BC Real Estate Exam Sample Questions (With Answers and Explanations)

How to use these

Twelve questions, one per major area, written in the style of the real exam: a short scenario, four options, one correct answer. Cover the explanations, answer all twelve on paper, then read the reasoning. A wrong answer is more useful than a right one here, because it tells you which chapter to open next.

One honest note first. These are original questions. They are not, and no prep resource's questions are, the actual exam questions. The exam authority does not release them. What a good sample question does is train the skill the exam tests: reading a fact pattern and picking the option that follows the rule. Our post on what is on the BC real estate exam explains the areas these questions come from.

1. Agency

A licensee at a Kelowna brokerage has been working with a buyer under a written representation agreement. The buyer wants to make an offer on a home that is listed by the same licensee. The property is in a busy urban area. Which statement is correct?

• A. The licensee may act for both parties as long as both sign a dual agency agreement.
• B. The licensee may act for both parties because they work for the same brokerage.
• C. The licensee cannot represent both the buyer and the seller in this transaction, and one of them will need to be represented by someone else or proceed unrepresented.
• D. The licensee may represent both parties if the managing broker approves.

Answer: C. Since June 2018, dual agency (one licensee representing both the buyer and the seller in the same trade) is generally prohibited in BC. The only exception is a narrow one for remote locations where no other licensee is reasonably available, which a busy urban area is not. Options A, B and D describe the pre-2018 world. This is one of the most heavily tested rule changes in the course.

2. Contracts

A buyer's accepted offer includes a subject-to-financing clause with a subject removal date of Friday. On Friday afternoon the buyer's lender approves the mortgage, but the buyer forgets to sign and deliver the subject removal form. What is the position on Saturday morning?

• A. The contract is binding because the financing was approved before the deadline.
• B. The contract is at an end because the subject was not removed in writing by the deadline.
• C. The seller must give the buyer a 24-hour extension before the contract can end.
• D. The subject is automatically waived because the buyer did not object.

Answer: B. A subject clause is a true condition precedent for the benefit of the party it protects, here the buyer. It has to be removed in writing by the stated deadline. Financing approval is what makes removal possible; it is not the removal. Without written removal, the contract terminates and both parties are released. There is no automatic extension and no automatic waiver.

3. Interests in land

Two sisters buy a townhouse together as joint tenants. One sister dies. What happens to her interest?

• A. It passes under her will to whoever she named.
• B. It passes to her estate and is distributed on intestacy if there is no will.
• C. It passes automatically to the surviving sister by right of survivorship.
• D. It is held in trust for her children until they turn 19.

Answer: C. The defining feature of a joint tenancy is the right of survivorship: on the death of one joint tenant, the survivor takes the whole interest automatically, outside the will and outside the estate. Had the sisters held as tenants in common, option B would be correct, because a tenant in common's share does pass through their estate. Being able to tell these two apart in a scenario is a reliable exam mark.

4. Title registration

A buyer purchases a property and is registered on title as the fee simple owner. Two years later a stranger produces an old, unregistered deed and claims to be the true owner. Under BC's Torrens-based land title system, which statement is correct?

• A. The stranger's earlier deed wins because it is older.
• B. The registered owner's title is conclusive evidence of ownership, subject to the specific exceptions set out in the Land Title Act, and an unregistered earlier deed is not one of them.
• C. The two claims are equal and a court will split the property.
• D. The buyer loses the property but is compensated from the assurance fund.

Answer: B. The principle is indefeasibility: registration is what creates and proves ownership, and the register is conclusive. The system does list exceptions (fraud in which the registered owner participated is the important one), but an unregistered prior deed is exactly the kind of claim the system was designed to defeat. Option D confuses the assurance fund, which compensates people deprived of an interest through the operation of the system, with the general rule.

5. Strata

A buyer is considering a strata lot and asks the licensee what a Form B Information Certificate will tell them. Which item is NOT something the buyer should expect to find on the Form B?

• A. The monthly strata fee for the lot.
• B. The current balance of the contingency reserve fund.
• C. Any special levies that have been approved but not yet paid.
• D. The market value of comparable strata lots in the building.

Answer: D. The Form B is the strata corporation's own disclosure about the lot and the corporation: fees, the contingency reserve fund, approved special levies, bylaw amendments not yet filed, court proceedings, and similar items. It says nothing about market value, which is the licensee's and the appraiser's job. Strata questions on the exam tend to be practical like this one: what document answers what question.

6. Professional conduct

When must a licensee provide a person with the Disclosure of Representation in Trading Services form?

• A. Only when the person signs a written representation agreement.
• B. Before providing trading services to the person, so they understand whether the licensee represents them before they share anything confidential.
• C. At the time an offer is presented.
• D. Only if the person asks whether the licensee represents them.

Answer: B. The whole point of the disclosure is timing: a person needs to know whether the licensee is acting for them before the conversation goes anywhere that matters. Waiting for a signed agreement, an offer, or a question from the consumer defeats that purpose. Regulator disclosure rules are tested as "when" questions far more often than "what" questions.

7. Mortgage math

A borrower takes a $400,000 mortgage at a rate of 5% per annum, compounded semi-annually, amortized over 25 years with monthly payments. Rounded to the nearest cent, the monthly payment is closest to:

• A. $2,326.42
• B. $2,338.36
• C. $2,000.00
• D. $2,451.07

Answer: A. The Canadian wrinkle is the compounding: the rate is quoted with semi-annual compounding but payments are monthly, so the first job is converting 5% compounded semi-annually into its equivalent monthly rate. On the HP 10bII+: set P/YR to 2, enter 5 as the nominal rate and find the effective rate, then set P/YR to 12 and convert back to a nominal rate compounded monthly. Then N = 300, PV = 400,000, FV = 0, solve for PMT. Option B is what you get if you skip the conversion and use 5% divided by 12 directly, which is the single most common error on the exam. Our mortgage math guide walks the keystrokes.

8. Interest rate conversion

A rate of 6% per annum compounded semi-annually is equivalent to what nominal rate compounded monthly, to three decimal places?

• A. 6.000%
• B. 6.090%
• C. 5.926%
• D. 5.877%

Answer: C. More frequent compounding at the same nominal rate produces more interest, so to stay equivalent the monthly-compounded nominal rate must be lower than 6%. That eliminates A and B on logic alone before you touch the calculator. The arithmetic: the semi-annual periodic rate is 3%, the equivalent monthly periodic rate is the sixth root of 1.03 minus 1, and multiplying that by 12 gives 5.926%. The interest rate conversion post drills this.

9. Appraisal

An appraiser using the direct comparison approach finds a comparable sale that is identical to the subject property except that the comparable has a double garage and the subject has a single garage. How should the adjustment be made?

• A. Add the value of the extra garage bay to the subject property's estimated value.
• B. Subtract the value of the extra garage bay from the comparable's sale price.
• C. Add the value of the extra garage bay to the comparable's sale price.
• D. No adjustment is needed because garages do not affect value.

Answer: B. In the direct comparison approach you always adjust the comparable, never the subject, and you adjust it toward the subject. The comparable is superior (an extra bay), so its sale price is adjusted down to estimate what it would have sold for as a single-garage home like the subject. Adjusting the wrong property in the wrong direction is the classic mark-loser in this chapter.

10. Residential tenancies

A landlord in BC rents a suite for $2,000 a month and asks for a $1,500 security deposit. Under the Residential Tenancy Act, which statement is correct?

• A. The deposit is allowed because it is less than one month's rent.
• B. The maximum security deposit is half of one month's rent, so the most the landlord may require is $1,000.
• C. Security deposits are not permitted for residential tenancies in BC.
• D. The deposit may be any amount as long as it is returned with interest.

Answer: B. The RTA caps the security deposit at half of one month's rent. A separate pet damage deposit, where applicable, is also capped at half a month's rent. Tenancy questions on the exam are usually about limits like this one, and about the framework of rights and obligations rather than procedural detail. Rules change over time, so always confirm the current figures with the Residential Tenancy Branch.

11. Land use

A homeowner wants to build a garage closer to the property line than the zoning bylaw's setback allows. Which body has the authority to grant a development variance permit?

• A. The Land Title and Survey Authority.
• B. The BC Financial Services Authority.
• C. The local government (the municipal council or regional district board).
• D. The property's mortgage lender.

Answer: C. Zoning and the permits that vary it are local government functions. The Land Title and Survey Authority deals with title and survey, BCFSA regulates licensees and financial services, and a lender has no say in land use. Land use questions reward knowing who does what.

12. Property transfer tax

A buyer who does not qualify for any exemption purchases a home in BC for $700,000. Using the general property transfer tax rates (1% on the first $200,000 of fair market value and 2% on the portion from $200,000 up to $2,000,000), how much property transfer tax is payable?

• A. $7,000
• B. $12,000
• C. $14,000
• D. $10,000

Answer: B. 1% of $200,000 is $2,000. The remaining $500,000 is taxed at 2%, which is $10,000. Total: $12,000. Option C is 2% of the whole price, option A is 1% of the whole price, and option D forgets the first bracket. The exam likes this calculation because it is simple arithmetic wrapped in a rule, and the rule has brackets. Exemption thresholds change with provincial budgets, so check the current rules with the Province of BC before advising anyone.

What your score means

• 11 or 12 correct: you are reading fact patterns the way the exam wants. Spend your remaining time on timed full-length mocks and calculator speed.
• 8 to 10 correct: solid, with two or three chapters to shore up. Note which ones and drill them this week.
• 7 or fewer: the material is not automatic yet. That is fine if your exam is more than a month away, and it is the whole reason to do questions instead of re-reading. Start with the hardest chapters.

Keep going

Twelve questions is a diagnostic, not preparation. The real thing is 100 questions in 3 hours, and the only way to be ready for that is to have done it several times before, on a screen, under the clock. RealtyPrep's chapter quizzes, custom mock exams and the full 3-hour exam simulator are built for exactly that.

Try Chapter 1 free, or take a free practice exam now and find out where you stand.