Try 8 free Florida real estate business questions, with explanations for every answer and six worked examples. No account needed.
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8 practice questions on real estate business, scored, each with a full explanation after you answer. Every question is also written out below if you would rather study at your own pace.
| Clue in a question | Best match |
|---|---|
| Rent and repairs for an absentee owner | Property management |
| Budgets and meetings for a community association | Check the CAM role and licensing conditions |
| An ordinary brokerage report suggesting a listing price | CMA or BPO, depending on the report |
| A builder starts a home before finding a buyer | Speculative construction |
| Compensation offers within an MLS subject to NAR policy | Policy 8.11 prohibits those offers in the MLS |
| Substantially all pay tied to output, plus the required license and written contract | Statutory nonemployee for federal taxes; Florida licensing duties continue |
01 / Understand the business
A seller needs a price, a marketing plan, and a buyer who can complete the purchase. A broker brings local market knowledge and transaction experience to that work.
Legal authority
An active license authorizes brokerage work within its scope. A sales associate works under a broker, or in an authorized owner-developer arrangement. Separate credentials govern roles such as CAM and mortgage loan originator.
Professional membership
REALTOR identifies membership in the National Association of REALTORS. Florida Realtors and local associations serve the profession at the state and local levels. State licensure does not automatically enroll an associate in these organizations.
Market expertise
An associate might focus on one neighborhood, learn its competing listings, and keep in touch with interested buyers. The focused market is a farm area; maintaining useful contact is follow-up.
A sale also creates work for lenders, surveyors, builders, title professionals, and insurers. Each contributes expertise the others rely on.
02 / Sales specialties and other services
The syllabus names five sales specialties. The property or business being sold identifies the category.
Homes and other residential property.
Helping a household buy a condominium.
Property used for commerce, such as shops and offices.
Marketing a neighborhood retail center.
Property suited to manufacturing, storage, and distribution.
Finding a buyer for a distribution warehouse.
Farms, ranches, groves, and other agricultural property.
Selling an operating citrus grove.
Business enterprises and business opportunities, with or without a land transfer.
Brokering the sale of a café operating in leased space.
Business-opportunity brokerage can fall under Chapter 475 even when no land is included. Property management is another industry service, rather than one of the five sales specialties. FREC Course I syllabus, Section 1 · F.S. 475.01: brokerage and employment relationships
The management agreement defines the job: perhaps finding tenants, collecting rent, arranging repairs, and reporting to an absentee owner. The manager protects the investment and works to improve the owner's return. Leasing for another for compensation can require a real estate license, unless an exemption applies.
A CAM handles association budgets, meetings, assessments, and similar operations. Florida's definition covers specified skilled management work done for pay when the association has more than 10 units OR a budget above $100,000 annually. Certain supervised clerical and maintenance-only roles are excluded. A real estate license does not supply a CAM credential.
A loan originator helps with mortgage applications and loan terms. Accepting applications or negotiating those terms for compensation is regulated work. A real estate license alone does not authorize it; separate licensing or registration requirements and exemptions govern the role.
A counselor might examine whether a proposed development makes sense for its market. The work draws on demand, permitted uses, costs, and financing. The value lies in sound analysis and relevant expertise.
An individual condominium owner may hire a property manager while the association hires a CAM. The address can be the same; the client and duties differ.
Apply and compare offers → choose a loan → supply documents for underwriting → review final terms → close. The originator helps with the application and terms; underwriting evaluates the loan for approval. The real estate professional coordinates the property transaction.
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03 / Appraisal, CMA, and BPO
A seller choosing a listing price and a lender evaluating collateral need different reports. Start with the purpose of the assignment.
A supported opinion of value for a defined assignment.
A lender orders an appraisal for a purchase loan.
The assignment determines the required credentials and standards. A broker cannot claim an appraiser credential they do not hold.
A comparative market analysis helps a buyer or seller choose a price.
An associate compares recent sales with a seller's home before suggesting a listing price.
An ordinary brokerage CMA cannot be described as an appraisal.
A broker price opinion estimates a property's price.
A broker supplies a requested pricing report using property and market information.
A BPO can be a paid service. The fee does not make it an appraisal.
Real estate licensees conducting appraisals must follow USPAP. F.S. 475.25(1)(t) excepts ordinary-course brokerage CMAs, BPOs, and opinions of value. F.S. 475.612 limits appraisal titles and reports. That exception allows brokerage pricing work; it does not allow a CMA to be presented as an appraisal.
04 / From a tract of land to completed homes
Buying acreage, installing its streets, and building its houses are three different activities. Follow the project in that order.
Stage 1
Investigate a site and obtain the interest needed for the project. Buying the acreage belongs here.
Stage 2
Create lots and prepare streets, drainage, and utilities. The subdivision plat records the layout through the required process.
Stage 3
Build the homes or other planned buildings on the prepared site.
A plat maps the lots and layout. Dedication provides land for a stated public use. Under F.S. 177.081, a compliant recorded plat can dedicate public areas, with any stated reservations. Government construction or maintenance duties do not follow automatically.
Who has committed to buy?
A spec home is built without a committed buyer, in anticipation of finding one. The builder takes the risk that it will sell on acceptable terms.
Whose requirements shape the home?
A home built for a particular buyer to agreed specifications. The buyer and plans are identified before that custom construction proceeds.
How is the building program organized?
A development produces multiple homes from a limited selection of plans. A tract builder can also build individual homes on speculation; these labels describe different features.
A spec home can belong to a tract development. These labels describe the buyer commitment and the building program, respectively. FREC Course I syllabus, Section 1
05 / Identify the source of authority
A proposed retail building may need local zoning approval, compliance with Florida building rules, and compliance with federal law. The responsibilities overlap without becoming identical.
A parcel or project
Cities and counties handle local planning, zoning, and ordinary permitting and inspections. They generally enforce the Florida Building Code, with statutory exceptions.
Florida-wide regulation
Florida sets licensing law and adopts the statewide building code. FREC regulates real estate licensees within its statutory powers.
National rules and programs
Federal income taxes, fair housing, and national housing and lending programs affect real estate. State requirements may apply alongside them.
A professional association may set membership or service rules. It does not issue a Florida real estate license or approve a city zoning application.
06 / Current industry-policy context
NAR policies govern the MLS participants and services within their scope. The following rules explain current practice alongside the syllabus's introduction to professional organizations and MLS cooperation.
No, under NAR Policy 8.11. An MLS subject to that policy cannot carry compensation offers to other participants or subscribers. A listing's presence in the MLS does not promise payment to a buyer's broker.
Before a home tour, when an MLS participant is working with the buyer under NAR Policy 8.13, unless inconsistent with state or federal law or regulation. NAR includes live virtual tours. An independent open-house visit has different facts; see the worked example below.
It must clearly disclose the amount, rate, or method for calculating compensation; make it objectively ascertainable; limit payment from any source to the agreed amount or rate; and state that fees are fully negotiable. An open-ended promise to take whatever the seller offers fails that test.
The NAR buyer agreement addresses services and compensation. Florida law determines the permitted brokerage relationships and disclosure duties. Signing one form does not establish that every separate requirement has been met.
07 / Employee or independent contractor?
The IRS rule requires a real estate license, substantially all pay tied to sales or output, and a written contract with the specified federal-tax treatment.
Check 1
The special federal rule applies to licensed real estate agents. A job title by itself is insufficient.
Check 2
Substantially all payments must relate to sales or other output instead of the number of hours worked.
Check 3
The services must be performed under a written contract stating that the person will not be treated as an employee for federal tax purposes.
Qualifying agents are self-employed for federal income and employment taxes. F.S. 475.01(2) preserves the broker's and associate's licensing responsibilities. Federal tax status alone does not decide other employment-law questions.
Try before you reveal
Try each example before revealing the answer. Explain which fact decides it, especially when two roles or rules sound similar.
Worked scenario 01
One manager collects rent for the owner of a single condominium. Another prepares the budget and coordinates board meetings for a 40-unit condominium association, for a fee. Which task points to CAM work?
The paid management of the association's budget and meetings.
The association, the specified management functions, and the unit count matter. Managing an individual owner's rental and managing the owners' association are different assignments. A job title alone does not decide the licensing requirement.
Worked scenario 02
An associate prepares a CMA to help a seller choose an asking price. The seller asks the associate to rename it a certified appraisal for the buyer's lender. Is that acceptable?
No. The report's purpose, standards, and credentials do not change with its title.
Florida prohibits describing an ordinary brokerage CMA or price opinion as an appraisal. The associate cannot claim an appraiser credential they do not hold. The lender's required valuation must meet the lender's applicable requirements.
Worked scenario 03
An associate wants to accept mortgage applications and negotiate loan terms for a separate fee. They have only a Florida real estate license. Does that license by itself authorize the new work?
No. Covered loan origination is a separate regulated activity.
The proposed acts and compensation point to loan origination. The person must meet the applicable licensing or registration requirements, unless a relevant exemption applies. Helping coordinate a sale is not a substitute credential.
Worked scenario 04
A builder offers three floor plans in an 80-home subdivision. The builder starts one home before finding a buyer. How should you describe it?
It is a spec home within a tract development.
The absent buyer explains speculative construction. The repeated plans across the development explain tract construction. If an exam question asks which term describes building before securing a buyer, speculative is the best answer.
Worked scenario 05
A visitor attends independently. The host is acting only for the listing broker and seller. Under NAR's touring policy, must the visitor first sign a buyer agreement with that host?
No, on these facts.
NAR distinguishes an independent open-house visit from touring with a participant who is working with the buyer. A later decision to receive buyer services can change which agreement requirements apply. State and federal law still control.
Worked scenario 06
A licensed associate satisfies both IRS payment and written-contract conditions. The associate then claims that the broker no longer has to supervise their brokerage work. Is that conclusion correct?
No. Federal tax treatment does not remove Florida licensing duties.
The IRS rule determines federal tax treatment. Section 475.01(2) expressly includes independent contractors in the broker-associate employment relationship and preserves both parties' Chapter 475 responsibilities.
08 / Review every answer
Choose a question to review its answer, the reasons the other choices fail, and the supporting sources. No quiz completion or account is required.
Try each question before opening its answer. These are original practice items, not actual or recalled Pearson VUE exam questions.
Question 1 · biz-1 · A license and REALTOR membership differ
Answer B. A member of the National Association of REALTORS
The REALTOR mark identifies NAR membership. Passing the Florida exam or receiving a license does not automatically make someone a member.
Remember: License status, professional membership, and teaching approval are separate qualifications.
A. A person holding an active Florida real estate license
An active state license does not establish NAR membership.
C. A person who has met Florida broker-license qualifications
Meeting broker-license qualifications does not confer this membership mark.
D. An instructor approved to teach Florida real estate courses
Instructor approval concerns teaching. It does not confer NAR membership.
Sources: NAR: REALTOR membership marks · F.S. 475.01: brokerage and employment relationships
Report a problem with biz-1Question 2 · biz-2 · MLS information is not a compensation promise
Answer D. The MLS must not accept listings containing compensation offers to other participants or subscribers
NAR Policy 8.11 excludes these offers from the MLS, including broker-only fields. It does not ban all buyer-broker compensation. Payment terms belong in the appropriate agreements and must meet the applicable rules.
Remember: Seller approval does not create an exception to the MLS content restriction.
A. A compensation offer may appear if the seller approves it in writing
A seller’s written approval does not authorize an offer in the MLS.
B. A compensation offer may appear only in remarks visible to brokers
Restricting a field to brokers does not make a compensation offer permissible there.
C. Listing and buyer brokers are prohibited from agreeing to compensation outside the MLS
The policy restricts MLS content; it does not prohibit all separate compensation agreements.
Sources: NAR MLS Policy 8.11: compensation offers · NAR MLS Policy 8.13: written buyer agreements
Report a problem with biz-2Question 3 · biz-3 · Recognize property-management work
Answer A. Property management
The broker is managing an individual owner’s rental. The management agreement defines the work. A CAM assignment would concern the association’s affairs, such as its budget, assessments, and meetings.
Remember: The same building can involve an owner’s property manager and an association’s CAM.
B. Community association management
The broker works for the individual owner and has no assignment to manage the association.
C. Real estate appraisal
Appraisal concerns a supported opinion of value, rather than ongoing rental operations.
D. Real estate counseling
Counseling concerns analysis and advice. This assignment calls for day-to-day management.
Sources: F.S. 475.01: brokerage and employment relationships · F.S. 468.431: community association management
Report a problem with biz-3Question 4 · biz-4 · Meet both IRS conditions and keep broker supervision
Answer C. Substantially all pay tied to sales or output, plus a written contract stating nonemployee treatment for federal tax purposes
The licensed agent needs both output-based pay and the required written contract. Qualifying agents receive self-employed treatment for federal taxes. Florida broker-supervision and other licensing duties continue.
Remember: Commission pay alone is incomplete. The written-contract condition matters too.
A. Mainly hourly pay and a written agreement calling the agent an independent contractor
Mainly hourly pay fails the output condition, even if the contract uses the independent-contractor label.
B. Pay tied to sales, with only a verbal understanding about federal taxes
A verbal understanding does not satisfy the written-contract condition.
D. An active license and a written agreement, regardless of how pay is calculated
The method of payment matters. A license and contract cannot replace the output condition.
Sources: IRS: statutory nonemployees · F.S. 475.01: brokerage and employment relationships
Report a problem with biz-4Question 5 · biz-5 · Separate land acquisition from site development
Answer C. Subdivision and site development
Creating lots and installing site infrastructure are subdivision and development activities. Acquisition came first; house construction and the sale or lease of completed property follow.
Remember: Identify the current activity in the project.
A. Land acquisition
Acquisition concerns obtaining the land, which the developer already owns.
B. Home construction
The houses have not yet been built.
D. Sales and leasing of completed property
The question describes preparing the site, not selling or leasing completed buildings.
Sources: FREC Course I syllabus, Section 1
Report a problem with biz-5Question 6 · biz-6 · Spec describes building before a buyer commits
Answer B. Speculative construction
A spec home begins without a committed buyer. A custom home serves an identified buyer’s specifications. Tract construction describes a development using a limited set of plans, and can include spec homes.
Remember: The absent buyer identifies speculation. Repeated plans identify tract construction.
A. Custom construction
Custom construction serves an identified buyer, which these facts do not provide.
C. Tract construction
Tract construction concerns the development’s building program. It does not specifically describe the absence of a buyer.
D. Subdivision development
Subdivision development concerns lots and site preparation rather than this decision to build a house.
Sources: FREC Course I syllabus, Section 1
Report a problem with biz-6Question 7 · biz-7 · Distinguish local enforcement from statewide rules
Answer D. Determining whether the proposed use meets local zoning requirements
The city applies its local zoning requirements to the proposed use. State licensing, statewide code adoption, and federal housing programs belong to different authorities. Local officials also generally enforce the Florida Building Code, with statutory exceptions.
Remember: Local enforcement and statewide adoption are different responsibilities.
A. Issuing Florida real estate sales associate licenses
A Florida sales associate license is issued through the state licensing system.
B. Adopting the Florida Building Code for statewide use
Florida adopts its statewide building code at the state level.
C. Administering a federal mortgage-insurance program
A federal mortgage-insurance program is a national responsibility.
Sources: F.S. 163.3202: local land-development regulations · F.S. 553.80: building-code enforcement · F.S. 553.73: Florida Building Code
Report a problem with biz-7Question 8 · biz-8 · A trade association is not the licensing regulator
Answer A. Membership does not replace the active state license required for the work
Association membership cannot replace the required active state license. NAR, Florida Realtors, and local associations are professional organizations. Florida’s licensing system determines whether the associate is authorized to practice.
Remember: Renewing a membership and maintaining a state license are separate tasks.
B. Paid membership permits practice until the next association renewal
Association dues do not create a grace period for unlicensed practice.
C. The local association can reactivate the state license by confirming membership
A trade association does not have authority to reactivate a state license.
D. Membership automatically keeps the state license active
Paying dues does not automatically renew or maintain the state license.
Sources: F.S. 475.42(1)(a): active license required · NAR: REALTOR membership marks
Report a problem with biz-809 / Match the exam outline
Use this map to find the guide section and practice questions for each heading in the published outline.
The industry's role, local expertise, and the difference between a license and a professional membership.
Five sales specialties, management, valuation, financing, counseling, and employment status.
Acquisition, subdivision, plat dedication, and spec, custom, and tract homes.
Local, state, and federal responsibilities.
REALTOR membership and MLS policy, with current buyer-agreement context.
DBPR sales associate exam outline, Section I supplies the 1% weight and five headings. FREC Course I syllabus, Section 1 Section 1 supplies the learning objectives. The MLS-policy material adds current industry context to those objectives.
Take the eight-question quiz first. For each missed answer, find the fact you overlooked, then use the comparison guide or a worked scenario to try that distinction again.
The published outline assigns this topic 1%, about one question on the 100-question exam. Once you can explain these distinctions, move on to the larger topics. Section 1 of the Course I syllabus sets the scope; the MLS section adds current industry-policy context.
Real estate business questions
The published DBPR sales associate outline assigns this area 1%, about one question on the 100-question exam. Its five headings are Introduction, Real Estate Brokerage, Development and Construction, Role of Government, and Professional Organizations. The eight practice questions are a sample; use the guide and worked scenarios for the wider Section 1 objectives.
Residential, commercial, industrial, agricultural, and businesses. These classify sales specialties. Property management, appraising, financing, and counseling are other services covered in the same course section. Keep the five sales categories separate from the broader list of industry activities.
A real estate license and REALTOR membership are separate. The REALTOR mark identifies membership in the National Association of REALTORS. Passing the Florida exam or receiving a state license does not automatically create that membership.
Farming means focusing marketing and local knowledge on a chosen area or property market. An associate might specialize in one neighborhood or condominium market. Agricultural property is not required. Follow-up keeps useful contact with prospects or customers after the first conversation.
A property manager works on an owner’s property under a management agreement, often handling rentals and maintenance. A CAM manages a community association’s affairs. Florida’s CAM definition applies to specified paid management functions when an association has more than 10 units or an annual budget over $100,000, with stated exclusions for certain clerical and maintenance-only work.
A CMA compares market information to help with a listing or offer price. A BPO is a broker price opinion. An appraisal is a valuation assignment subject to its applicable credential and professional-standard requirements. Florida does not allow an ordinary brokerage CMA or price opinion to be described as an appraisal. A paid BPO does not become an appraisal simply because a fee is charged.
An ordinary-course brokerage CMA or BPO falls within the exception in F.S. 475.25(1)(t). Appraisal work has different standards and limits. USPAP means Uniform Standards of Professional Appraisal Practice. A real estate licensee cannot claim a state appraiser credential they do not hold or use the CMA exception to mislabel an appraisal assignment.
It does not automatically authorize covered mortgage-loan-origination work. Accepting applications or negotiating mortgage terms for compensation can require a separate credential under the applicable licensing or registration rules, subject to exemptions. Real estate brokerage and loan origination are different regulated activities.
Land acquisition, subdivision and development, and construction. Buying the tract is acquisition. Creating lots and installing site infrastructure are development activities. Building houses is construction. The subdivision plat records the layout through the required process; a marketing sketch is not a substitute for that recorded document.
Spec construction starts without a committed buyer. Custom construction serves an identified buyer’s agreed requirements. Tract construction uses a limited set of plans across a development. The terms can overlap: a home built on speculation can be part of a tract development.
Not automatically. Under F.S. 177.081, a compliant recorded plat can dedicate streets and other areas to public use, subject to what the plat states. The statute does not by itself require government construction or maintenance; that obligation must be voluntarily assumed.
NAR Policy 8.11 bars offers of compensation to other participants and subscribers in an MLS subject to that policy. It does not establish a standard commission or prohibit all buyer-broker compensation. Check the relevant agreements and rules instead of assuming a listing promises payment.
Under Policy 8.13, an MLS participant working with a buyer needs the agreement before touring a home, subject to state and federal law or regulation. NAR includes live virtual tours in its guidance. The agreement must contain the required compensation disclosures and limits. An independent open-house visit is a different case.
No. The IRS rule for a licensed real estate agent requires substantially all pay to relate to sales or output rather than hours, plus a written contract providing nonemployee treatment for federal tax purposes. Florida broker-associate responsibilities still apply. Federal tax classification does not decide every other employment-law question.
The guide covers rules in effect through September 6, 2026, with sources checked September 9. It uses the Course I syllabus effective January 1, 2023, and the DBPR candidate booklet effective January 2025. These remain the published references used for this topic. Current NAR policy is identified separately from Florida law.
Yes. The eight questions, every answer explanation, and six worked scenarios are free without an account. Continue with brokerage activities and authorized relationships. Open the Pass Florida web app or download the app to practice across all 19 topics, review missed answers, and take full-length timed exams. These are original practice questions.
Sources and editorial review
Published by Pass Florida. Reviewed on for material applicable through .
The source check covers the eight questions, every answer choice, and the six worked scenarios. Citations beside the explanations lead to the relevant law, policy, or learning objective.
Exam scope comes from the January 2025 candidate booklet and the Course I syllabus effective January 1, 2023. These are the published DBPR references used here. The source groups distinguish government requirements from private industry policy.
The questions are original practice items. This guide is published independently by Pass Florida and is not endorsed by DBPR, FREC, or Pearson VUE.
Found something to correct? Use the link under a question or send the editorial team a correction.
Review a definition, worked example, or common exam trap before your next quiz.