant within a. 14 days b. 15 days c. 30 days d. 45 days - Ans - c. 30 days What obligation does the smoke detector law impose on a landlord in a duplex? a. none, only single-family rentals are impacted by smoke detector regulations
Fair housing and anti-discrimination laws prevent property managers from discriminating against prospective tenants based on: - Ans - all of the choices apply. The __________ Act regulates the relationship between residential property owners/managers and their tenants. The Act has a variety of provisions such as, handling and returning security deposits, owners/managers right to re-enter the property, and retaliation provisions. - Ans - Uniform Residential Landlord and Tenant Unlike with residential rentals, lease agreements for __________ typically contain a "Compliance with Laws" clause that requires the tenant to be responsible for noncompliance that results from the tenant's use of or alterations to the property. - Ans - commercial rentals What organization issues the Certified Property Manager (CPM) certification? - Ans - Institute of Real Estate Management All of the following are duties of on-site managers, except: - Ans - suggesting alternative property uses to increase income, such as converting apartments to condominiums. Measuring standards developed by the __________ provide guidance for measuring the floor areas of office buildings, retail space, warehouses, and other types of properties. - Ans - Building Owners and Managers Association International (BOMA) A property management company will choose the types of marketing and maintenance issuers that: - Ans - are beneficial to the property type chosen. Which of the following describes the acronym FBN? - Ans - Fictitious Business Name All of the following are examples of tangible personal property used in business, except: - Ans - patents What is an account managed by one party for the benefit of another in a banking institution authorized to do business in the state? - Ans - A trust account
When federal and state standards conflict, which one will typically apply to laws dealing with employment issues? - Ans - The rules that provide the most protection for employees. What contains all the policies, procedures and work instructions that make up the way a company carries out all the functions of its business? - Ans - A policy and procedure manual or employee handbook What is the amount of money necessary to carry out daily activities? - Ans - Working capital A property manager should have electronic files:The specialization of serving the needs of clients in a particular geographical area is known as: - Ans - backed up, with the back-up files stored off-site. The specialization of serving the needs of clients in a particular geographical area is known as: - Ans - geographic segmentation. Which of the following statements is not true regarding fees charged by a property management company? - Ans - A management company usually charges a flat fee to manage rental property. What do the courts use to decide whether an agent has used reasonable skill and care in a disputed transaction? - Ans - A standard of care Which of the following will have a direct effect on an investor's yield expectations? - Ans - His or her risk tolerance All of the following are typical goals most real estate investors have, except: - Ans - dividend yields.
The contraction phase of a business cycle, is marked by all of the following, except: - Ans - economic activity drops. When real estate supply growth begins to exceed demand growth, the market is reaching: - Ans
- the peak Which of the following does not occur during the contraction phase in a real estate cycle? - Ans - High market liquidity For investment property, the _____________ is the rate at which a type of property is leased by the market. - Ans - absorption rate Donna, an experienced property manager, is conducting a neighborhood analysis for a property. Which of the following is not a physical issue that Donna would consider in the analysis? - Ans - Per capita income Which of the following steps is vital for Gayle, a new property manager, during the preparation of her first market rental survey? - Ans - She should adjust rental rates based on the differences of the features and amenities in the comparables. What is a vital step during the preparation of a market rental survey? - Ans - Adjust rental rates based on the differences of the features and amenities The principle of competition in terms of property management states rental rates are affected by: - Ans - supply and demand. What should Donna do before developing a rental survey and creating a management plan for a newly acquired property? - Ans - Make a thorough walk through of the exterior and interior of the property
__________ rent is what a leased property would expect to rent for under current market conditions if the property were vacant and available for rent at current rental rates. - Ans - Market The property owner sets funds aside to pay for certain fixtures and building components that periodically wear out. These funds are known as: - Ans - replacement reserves. Alex needs to prepare a property management plan, but is unsure of which elements usually are included. Of the four choices listed, which element would Alex NOT include? - Ans - Hiring recommendations A(n) __________ budget is an itemized list of all estimated income and expenses for a specified time. - Ans - operating If tenants are delinquent in paying their agreed-upon rents, it creates: - Ans - a collection loss. The management plan should be all of the following, except: - Ans - inaccurate All of the following are operating reports, except: - Ans - statement of cash flow. Of the various financial statements and operational reports prepared monthly for a property, which one provides a list of units that are unoccupied and available for lease? - Ans - Vacancy Report What is usually the largest single fixed expense of a property? - Ans - Property tax The demographics of an area help determine a target market. A target is a(n): - Ans - identifiable group of people who are most likely to seek the services or buy the products of a business. SWOT stands for: - Ans - Strengths & Weaknesses / Opportunities & Threats.
A tenant who occupies a property after the expiration of a lease is called a: - Ans - holdover tenant. What type of leasehold estate occurs when a tenant occupies the property after the expiration of a lease? - Ans - Tenancy at sufferance Which of the following statements is incorrect regarding lease formats? - Ans - Typically, commercial leases tend to use standardized forms. What type of lease often is used for banks, restaurants, or other commercial uses in which the tenant builds and maintains the building? - Ans - Ground lease A __________ fee is a fee that will not be returned to the tenant under any circumstance, and this fee cannot legally be called a deposit. - Ans - non-refundable Aside from the standard lease clauses, residential leases have additional clauses. Which of the following clauses would not be found in a residential lease? - Ans - Exclusivity clause Which of the following relates to a person's character and is associated with a person's credit history? - Ans - Willingness to pay An individual with a FICO score of 800 is considered: - Ans - low risk Rent concessions are sometimes necessary to attract tenants. Which of the following typically is not considered a rent concession? - Ans - Increased rent The amount of free rent offered depends on all of the following, except: - Ans - character of the property owner. Tenants need to be able to reach management personnel in all of the following ways, except: - Ans - by twitter.
What form describing the condition of the rooms, fixtures, and appliances should be given to a tenant to complete before moving into a unit? - Ans - Move-in checklist Which of the following statements regarding commercial rules and regulations of moving into or out of the property is true? - Ans - All of the choices apply For paying rent, __________ may be tenant-generated using online banking or pre-authorized for payment on the due date each month. - Ans - electronic payments During an inflationary real estate cycle the: - Ans - owner would like a short-term lease. A lease renewal negotiation will focus on all of the following factors, except: - Ans - the location of the property management office. Which of the following is an example of damage to a property? - Ans - wood floors badly scratched or gouged Reasons for tenant eviction include all of the following, except: - Ans - compliance with health and safety codes. During __________, legal briefs are usually prepared, documents and other physical evidence are provided, and testimony is often given under oath - Ans - arbitration If the result of arbitration is __________, the parties must abide by the decision of the arbitrator and may not request a trial. - Ans - binding For residential property, a property manager will primarily focus his/her maintenance responsibility on the: - Ans - common areas of the property.
The strategies a property manager can implement to remove or minimize risks on the property do not include: - Ans - renting risk. The __________ is the amount the insured must pay when any insurance claim is filed. - Ans - deductible A(n) __________ clause states that if a claim is entered against a tenant for damage caused to a third party, the tenant will be fully financially responsible. - Ans - indemnity Which type of insurance policy covers the amount of loss above the limits of a basic liability policy? - Ans - Umbrella policy Casualty insurance provides coverage primarily for the liability exposure of an individual, business, or organization. What type of casualty insurance covers liability for accidental injury or property damage from either a condition on the premises or operations in progress? - Ans - Premises Lead and lead compounds have been used in a wide variety of consumer products found in and around our homes, including: - Ans - all of the choices apply. Paint, pipes and batteries Which federal law passed in 1970 requires the EPA to establish national standards for clean air?
- Ans - Clean Air Act (CAA) Facilities governed by the RCRA that treat, store, and dispose of hazardous and toxic substances are called: - Ans - TSD sites. One critical standard implemented by the RCRA requires TSDs to: - Ans - take corrective action immediately after any improper release of toxic chemicals.
All of the following are specific to a security officer's tasks, except: - Ans - providing budget reports to property manager. Which of the following is a type of modern security technology? - Ans - All of the choices apply All employee computers must be assigned passwords. Which of the following is a qualification of a password that is difficult to decode? - Ans - All of the choices apply As a property manager, it is important to know the city's fire and building codes. Property managers can help keep tenants safe by using a fire and safety inspection checklist. Which item would probably not be included in the checklist? - Ans - Flammable materials should be stored near heaters A good building automation system (BAS) not only provides energy management and helps reduce operating costs, it also adds automated control and management during emergencies to other building operations, such as: - Ans - All of the choices apply During a fire, which does not accumulate in an elevator shaft? - Ans - Cool air The courts are beginning to hold property managers and owners responsible for criminal acts committed on private property. As a property manager, you have decided to establish several preventive security measures against drug activity on the property. Which of the listed methods applies towards preventing drug activity on a property? - Ans - Repair broken doors, fences, and windows promptly. Guests of tenants can create problems. What are some steps a property manager can take to reduce incidents of crime committed by visitors? - Ans - Use an intercom system and instruct tenants only to buzz in people they know personally and require all tenants' to sign an agreement regarding acceptable behavior on the property Securing building keys is extremely important. A property manager would do all of the following activities to secure the keys, except: - Ans - leave key boxes open and unattended.
