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

Which of the following best describes a flat rental fee?

1. A fee that varies based on market conditions

2. A fixed cost paid by the tenant under a gross lease

3. A percentage of the property value

4. Revenue sharing from property sales

The correct answer is: A fixed cost paid by the tenant under a gross lease

A flat rental fee refers to a consistent, unchanging amount that a tenant pays, typically reflected in a lease agreement. This type of fee is commonly seen in gross leases, where the landlord covers operating expenses like property taxes, insurance, and maintenance costs out of the rent collected. In this case, the tenant knows exactly how much they will pay each month, allowing for better budgeting and financial planning. Understanding this concept is essential, as it contrasts with varying fees linked to market conditions or property value. Flat rental fees eliminate fluctuations in cost, making them a stable choice for tenants. Other options describe different financial arrangements, such as percentage-based fees or revenue sharing, which involve variable calculations and are not considered flat fees. Therefore, a flat rental fee is distinctly characterized by its fixed nature in a gross lease scenario.