Real Estate Contracts: Free Florida Real Estate Practice Questions

1. 1. Which of the following is NOT one of the essential elements required to form a valid real estate contract in Florida?

   • A) Offer and acceptance (mutual assent)
   • B) Competent parties with legal capacity
   • C) Consideration and a lawful object
   • D) Notarization of both parties' signatures
   Show answer & explanationHide answer

   Correct answer: D) Notarization of both parties' signatures

   The four essential elements of a valid contract are offer and acceptance, competent parties, consideration, and lawful object/purpose. Notarization is not required for a contract to be valid or enforceable; it is required for deeds to be recorded but is not a contract-formation element. A contract missing any of the four true essentials is void.

2. 2. A seller is selling a home located within a Community Development District (CDD). Under F.S. 190.048, which of the following correctly states the seller's disclosure obligation?

   • A) The seller must include a written CDD disclosure in the contract prior to closing, informing the buyer that additional assessments may be imposed beyond county and city taxes
   • B) CDD disclosure is required only when annual assessments exceed $1,000 per year
   • C) CDD disclosure is required for new construction only; resale properties are exempt
   • D) The buyer's mortgage lender is responsible for disclosing the CDD assessment in the loan documents
   Show answer & explanationHide answer

   Correct answer: A) The seller must include a written CDD disclosure in the contract prior to closing, informing the buyer that additional assessments may be imposed beyond county and city taxes

   F.S. 190.048 requires any seller of property within a Community Development District to include a written disclosure statement in the contract for sale and purchase prior to closing. The disclosure must advise the buyer that the property is within a CDD, that CDD assessments are levied in addition to county and municipal property taxes, and how to contact the district. There is no dollar threshold, and no exemption exists for resale properties.

3. 3. A seller instructs a broker: 'Sell my house for anything above $350,000 -- keep everything over that as your commission.' This arrangement is:

   • A) Legal as a valid open listing with a performance incentive
   • B) Legal as an exclusive agency listing if put in writing
   • C) Legal provided the seller acknowledges the arrangement in writing
   • D) Illegal -- net listings are prohibited in Florida
   Show answer & explanationHide answer

   Correct answer: D) Illegal -- net listings are prohibited in Florida

   Net listings -- in which the broker's compensation is the difference between a minimum seller net and the actual sale price -- are illegal in Florida because they create a direct conflict of interest: the broker profits more by securing the lowest possible price for the seller. Florida law requires broker compensation to be stated as a definite percentage or flat fee, not as a residual. A broker who enters a net listing agreement is subject to disciplinary action by FREC.

4. 4. A buyer pays a seller $3,000 for a 90-day option to purchase a commercial property at $600,000. The buyer conducts due diligence but ultimately decides not to exercise the option. What is the correct outcome?

   • A) The seller must refund the $3,000 because no sale occurred
   • B) The buyer may apply the $3,000 as a credit toward a future purchase from the same seller
   • C) The seller retains the $3,000 and has no further obligation to the buyer
   • D) The buyer forfeits half the consideration and may recover the remaining $1,500
   Show answer & explanationHide answer

   Correct answer: C) The seller retains the $3,000 and has no further obligation to the buyer

   An option contract is a unilateral contract in which the optionor (seller) receives consideration to keep an offer open, and the optionee (buyer) has the right -- but no obligation -- to purchase within the option period. If the optionee does not exercise the option, the consideration paid is forfeited to the optionor; no partial or full refund is owed. The seller is then free to sell the property to any other buyer.

5. 5. A seller signs a contract to sell her home but refuses to close after receiving a higher offer. Which legal remedy is MOST distinctively associated with real estate contract breaches compared to personal property contracts?

   • A) Specific performance, compelling the seller to convey the property as contracted
   • B) Compensatory damages equal to the seller's profit on the higher offer
   • C) Punitive damages to punish the seller's bad-faith conduct
   • D) Rescission and return of the earnest money deposit only
   Show answer & explanationHide answer

   Correct answer: A) Specific performance, compelling the seller to convey the property as contracted

   Because every parcel of real property is considered legally unique, courts may grant specific performance -- a remedy compelling a breaching party to complete the transaction as agreed. This remedy is rarely available for personal property because money damages are typically considered an adequate substitute. While compensatory damages and rescission are also available, specific performance is the remedy most distinctively tied to real property.

6. 6. A seller is selling a home built in 1971. Under the federal Residential Lead-Based Paint Hazard Reduction Act (42 U.S.C. § 4852d), which of the following requirements applies to this transaction?

   • A) The seller must remove all lead-based paint before the property can be listed for sale
   • B) The buyer must receive a lead-based paint disclosure, an EPA-approved pamphlet, and has 10 days to conduct a lead inspection unless waived
   • C) The seller must hire a certified inspector to test for lead paint and provide a clearance report
   • D) Lead-based paint disclosure is required only for homes built before 1950
   Show answer & explanationHide answer

   Correct answer: B) The buyer must receive a lead-based paint disclosure, an EPA-approved pamphlet, and has 10 days to conduct a lead inspection unless waived

   For all residential properties built before 1978, federal law requires sellers to disclose known lead-based paint hazards, provide buyers with an EPA-approved informational pamphlet ('Protect Your Family from Lead in Your Home'), and afford buyers a 10-day opportunity to conduct a lead paint inspection -- though buyers may contractually waive this right. The seller is not required to test for or remediate lead paint. The federal cutoff year is 1978, not 1950.

Not affiliated with Pearson VUE, the Florida DBPR, or FREC. This is an independent study tool; questions are original and verified against Florida statutes and FREC rules.