Texas Real Estate Brokerage Sales Apprentice Education (SAE) Practice Exam

How does a periodic estate differ from other lease types?

1. It has a fixed end date

2. It automatically continues in defined time periods

3. It is only valid for one year

4. It requires explicit renewal to continue

The correct answer is: It automatically continues in defined time periods

A periodic estate, commonly known as a periodic tenancy, is characterized by its automatic renewal at defined time intervals, such as weekly, monthly, or yearly. This feature distinguishes it from other lease types that may have specific endings or require explicit renewal agreements. In contrast, a lease with a fixed end date concludes on a predetermined date without any built-in provisions for renewal. Similarly, a lease that is valid for only one year does not share the periodic nature, as it must be renegotiated or renewed at the end of that term. Furthermore, leases that require explicit renewal are not automatically extended and lack the inherent continuity that periodic estates provide. The essence of a periodic estate lies in its flexibility and ongoing nature, which allows tenants to maintain occupancy without needing to re-sign a lease or negotiate terms each time a period concludes. This makes option B the accurate description of how a periodic estate differs from other lease types.