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

What characterizes a tenancy of years?

1. A leasehold that is indefinite in duration

2. A leasehold that expires after a designated time period

3. A lease that can be canceled at any time

4. A type of residential rental agreement

The correct answer is: A leasehold that expires after a designated time period

A tenancy of years is characterized by a leasehold agreement that has a specific beginning and ending date, meaning it lasts for a designated time period. This form of tenancy is distinct because the term is agreed upon by both the landlord and tenant in advance, providing stability and certainty regarding the length of the tenancy. This type of leasehold does not automatically renew and does not vary based on conditions; instead, it runs its course for the length of the specified term, which can be days, months, or years. Once the term is completed, the tenancy concludes without the need for further action unless both parties agree to extend or renew the lease. The other options relate to characteristics that do not reflect the defined nature of a tenancy of years. For instance, a leasehold that is indefinite in duration would refer to a periodic tenancy, which is not fixed in terms of duration, and a lease that can be canceled at any time describes a month-to-month arrangement or an at-will tenancy. Lastly, while a type of residential rental agreement may encompass various forms of leases, the specific qualities of a tenancy of years focus primarily on the fixed term structure, making option B the only accurate description of this type of leasehold.