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Quizzes > Business & Finance > Finance & Economics

Ace Your Real Estate Math: Free Practice Quiz

Ready to tackle real estate math questions and formulas? Start the free test now!

Editorial: Review CompletedCreated By: Eric CastleUpdated Aug 27, 2025
Difficulty: Moderate
2-5mins
Learning OutcomesCheat Sheet
Paper art illustration for real estate math practice test quiz on a coral background

This real estate math practice test helps you practice key formulas for loans, commissions, and property value. Use it to spot gaps before your exam and get faster with calculations. When you finish, try the home-buying math quiz and explore real-world finance problems for more practice.

What is the commission on a $200,000 home sale if the commission rate is 6%?
$12,000
$8,000
$10,000
$6,000
A real estate commission is calculated by multiplying the sale price by the commission rate. In this case, $200,000 × 0.06 equals $12,000, which is the total commission earned. This does not account for any broker-split arrangements. .
What is the area in square feet of a rectangular lot measuring 100 feet by 50 feet?
15,000 sq ft
500 sq ft
150 sq ft
5,000 sq ft
The area of a rectangle equals length multiplied by width. Here, 100 ft × 50 ft equals 5,000 square feet. This formula is fundamental in land measurement. .
How many square feet are in one acre?
30,300 sq ft
5,280 sq ft
4,356 sq ft
43,560 sq ft
One acre is defined as 43,560 square feet. This is a standard unit of land measurement in U.S. real estate. Memorizing this conversion is essential for lot calculations. .
A seller has prepaid the annual property tax of $3,600. If the seller owns the property for 90 days and taxes are based on a 360-day year, how much must the buyer credit the seller at closing?
$3,000
$2,700
$2,800
$900
Prorated tax credit uses the daily rate: $3,600 ÷ 360 days = $10/day. The buyer owes the seller for the remaining 360?90=270 days: 270 × $10 = $2,700. .
What is the monthly interest amount on a $100,000 loan at 6% annual interest?
$1,000
$400
$600
$500
Monthly interest equals principal × (annual rate ÷ 12). So $100,000 × (0.06 ÷ 12) = $100,000 × 0.005 = $500. .
If a buyer obtains a $160,000 loan on a $200,000 purchase, what is the loan-to-value (LTV) ratio?
90%
80%
75%
85%
Loan-to-value ratio is loan amount divided by property value. $160,000 ÷ $200,000 = 0.80 or 80%. LTV is key for mortgage underwriting. .
How much does it cost in discount points if a borrower pays 2 points on a $250,000 loan?
$2,500
$10,000
$7,500
$5,000
One point equals 1% of the loan amount. So 2 points on $250,000: 0.02 × $250,000 = $5,000. Points are prepaid interest. .
A brokerage firm earns a $9,000 commission and splits it 60/40 with its agents. What is the broker's gross commission income?
$9,000
$3,600
$6,000
$5,400
Gross commission to the broker is 60% of $9,000: 0.60 × $9,000 = $5,400. The remainder goes to the agent. .
Using a mortgage factor of $5.368 per $1,000, what is the monthly payment on a $200,000, 30-year, 5% loan?
$1,000.00
$1,500.00
$1,200.00
$1,073.60
Payment per $1,000 is $5.368. For $200,000: 200 × $5.368 = $1,073.60. This factor comes from the amortization table at 5%/30yrs. .
If a property was purchased for $200,000 and sold later for $250,000, what is the percentage profit?
20%
50%
30%
25%
Profit percentage is profit ÷ cost basis. Here profit is $50,000 on $200,000: $50,000 ÷ $200,000 = 0.25 or 25%. .
A property generates a net operating income of $30,000 and is valued at $400,000. What is its capitalization rate?
7.5%
6.0%
8.0%
7.0%
Cap rate = NOI ÷ value. So $30,000 ÷ $400,000 = 0.075 or 7.5%. Investors use cap rates for valuation. .
A building cost $275,000, with land valued at $50,000. Using straight-line depreciation over 27.5 years, what is the annual depreciation?
$5,000.00
$10,000.00
$15,000.00
$8,181.82
Depreciable basis is $275,000 ? $50,000 = $225,000. Annual depreciation: $225,000 ÷ 27.5 = $8,181.82. .
A tenant pays $2,000 monthly rent. If they occupy for 12 days in a 30-day month, what is the prorated rent?
$900
$800
$700
$1,000
Daily rent = $2,000 ÷ 30 = $66.67. For 12 days: 12 × $66.67 ? $800. Proration uses a 30-day month standard. .
What is the monthly interest on a $150,000 interest-only loan at 4% annual interest?
$450
$600
$400
$500
Interest?only payment = principal × (annual rate ÷ 12). So $150,000 × (0.04 ÷ 12) = $150,000 × 0.0033333 = $500. .
After the first payment on a $100,000, 6%, 30-year loan (monthly payment $599.55), what is the approximate new principal balance?
$100,000
$99,400
$99,500
$99,900
First interest = $100,000 × (0.06 ÷ 12) = $500. Principal paid = $599.55 ? $500 = $99.55. New balance = $100,000 ? $99.55 ? $99,900. .
How much does a borrower pay if charged 2.5 discount points on an $180,000 loan?
$2,500
$3,600
$4,500
$5,000
Discount points cost = loan amount × points rate. Here 0.025 × $180,000 = $4,500. Points are prepaid interest. .
What is the market value of a property generating $50,000 NOI at a 6% capitalization rate?
$600,000
$833,333
$800,000
$750,000
Value = NOI ÷ cap rate. $50,000 ÷ 0.06 = $833,333. Cap rates reflect return expectations. .
PMI can be canceled when the LTV ratio reaches what percentage of the original value?
85%
70%
80%
78%
Under FHA guidelines, PMI can be canceled when the outstanding loan balance reaches 78% of original value. This reduces borrower cost. .
A property's potential gross income is $100,000 with a 5% vacancy rate and $5,000 other income. What is its effective gross income?
$95,000
$105,000
$90,000
$100,000
EGI = potential gross × (1 ? vacancy) + other income. $100,000×0.95 + $5,000 = $95,000 + $5,000 = $100,000. .
What is the mortgage payment per $1,000 borrowed (loan constant) for a 30-year, 6% loan?
5.99
6.00
4.50
4.99
The mortgage constant at 6% for 30 years is approximately $5.99 per $1,000 of loan. It's found in loan constant tables. .
A borrower's monthly housing expenses are $2,000, and their gross monthly income is $5,000. What is the front-end ratio?
36%
28%
50%
40%
Front-end ratio = housing expenses ÷ gross income. $2,000 ÷ $5,000 = 0.40 or 40%. Lenders use this for qualification. .
What is the return on equity if an investor puts 20% down on a $250,000 property that produces $20,000 NOI?
8%
35%
20%
40%
Equity investment is 20% of $250,000 = $50,000. ROI = NOI ÷ equity = $20,000 ÷ $50,000 = 0.40 or 40%. .
Adjusted basis of a property purchased at $200,000 with $20,000 improvements and $30,000 depreciation is:
$120,000
$130,000
$100,000
$190,000
Adjusted basis = purchase price + improvements ? depreciation. $200,000 + $20,000 ? $30,000 = $190,000. This is used to calculate taxable gain. .
What is the effective annual rate (EAR) for a loan with a 6% nominal rate compounded monthly?
6.22%
6.17%
6.12%
5.95%
EAR = (1 + 0.06/12)¹² ? 1 = 0.061678 or 6.17%. This accounts for monthly compounding. .
A property costs $200,000 and produces $20,000 NOI annually for 3 years, then sells for $250,000. Using an 8% discount rate, what is the NPV?
$40,000
$60,000
$50,260
$30,000
PV of NOI: 20k/1.08 + 20k/1.08² + (20k+250k)/1.08³ ? 18.52k + 17.15k + 214.60k = 250.27k. NPV = 250.27k ? 200k ? $50,260. .
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Study Outcomes

  1. Understand Essential Formulas -

    Identify and recall the fundamental real estate math formulas for loan amortization, commission calculations, and property tax assessments.

  2. Calculate Loan Amortizations -

    Compute monthly mortgage payments, principal - interest breakdowns, and remaining balances using standard amortization formulas.

  3. Apply Commission Calculations -

    Determine sales commissions, net proceeds, and markup percentages accurately in various real estate transaction scenarios.

  4. Analyze Practice Test Results -

    Review detailed explanations for real estate math practice questions to identify strengths, correct misconceptions, and reinforce key concepts.

  5. Utilize PDF-Style Worksheets -

    Leverage real estate math practice worksheets pdf style problems to target specific areas for study and improve calculation speed and accuracy.

  6. Evaluate Problem-Solving Strategies -

    Compare different mathematical approaches for property calculations and choose the most efficient method for each scenario.

Cheat Sheet

  1. Commission Calculations -

    Agents calculate their fee by multiplying the sales price by the commission rate (e.g., 6% of $300,000 equals $18,000). This formula - Commission = Sales Price × Commission Rate - is a staple in real estate math practice questions and is often featured in real estate math practice worksheets pdf. Remember the mnemonic "CR × SP = CF" (Commission Fee) to lock in this essential step.

  2. Loan Amortization Formula -

    Monthly mortgage payments can be found with M = P [i(1+i)^n] ÷ [(1+i)^n - 1], where P is principal, i is monthly interest rate, and n is number of payments. According to Freddie Mac and many university finance courses, mastering this formula is crucial for your real estate math practice test. Try plugging in P = $200,000, i = 0.004 (4.8% APR/12), and n = 360 to see a sample payment of about $1,050.

  3. Prorations and Daily Rate Adjustments -

    Prorations involve dividing annual costs (taxes, insurance, rent) by 365 days to find a daily rate, then multiplying by days owed. For example, $2,190 annual taxes ÷ 365 = $6 per day; buyer reimburses seller for days unused. This concept shows up frequently on real estate math practice test questions and tests your pro-rata prowess.

  4. Area and Volume Conversions -

    Know that 1 acre = 43,560 sq ft and 1 cubic yard = 27 cubic ft when calculating lot size or fill dirt. Real estate math questions often ask you to convert acreage to square feet or calculate soil volume for landscaping. A quick trick: "43K in an Acre" helps you recall the square-foot equivalent.

  5. Capitalization Rate and NOI -

    Cap rate is the ratio of net operating income (NOI) to property value: Cap Rate = NOI ÷ Value. If a building's NOI is $50,000 and its market value is $625,000, the cap rate is 8%. This formula appears in many real estate formulas math sections and is vital for assessing investment returns.

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