Florida Broker Practice Exam

Which type of estate does not involve an ownership interest and has a known duration?

1. Fee simple estate

2. Life estate

3. Nonfreehold estate

4. Remainder estate

The correct answer is: Nonfreehold estate

The correct answer is C, as a nonfreehold estate is characterized by its lack of ownership interest in the property. Instead, it represents a tenant's interest in the property for a specified duration, as defined in a lease agreement. This type of estate typically arises in rental situations where the tenant has the right to occupy the property for a predetermined length of time but does not hold any ownership rights. In contrast, the other options represent different types of interests that include ownership rights. A fee simple estate conveys complete ownership of the property with no time limitation, while a life estate grants ownership for the duration of an individual's life, after which the property usually reverts to another party, making both tied closely to the concept of ownership. A remainder estate also involves future interests tied to events such as the termination of a life estate, indicating an ownership transfer rather than a lease arrangement. Thus, nonfreehold estates remain distinct due to their temporary, leasehold nature and lack of rights associated with property ownership.