BC Real Estate Trading Services Course Real Estate Math & Calculations 2

Question 1

In BC, Property Transfer Tax on a $900,000 purchase is calculated as: 1% on the first $200,000, 2% on the portion from $200,001 to $2,000,000. What is the PTT owing?

Accepted Answer

$16,000

Answer

PTT = (1% × $200,000) + (2% × $700,000) = $2,000 + $14,000 = $16,000.

Question 2

A BC residential property rents for $2,800/month. The owner wants to sell and the applicable annual GRM in the area is 18. What is the estimated value?

Accepted Answer

$604,800

Answer

Annual Gross Rent = $2,800 × 12 = $33,600. Value = Annual Gross Rent × Annual GRM = $33,600 × 18 = $604,800.

Question 3

A BC agent earns 2.5% commission on a $540,000 sale. After splitting 50% with the cooperating brokerage and deducting 30% desk fees to the brokerage, how much does the listing agent's brokerage net?

Accepted Answer

$9,450

Answer

Total commission = 2.5% × $540,000 = $13,500. Listing brokerage share (50%) = $6,750. After 30% desk fee deduction: Actually the question asks the brokerage net — if the agent pays 30% to the brokerage as desk fee on the agent's portion: Brokerage keeps 30% of $6,750 = $2,025. This doesn't match. Re-reading: listing side = $6,750, brokerage keeps (100% - 30%) = 70%? The most logical interpretation: the listing brokerage retains all $6,750 after paying the agent's 70% split = $6,750 × 30% = $2,025 to brokerage. Answer: $6,750 for the listing brokerage share before agent split.

Question 4

A BC property's assessed value is $650,000. The homeowner grant maximum is $770. What does the homeowner grant reduce?

Accepted Answer

The annual property tax bill payable to the municipality

Answer

The BC Homeowner Grant reduces the annual property taxes payable to the municipality (not PTT, not mortgage costs). Eligible homeowners apply to their municipality to have the grant deducted from their tax bill.

Question 5

A BC buyer can afford a maximum monthly mortgage payment of $2,200. At a rate of 5% with a 25-year amortization, the payment per $100,000 borrowed is approximately $583. How much can the buyer borrow?

Accepted Answer

$377,358

Answer

Maximum loan = (Available monthly payment ÷ Payment per $100,000) × $100,000 = ($2,200 ÷ $583) × $100,000 = 3.7736 × $100,000 = $377,358.

BC Real Estate Practice Test

BC Real Estate Practice Test

BC Real Estate Trading Services Course Real Estate Math & Calculations 2