The document provides examples and step-by-step instructions for solving various types of real estate math problems commonly found on licensing exams. It addresses strategies for prorating rent and expenses, calculating profit and loss from a home sale, determining interest on a loan, and computing commissions based on a property's selling price. Examples show setting up and solving equations to find unknown values related to properties, rents, commissions, interest rates, and other financial factors involved in real estate transactions.

1. The Real Estate School
P E N N S Y L V A N I A R E A L E S T A T E E X A M
REAL ESTATE MATH CONCEPTS
1

2. TEST TAKING STRATEGIES FOR MATH
▪ If you are challenged with math –
skip all the math questions until the
end
▪ Usually one answer makes no sense
at all
▪ There are 7 questions that deal with
math. Even if you get every math
question wrong – you can still pass
the test
2

3. SOLVING REAL ESTATE MATH PROBLEMS
3
1. Get rid of the words
2. Label your numbers
3. What are they asking for?
4. Does the answer make
sense?
5. Work backwards

4. ONE ACRE = 43,560
4
4
/
3 5
6

5. PRORATIONS (PAGE 3)
5
2. A landlord has collected the June rent from all five tenants in
her apartment building; two at $700 and three at $825. If the
landlord sells her apartment building on June 23rd, how much
rent will she need to credit the buyer at settlement.
Get rid of the words: # Tenants = 5
Rent = $700/mo. and $825/mo.
Sold Date = June 23rd
Buyer Receives = ?

6. PRORATIONS (PAGE 3)
6
2. A landlord has collected the June rent from all five tenants in
her apartment building; two at $700 and three at $825. If the
landlord sells her apartment building on June 23rd, how much
rent will she need to credit the buyer at settlement.
2 tenants x $700/mo. =
3 tenants x $825/mo. =
Total rent/mo.
$ 1,400
2,475
$ 3,875
$ 3,875 ÷ 30 days = $ 129.17 Rent/day
$ 129.17 x 7 days = $ 904.17
June 1 June 30
June 23
Landlord Buyer
23 days 7 days

7. PROFIT & LOSS (PAGE 5)
7
5. When the sale of the Morgan house was closed, the title
company paid the seller’s miscellaneous closing expenses of
$250 and deducted a real estate brokerage commission of 6.5%
which was $5,200. What was the seller’s net proceeds?
Get rid of the words: Miscellaneous Expenses = $250
Commission = 6.5% or .065
Commission = $5,200
Seller Proceeds = ?

8. PROFIT & LOSS (PAGE 5)
8
5. When the sale of the Morgan house was closed, the title
company paid the seller’s miscellaneous closing expenses of
$250 and deducted a real estate brokerage commission of 6.5%
which was $5,200. What was the seller’s net proceeds?
Sales Price x .065 = $5,200
Sales Price = $5,200 ÷ .065
Sales Price = $80,000
Sales Price
Less: Commission
Less: Misc. Exp.
Seller’s Net Proceeds
$ 80,000
- 5,200
- 250
$ 74,550
÷

9. PRINCIPAL & INTEREST (PAGE 8)
9
4. What will the quarterly interest payments be on a $16,500 loan
at 8.75% interest for 1 year?
Get rid of the words: Quarterly Interest Payment = ?
Loan Amount = $16,500
Interest Rate = 8.75% or .0875

10. PRINCIPAL & INTEREST (PAGE 8)
10
4. What will the quarterly interest payments be on a $16,500 loan
at 8.75% interest for 1 year?
Loan Amount x Interest Rate = Interest Payment/yr.
$16,500 x .0875 = Interest Payment/yr.
$1,443.75 = Interest Payment/yr.
$1,443.75 ÷ 4 quarters = $360.94/Quarter

11. COMMISSION & SELLING PRICE (PAGE 10)
11
6. Alice took a listing for her company which sold for $182,500.
Emma, who works for a different company, produced the
purchasers. The brokers have agreed to divide the 7%
commission equally. What amount will Alice receive if she is on
a 55/45 split with her company?
Get rid of the words: Sales Price = $182,500
Commission Rate = 7% or .07
Split Between Companies = 50% or .50
Alice’s Commission Split = 55% or .55

12. COMMISSION & SELLING PRICE (PAGE 10)
12
6. Alice took a listing for her company which sold for $182,500.
Emma, who works for a different company, produced the
purchasers. The brokers have agreed to divide the 7%
commission equally. What amount will Alice receive if she is on
a 55/45 split with her company?
Sale Price x Commission Rate = Commission Amount
$182,500 x .07 = Total Commission
Total Commission = $12,775
$12,775 x .50 = Listing Commission
Listing Commission = $6,387.50
$6,387.50 x .55 = Alice’s Commission = $3,513.13