Idaho Real Estate Practice Exam
(Free Questions & Answers)

Explanation

The Idaho Real Estate Commission (IREC) is the state agency responsible for licensing, regulating, and disciplining real estate brokers and salespersons in Idaho.

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Idaho law requires licensees to provide an agency disclosure at the first substantial contact with a consumer. This ensures buyers and sellers understand the agent's role and representation in the transaction.

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A contract is formed when the offeror (buyer) is notified of the offeree's (seller's) acceptance. Signing alone does not create a contract — the acceptance must be communicated to the buyer.

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Idaho is a lien theory state where a mortgage is the primary security instrument. The borrower retains legal title and grants the lender a lien on the property. (Some states use a deed of trust, which involves three parties: borrower, lender, and trustee.)

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Tenancy in common does not include the right of survivorship. Each co-owner holds a separate, divisible interest that passes to their heirs upon death, not to the surviving co-owners.

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The income capitalization approach is most appropriate for income-producing properties such as apartment buildings, office buildings, and retail centers. It estimates value based on the property's ability to generate income.

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Blockbusting (also called panic selling) is the illegal practice of inducing property owners to sell by making representations about the entry of minority groups into the neighborhood, suggesting property values will decline.

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A deed is the legal instrument that transfers ownership (title) of real property from the grantor (seller) to the grantee (buyer). The deed must be properly executed, delivered, and accepted to be effective.

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Down payment = $425,000 × 20% = $85,000. Loan amount = $425,000 − $85,000 = $340,000. To solve this, multiply the relevant values: $425,000 at 20%.. The correct answer is $340,000.. This is a common calculation on the Idaho real estate exam.

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CERCLA, passed in 1980, created the Superfund program to clean up contaminated sites. It established liability for cleanup costs and allows the EPA to pursue responsible parties, including current and former property owners.

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A nonconforming use was a legal use that existed before a zoning change was enacted. The use is 'grandfathered in' and may continue, but the property owner generally cannot expand, rebuild, or resume the use after abandonment.

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A property manager's primary responsibility is to maximize the owner's return on investment (through rental income and expense management) while maintaining and preserving the property's physical and economic value.

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Idaho requires 90 hours of pre-license education for a real estate salesperson license before candidates may sit for the licensing exam.

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Even though a buyer's agent represents the buyer, they still owe the seller honest dealing and disclosure of material facts. They do NOT owe the seller loyalty, confidentiality, or full fiduciary duties — those are owed exclusively to the buyer.

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A listing agreement is an employment contract between the property owner (seller) and the broker, authorizing the broker to act as the seller's agent to find a buyer. Both parties have obligations, making it a bilateral contract.

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LTV ratio = Loan Amount ÷ Appraised Value (or purchase price, whichever is lower). A higher LTV means the borrower has less equity, which typically increases lender risk and may require private mortgage insurance (PMI).

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Idaho is a community property state. Property acquired during marriage is generally considered community property and owned equally (50/50) by both spouses, unless it was received as a gift or inheritance (separate property).

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Functional obsolescence is a loss in value due to outdated or inadequate design features, such as a house with only one bathroom, small closets, or an outdated floor plan that doesn't meet current buyer expectations.

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The Department of Housing and Urban Development (HUD) is the primary federal agency responsible for administering and enforcing the Fair Housing Act. Complaints may also be filed in federal court or with a HUD administrative law judge.

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A title search reviews public records to trace the chain of title and identify any liens, encumbrances, easements, or other claims on the property. It is typically conducted before closing to ensure the seller can convey clear title.

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Property Value = Gross Monthly Rent × GRM. $2,400 × 120 = $288,000. Using the values given ($2,400), apply the appropriate formula.. The correct answer is $288,000.. This is a common calculation on the Idaho real estate exam.

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Federal law requires sellers and landlords of residential properties built before 1978 to disclose known lead-based paint hazards. Lead paint was banned for residential use in 1978.

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A variance grants permission to deviate from specific development standards (such as setbacks, height limits, or lot coverage) when strict application of the standards would cause undue hardship. It does not change the zoning classification.

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A property management agreement is a contract (an agency/employment contract) that authorizes the property manager to act as the owner's agent. It specifies the manager's authority, duties, compensation, and the duration of the agreement.

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The Idaho real estate salesperson licensing exam contains 140 questions. Candidates must achieve a passing score of 70%.