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Ontario real estate exam math: practice questions with worked answers

There is some math on the Ontario real estate exams, and most of it sits in Course 2 (residential transactions) and Course 4 (commercial transactions). It is arithmetic, not algebra or statistics: percentages, areas, day counts and a few standard formulas, done on the on-screen calculator the exam platform provides. You cannot bring your own calculator unless it is approved as an accommodation, according to RECO's Learner Exam Handbook.

Below are six original multiple-choice questions in the style you will see, each with a step-by-step solution and a note on the trap built into the wrong options. For the full list of math topics, read our overview of Ontario real estate exam math.

Is there a lot of math on the real estate exam?

Not a lot, but enough that you cannot skip it. Math is concentrated in Course 2 and Course 4. In ExamPass's own practice banks, Course 1 has very little. Course 2 brings in commission, area, closing adjustments and land transfer tax. Course 4 adds income property work: net operating income, capitalization rates and lease costs. The simulations then put the same calculations inside longer scenarios.

There is no separate math course in the RECO program. The math sits inside Course 2 and Course 4, so a "real estate math course" in practice means drilling those calculations until the setup is automatic.

Does real estate require math once you are registered?

Yes, at the same level. Salespersons and brokers check commission statements, estimate closing costs and compare lease offers. None of it goes beyond high school arithmetic; the hard part is choosing the right figure from a scenario full of figures.

Time is rarely the problem: Exam 2 and Exam 4 each give you 3 hours for 115 questions, a little over a minute and a half each. A bad setup is what eats the clock.

Question 1: commission split with HST

Darnell Okafor's house in Kingsville Heights sells for $684,000. The listing agreement sets a total commission of 4.5% of the sale price, plus HST at 13%. The listing brokerage keeps 2.5% and pays 2% to the cooperating brokerage. How much does the listing brokerage receive, including HST?

  • A. $17,100.00
  • B. $19,323.00
  • C. $34,781.40
  • D. $15,458.40

Answer: B.

  1. Listing brokerage's share: $684,000 × 2.5% = $17,100.00.
  2. HST on that share: $17,100.00 × 13% = $2,223.00.
  3. Total: $17,100.00 + $2,223.00 = $19,323.00.

Trap: A forgets HST, C is the whole commission with HST, and D is the cooperating brokerage's share with HST.

Question 2: area of an irregular lot

A lot on Wrenfield Road has a 45 foot frontage. The east lot line runs 130 feet and the west lot line runs 100 feet, both at right angles to the front, so the rear line slants. What is the lot area in square metres, to one decimal place? (1 foot = 0.3048 metres.)

  • A. 543.5 m²
  • B. 418.1 m²
  • C. 480.8 m²
  • D. 1,577.3 m²

Answer: C.

  1. Split the lot into a rectangle and a triangle. Rectangle: 45 × 100 = 4,500 sq ft.
  2. Triangle: the extra 30 feet of depth on the east side. ½ × 45 × 30 = 675 sq ft.
  3. Total: 4,500 + 675 = 5,175 sq ft. (Same result as the average depth method: 45 × 115.)
  4. Convert: one square foot is 0.3048 × 0.3048 = 0.09290304 m². So 5,175 × 0.09290304 = 480.8 m².

Trap: A uses the longer side for the whole lot, B ignores the triangle, and D divides by the linear factor (3.28084) instead of the squared one.

Question 3: property tax proration at closing

Annual property taxes on a condominium townhouse are $5,840 for a 365-day year. The seller has paid the full year. The sale closes on June 18. Using the convention that the buyer owns the closing day, what adjustment appears on the statement of adjustments?

  • A. Credit the seller $3,152.00
  • B. Credit the seller $3,136.00
  • C. Credit the buyer $2,688.00
  • D. Credit the seller $2,920.00

Answer: A.

  1. Daily tax: $5,840 ÷ 365 = $16.00.
  2. Seller's days, January 1 to June 17: 31 + 28 + 31 + 30 + 31 + 17 = 168 days.
  3. Buyer's days, June 18 to December 31: 365 less 168 = 197 days.
  4. The seller prepaid the buyer's 197 days, so the buyer reimburses the seller: 197 × $16.00 = $3,152.00, a credit to the seller.

Trap: B gives the closing day to the seller (196 days), C credits the wrong party with the seller's own share, and D assumes a half year. If a question states a different convention for the closing day, use the question's convention.

Question 4: Ontario land transfer tax

Mei Lin, a Canadian citizen, buys a detached house in Barrie for $1,135,000. Using the provincial rates in the Land Transfer Tax Act, s. 2 (1), what is the Ontario land transfer tax? Ignore any first-time buyer rebate.

  • A. $22,700
  • B. $38,350
  • C. $19,450
  • D. $19,175

Answer: D.

Portion of priceRateTax
First $55,0000.5%$275
$55,000 to $250,000 ($195,000)1%$1,950
$250,000 to $400,000 ($150,000)1.5%$2,250
$400,000 to $1,135,000 ($735,000)2%$14,700
Total$19,175

The extra 0.5% on land with one or two single family residences applies only to the portion above $2,000,000, so it does not apply here.

Trap: A applies 2% to the whole price, C taxes the first $250,000 at 1% and skips the 0.5% band, and B doubles the tax as if a second tax applied. In the City of Toronto a separate municipal land transfer tax is added on top, but this house is in Barrie. The full method is in how Ontario land transfer tax is calculated.

Question 5: net operating income

A 12-unit apartment building rents each unit for $1,850 a month and earns $3,600 a year from laundry. Allow 4% of potential gross income for vacancy and collection loss. Annual operating expenses are $68,400 and annual mortgage payments are $96,000. What is the net operating income?

  • A. $94,800
  • B. $201,600
  • C. $190,800
  • D. $187,344

Answer: C.

  1. Potential gross rent: 12 × $1,850 × 12 = $266,400.
  2. Potential gross income: $266,400 + $3,600 = $270,000.
  3. Vacancy and collection loss: $270,000 × 4% = $10,800. Effective gross income: $259,200.
  4. Net operating income: $259,200 less $68,400 = $190,800.

Trap: A deducts the mortgage, which is financing and never part of NOI. B skips vacancy. D leaves out the laundry income.

Question 6 (the hardest): value from NOI and a cap rate

A retail plaza in Brantford has potential gross rent of $412,000 a year. Vacancy and collection loss is 5%, operating expenses are $118,600 and mortgage payments are $142,000 a year. A similar plaza nearby recently sold for $4,250,000 with an NOI of $297,500. Using the comparable's capitalization rate, what is the plaza's estimated value, rounded to the nearest dollar?

  • A. $4,191,429
  • B. $3,897,143
  • C. $5,591,429
  • D. $1,868,571

Answer: B.

  1. Market cap rate from the comparable: $297,500 ÷ $4,250,000 = 0.07, or 7%.
  2. Effective gross income: $412,000 × 95% = $391,400.
  3. NOI: $391,400 less $118,600 = $272,800. The mortgage is not deducted.
  4. Value: $272,800 ÷ 0.07 = $3,897,142.86, or $3,897,143.

Trap: A forgets vacancy, C capitalizes effective gross income instead of NOI, and D deducts the mortgage first. It is the hardest because it chains three steps. For the formula itself, see the IRV formula explained, and for what the rate tells you about risk, see cap rate in commercial real estate.

What do these six questions have in common?

Every wrong option is a real number produced by a real mistake, so matching an option proves your arithmetic, not your setup. Name the figure asked for before you start, strip out what does not belong (such as mortgage payments in an NOI question), and estimate first: a plaza netting about $270,000 at 7% is worth about $3.9 million, so $1.9 million or $5.6 million should stop you.

Frequently asked questions

Is there a calculator on the Ontario real estate exam? Yes. The exam platform provides an on-screen calculator and a virtual notepad. A personal calculator is not allowed unless it is approved as an accommodation.

Which course has the most math? Course 2 and Course 4. Course 2 covers commission, area, adjustments and land transfer tax, and Course 4 adds income property math such as NOI and cap rates.

What is the hardest type of math question? Multi-step income questions, like Question 6, where you build NOI from raw figures and then capitalize it.

Do I need to memorize land transfer tax rates? Know the banded method and practice it until it is routine. Questions test whether you apply each rate only to its own portion of the price.

How does ExamPass help you practice exam math?

ExamPass gives you hundreds of original questions across Course 2, Course 4 and the simulations, including calculation questions where every option is explained, so you see which mistake produced each wrong answer. The Study notes walk through each method, and Drill Wrong Answers and the AI Tutor help you fix the setups you keep getting wrong. Try the free Course 2 practice questions and Course 4 practice questions. See courses and pricing

ExamPass is an independent study aid. It is not affiliated with or endorsed by RECO, Meazure Learning, Humber Polytechnic, Career College Group, Fleming College, Algonquin College, or any other education provider. Provider and exam names are used only to identify the courses students are preparing for.