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HK real estate exam – quiz 3
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- Question 1 of 30
1. Question
In terms of advertising a property, which of the following should a licensed estate agent consider?
I. The advertisement relating to his estate agency business must contain only accurate and not misleading information.
II. Vendor’s written approval must be acquired first before issuing any advertisement of the vendor’s residential property.
III. An advertisement may include some other information other than instructed by the vendor if the licensed estate agent sees that these will give a positive outcome.
IV. Only the price or rental or terms as instructed by the vendor should be included in the advertisement.
V. A licensee may proceed with the advertisement without prior consent from the vendor if he deemed it beneficial for the vendor.CorrectWhen advertising a property, the licensed estate agent should get first a consent from the vendor and must include only information in the advertisements as instructed by the vendor.
IncorrectWhen advertising a property, the licensed estate agent should get first a consent from the vendor and must include only information in the advertisements as instructed by the vendor.
- Question 2 of 30
2. Question
Which of the following are expected of estate agents and salespersons as stated by the Code of Ethics?
I. Estate agents and salespersons should not do any activities or actions that are against the law.
II. Estate agents and salespersons should have the knowledge and understanding of all the related laws and regulations
III. Estate agents and salespersons should uphold ethical and moral standard in performing their work.
IV. Estate agents and salespersons may not disclose a possible or potential conflict of interest as long as the effects are not detrimental or the effect is only minimal.
V. Estate agents and salespersons must provide services to clients with honesty and integrity but it is the client’s responsibility to protect themselves against fraud and other unethical practices.CorrectEstate agents and salespersons as stated by the Code of Ethics are expected to act ethically and morally in the performance of their jobs. Also, they should fully understand and keep themselves updated on all the relevant laws and regulations related to real estate transactions. They are as well expected to protect their clients from fraud and any other unethical practices.
IncorrectEstate agents and salespersons as stated by the Code of Ethics are expected to act ethically and morally in the performance of their jobs. Also, they should fully understand and keep themselves updated on all the relevant laws and regulations related to real estate transactions. They are as well expected to protect their clients from fraud and any other unethical practices.
- Question 3 of 30
3. Question
Which of the following are examples of minimizing any conflict of interest?
I. Estate agents and salespersons should not do any action which may give a negative impact on the estate agency trade.
II. Estate agents and salespersons should do their duties with due care and diligence.
III. Estate agents and salespersons should not accept any appointments or transactions for any property in which they have a beneficial interest.
IV. If events, where estate agents and salespersons are representing both the vendor and the purchaser, both the clients, must be informed.
V. Estate agents and salespersons should be updated with the latest development in the laws and regulations relevant to real estate.CorrectOne of the sections in the Code of Ethics is that estate agents and salespersons are expected to minimize any conflict of interest situations. Examples of these situations are, state agents and salespersons should not involve themselves in any transactions of a property in which they have beneficial interests. Also, in situations where they are acting as both the vendor and the purchaser, this must be known to both clients.
IncorrectOne of the sections in the Code of Ethics is that estate agents and salespersons are expected to minimize any conflict of interest situations. Examples of these situations are, state agents and salespersons should not involve themselves in any transactions of a property in which they have beneficial interests. Also, in situations where they are acting as both the vendor and the purchaser, this must be known to both clients.
- Question 4 of 30
4. Question
Identify which of the following statements is applicable to all licensees.
I. A licensee should include in all documents used in conducting estate agency work such as receipts, brochures, and advertisements for his license number and business name.
II. A licensee should make sure that all salespersons employed have a valid estate agent’s license.
III. A licensee can only do estate agency work if he has a valid license issued by EAA.
IV. A license is required to notify EAA if he changed his registered address within 14 days.
V. A licensee should immediately stop engaging in any estate work upon suspension or revocation of his license.CorrectAll licensees can only perform estate agency work if they have valid licenses. If a licensee changes his registered address, he must notify the EAA within 14 days of such change. In events that a licensee is suspended or his license is revoked, immediately after the suspension or revocation, he has to cease doing any estate work.
IncorrectAll licensees can only perform estate agency work if they have valid licenses. If a licensee changes his registered address, he must notify the EAA within 14 days of such change. In events that a licensee is suspended or his license is revoked, immediately after the suspension or revocation, he has to cease doing any estate work.
- Question 5 of 30
5. Question
Martin is a licensed estate agent who is carrying on the business of estate agency work. Which of the following statements should Martin follow and comply as stated in the Code of Ethics?
CorrectA licensed estate agent who is carrying on the business of estate agency work is required to display the relevant statement of particulars of business in an area of his place of business which is very visible to the public. If he has some change in his statement of particulars of business, he has to apply to EAA and this statement of particulars of business may be lost or damaged, he has to immediately request for a replacement.
IncorrectA licensed estate agent who is carrying on the business of estate agency work is required to display the relevant statement of particulars of business in an area of his place of business which is very visible to the public. If he has some change in his statement of particulars of business, he has to apply to EAA and this statement of particulars of business may be lost or damaged, he has to immediately request for a replacement.
- Question 6 of 30
6. Question
Identify which of the statements are applicable to companies holding an estate agent’s licence.
I. It should have at least one director who has a valid license while the other directors may not have a valid license.
II. It should notify EAA upon the appointment of a director and does not need to notify EAA when a director ceases to be one.
III. It should have at least one director who is a holder of a valid license issued by EAA.
IV. It should submit Form 11 in the Schedule of the PR to EAA to notify its appointment of a director or ceasing to be a director of a person in the company.
V. It should make sure that all of its directors are compliant to section 20(3) of the EAO.CorrectAll companies holding an estate agent’s license are required to have a least one director who has a valid license and if it has more than one, all of them should have valid licenses as well. It is also demanded to send a notification using Form 11 of the Schedule of the PR to EAA upon the appointment of a director and of stopping to be a director.
IncorrectAll companies holding an estate agent’s license are required to have a least one director who has a valid license and if it has more than one, all of them should have valid licenses as well. It is also demanded to send a notification using Form 11 of the Schedule of the PR to EAA upon the appointment of a director and of stopping to be a director.
- Question 7 of 30
7. Question
When handling the sale and purchase or lease of residential property in Hong Kong, what should be considered by a licensee?
CorrectThe licensee is required to inform the client that he is a licensed estate agent and along with that provide the client with his license number. When handling such transactions, the licensee has to complete Forms 1-6 in the Schedule of the PR.
IncorrectThe licensee is required to inform the client that he is a licensed estate agent and along with that provide the client with his license number. When handling such transactions, the licensee has to complete Forms 1-6 in the Schedule of the PR.
- Question 8 of 30
8. Question
Which of the following events require that a form must be completed?
I. When the property is a car parking space alone.
II. When acting as a purchaser and the vendor does not have representation by any estate agent.
III. When a licensed estate agent is acting for a vendor in the sale of a property.
IV. When the property for lease is not a self-contained unit.
V. When in the lease of a property, a licensed estate agent is acting for a landlord.CorrectAs state in the Code of Ethics, there are some situations where the appropriate forms are required to be completed such as when a licensed estate agent is acting for a purchaser but the vendor is not represented by an estate agent, Form 1 must be completed. Also, when a licensed estate agent is acting for a vendor, he has to complete Form 3 with the vendor. Another is a licensed estate agent is acting for a landlord when a property is for lease, he should complete Form 5 with the landlord.
IncorrectAs state in the Code of Ethics, there are some situations where the appropriate forms are required to be completed such as when a licensed estate agent is acting for a purchaser but the vendor is not represented by an estate agent, Form 1 must be completed. Also, when a licensed estate agent is acting for a vendor, he has to complete Form 3 with the vendor. Another is a licensed estate agent is acting for a landlord when a property is for lease, he should complete Form 5 with the landlord.
- Question 9 of 30
9. Question
What should a licensed estate agent do if he enters into an estate agency agreement in relation to any property?
CorrectIf a licensed estate agent enters into an estate agency agreement for a property that is for sale, he is required to inform the vendor for any offers for the property at all times regardless of the nature of the offer. Also, he should make sure that the client is aware of any benefits such as commissions he gets upon the disposal of the property. If he is acting as both for the vendor and the purchaser, he must as well inform both the clients for such situations.
IncorrectIf a licensed estate agent enters into an estate agency agreement for a property that is for sale, he is required to inform the vendor for any offers for the property at all times regardless of the nature of the offer. Also, he should make sure that the client is aware of any benefits such as commissions he gets upon the disposal of the property. If he is acting as both for the vendor and the purchaser, he must as well inform both the clients for such situations.
- Question 10 of 30
10. Question
Which of the following events that a licensed estate agent may enter into an estate agency agreement with a vendor?
I. When the agreement for the sale and purchase or a lease has not been signed.
II. When the advertisement has not been done.
III. Before the property has been inspected by the purchaser.
IV. Within seven working days after the instruction of the vendor to sell or lease a property.
V. 14 days after the instruction of the vendor to sell or lease a property.CorrectA licensed estate agent may enter into an estate agency agreement with a vendor before the property has been advertised, upon accepting the instruction of the vendor to sell or lease a property within seven working days from such acceptance and before the agreement has been signed for the sale and purchase or a lease of the property.
IncorrectA licensed estate agent may enter into an estate agency agreement with a vendor before the property has been advertised, upon accepting the instruction of the vendor to sell or lease a property within seven working days from such acceptance and before the agreement has been signed for the sale and purchase or a lease of the property.
- Question 11 of 30
11. Question
Which of the following should be stated in the written agreement of a first sale of an undivided share in a land wherein a property forms part by a vendor of the property?
I. Information in Part 1 of Form 1 in the Schedule to the PR must be obtained by the agent unless he is not able to do so may be obtained by the vendor in accordance with the provisions.
II. The vendor shall supply the agent with Part 2 of Form 1 except if the property is a unit in an uncompleted building.
III. The agent shall have full disclosure to the client the beneficial interest he has in the property in the agreement.
IV. The agent shall obtain the information both in Part 1 and Part 2 of Form 1 in the Schedule to PR.
V. All the forms shall be obtained by the vendor.CorrectThe agent must obtain the information in Part 1 of Form 1 in the Schedule to the PR unless there are circumstances that he may not able to do so may be obtained by the vendor but should be in accordance with the provisions. If the property is a unit in an uncompleted building the vendor shall supply the agent with Part 2 of Form 1.
IncorrectThe agent must obtain the information in Part 1 of Form 1 in the Schedule to the PR unless there are circumstances that he may not able to do so may be obtained by the vendor but should be in accordance with the provisions. If the property is a unit in an uncompleted building the vendor shall supply the agent with Part 2 of Form 1.
- Question 12 of 30
12. Question
Which of the following statements should NOT be done by a licensee when seeking instructions?
I. It is a licensee’s responsibility to provide accurate information about a property to a client.
II. Any information of a vendor or his property should not be passed to a sub-listing agent unless prior written consent of the vendor has been acquired.
III. A licensee may submit a property to a sub-listing agent a property if he is able to acquire a verbal consent from the vendor.
IV. A record of all listings of properties and copies of all estate agency agreements must be kept by a licensee for a minimum of one year from the receipt of the listing or upon engaging in such agreements.
V. A licensee may continue to solicit instructions from a vendor even if the property is subject to an exclusive agency granted to another licensed estate agent.CorrectA licensee is demanded to provide only accurate information to a client at all times and not to provide any misleading information in relation to a property. Also, he has to get written consent from the vendor if he wants a property to be included in a sub-listing agent. A licensee as well should not pursue instruction from a vendor if he is aware that the property is under an exclusive agency.
IncorrectA licensee is demanded to provide only accurate information to a client at all times and not to provide any misleading information in relation to a property. Also, he has to get written consent from the vendor if he wants a property to be included in a sub-listing agent. A licensee as well should not pursue instruction from a vendor if he is aware that the property is under an exclusive agency.
- Question 13 of 30
13. Question
What should a licensee do in relation to property inspection and viewing by a purchaser?
I. A licensee should inform the vendor the prepare a written inventory of what is to be included in the sale and purchase or lease of a property.
II. A licensee is responsible for assisting the purchaser in arranging the inspection and viewing.
III. A licensee must accompany the purchaser during inspection and viewing of the purchaser unless the purchaser decides not to be accompanied.
IV. A licensee should provide the purchaser the contact numbers of the vendor so both can arrange for the inspection and viewing themselves.
V. Before arranging for an inspection and viewing of a property, the licensee must get the vendor’s consent.CorrectIf a purchaser is interested to inspect and view a property, a licensee must make the necessary arrangements and must get the approval of the vendor. He has to accompany the purchaser during the inspection except if the purchaser instructed him not to do so. The licensee as well has to prepare the written inventory which states what is included in the sale and purchase or lease of a property.
IncorrectIf a purchaser is interested to inspect and view a property, a licensee must make the necessary arrangements and must get the approval of the vendor. He has to accompany the purchaser during the inspection except if the purchaser instructed him not to do so. The licensee as well has to prepare the written inventory which states what is included in the sale and purchase or lease of a property.
- Question 14 of 30
14. Question
In conducting negotiations, which of the following are expected to be done a licensee in accordance with the Code of Ethics?
I. A licensee must only claim that an offer has been made by a purchaser if it actually exists.
II. A licensee is responsible for the information or comparables on property prices that he provides to the client that these are the correct values of the property.
III. A licensee should filter the offers received and presents only to the client the offers that he finds worthy and beneficial.
IV. When an offer is received, a licensee should present this offer to the client as soon as he can.
V. A license may delay the presentation of an offer to a client if he considers the offer as not a very good offer.CorrectA licensee is expected not to make false claims that he has received an offer. If he did receive an offer, he has to notify the client immediately of such an offer regardless of the nature of the offer. A licensee as well must make sure that information provided to the client such as prices are not misrepresented.
IncorrectA licensee is expected not to make false claims that he has received an offer. If he did receive an offer, he has to notify the client immediately of such an offer regardless of the nature of the offer. A licensee as well must make sure that information provided to the client such as prices are not misrepresented.
- Question 15 of 30
15. Question
A client wishes to enter into an agreement but does not have legal representation, what should be the proper course of actions of a licensee?
I. A licensee should not allow the client to enter into an agreement without legal representation.
II. A licensee must explain to the client all the details of the agreement such as the meaning of any essential terms and provisions.
III. A licensee must not try to explain to the client the details of the agreement and let the legal representative handle the explanation.
IV. A licensee must make it clear to the client that understanding the details of the agreement is the sole responsibility of the client.
V. If the client still has some confusion on any of the part of the agreement, the licensee must recommend seeking legal advice to the client.CorrectIf in a situation wherein the client does not have a legal representative, the licensee must explain to the client all the details stated in the agreement. However, after explaining to the client, the client still has some parts that are not fully understood, the licensee should recommend seeking legal advice.
IncorrectIf in a situation wherein the client does not have a legal representative, the licensee must explain to the client all the details stated in the agreement. However, after explaining to the client, the client still has some parts that are not fully understood, the licensee should recommend seeking legal advice.
- Question 16 of 30
16. Question
A licensee has recommended to a client the services of a particular person. What is the proper thing to do by a licensee in relation to this?
CorrectWhen a licensee recommends a service of a certain individual to a client, the Code of Ethics states that the licensee should inform beforehand the client of all the prospective benefits that he may get because of the recommendation.
IncorrectWhen a licensee recommends a service of a certain individual to a client, the Code of Ethics states that the licensee should inform beforehand the client of all the prospective benefits that he may get because of the recommendation.
- Question 17 of 30
17. Question
A licensed estate agent is required to keep proper accounts of all the money related transactions conducted with clients. What could be a possible event that will happen in relation to this?
CorrectAll licensed estate agents are required to maintain proper accounts of money received or held, or paid by, for, or on account of clients. These accounts may be subjected for inspection by EAA officers which are given authorization in writing.
IncorrectAll licensed estate agents are required to maintain proper accounts of money received or held, or paid by, for, or on account of clients. These accounts may be subjected for inspection by EAA officers which are given authorization in writing.
- Question 18 of 30
18. Question
Which of the following is TRUE about switching of types of license?
CorrectA licensed estate agent is allowed to apply for the grant of a salesperson’s license. On the other hand, a licensed salesperson may apply for the grant of an estate agent’s license only if he has passed an estate agent’s qualifying examination at any time or he has completed an estate agent’s training course on or before 31 December 2001 where is a senior practitioner.
IncorrectA licensed estate agent is allowed to apply for the grant of a salesperson’s license. On the other hand, a licensed salesperson may apply for the grant of an estate agent’s license only if he has passed an estate agent’s qualifying examination at any time or he has completed an estate agent’s training course on or before 31 December 2001 where is a senior practitioner.
- Question 19 of 30
19. Question
Which of the following criteria should an ex-holder of a salesperson’s license meet in order to apply for the grant of an estate agent’s license?
CorrectAn ex-holder of a salesperson’s license may apply for the grant of an estate agent’s license if he applies within the relevant period which is within 24 months or he has completed a training course for estate agents on or before 31 December 2001.
IncorrectAn ex-holder of a salesperson’s license may apply for the grant of an estate agent’s license if he applies within the relevant period which is within 24 months or he has completed a training course for estate agents on or before 31 December 2001.
- Question 20 of 30
20. Question
In events where a licensed estate agent receives money or held money for a client in a trust account, what should a licensed estate agent do?
CorrectWhen a licensed estate agent receives money from a client or he might have held money in a trust fund should deposit this money and must make sure that he has a copy of the deposit slip and keep it for not less than three years after the deposit was made.
IncorrectWhen a licensed estate agent receives money from a client or he might have held money in a trust fund should deposit this money and must make sure that he has a copy of the deposit slip and keep it for not less than three years after the deposit was made.
- Question 21 of 30
21. Question
How should a license estate agent withdraw money from a trust account after receiving instruction from a client to do such?
CorrectIf a licensed estate agent is given an instruction by a client to withdraw money from a trust account, he can withdraw money only by cheque or by an electronic fund transfer.
IncorrectIf a licensed estate agent is given an instruction by a client to withdraw money from a trust account, he can withdraw money only by cheque or by an electronic fund transfer.
- Question 22 of 30
22. Question
If a licensee’s application for the renewal of license has been refused or revoked by EAA, when can a licensee reapply?
CorrectIn instances where due to some reasons, a licensee’s application for renewal of license has been refused or revoked by EAA, a licensee should not apply again after 12 months from the date of refusal or revocation.
IncorrectIn instances where due to some reasons, a licensee’s application for renewal of license has been refused or revoked by EAA, a licensee should not apply again after 12 months from the date of refusal or revocation.
- Question 23 of 30
23. Question
What is the proper action by a licensee when he ceased to be engaged in estate agency work?
CorrectA licensee is required to complete Form 8 in the Schedule to the PR as a notification to the EAA when stopping to be engaged in estate agency work.
IncorrectA licensee is required to complete Form 8 in the Schedule to the PR as a notification to the EAA when stopping to be engaged in estate agency work.
- Question 24 of 30
24. Question
Sam is a licensed estate agent and is now subjected to an inquiry or investigation by EAA in relation to his estate agency work. What should Sam do in this kind of situation?
CorrectAll licensees may be subjected to an inquiry or investigation by the EAA given due causes. During this time, the licensee must be fully cooperative and provide the EAA with accurate and not misleading statements.
IncorrectAll licensees may be subjected to an inquiry or investigation by the EAA given due causes. During this time, the licensee must be fully cooperative and provide the EAA with accurate and not misleading statements.
- Question 25 of 30
25. Question
When should a licensee apply for a renewal of licensee?
CorrectLicensees may apply for renewal of license for not more than three months and not less than one month before the license will expire. Except if a prior written consent from EAA for a shorter period has been made.
IncorrectLicensees may apply for renewal of license for not more than three months and not less than one month before the license will expire. Except if a prior written consent from EAA for a shorter period has been made.
- Question 26 of 30
26. Question
Which of the following must be included in the advertisement by a licensed estate agent or on his behalf?
CorrectA license estate agent should include in all its documents such as receipts, brochures, etc, and in advertisements the license number or statement of particulars of business, business name, and the location of the business. The location of the business is not required if the advertisement in non-brochure and pamphlet form.
IncorrectA license estate agent should include in all its documents such as receipts, brochures, etc, and in advertisements the license number or statement of particulars of business, business name, and the location of the business. The location of the business is not required if the advertisement in non-brochure and pamphlet form.
- Question 27 of 30
27. Question
What should a licensed estate agent do upon engaging to be a partner of a partnership engaged in estate agency work or ceasing such engagement?
CorrectA licensed estate agent should complete Form 12 in the Schedule of the PR within 31 days upon engaging to be a partner of a partnership engaged in estate agency work or ceasing such engagement.
IncorrectA licensed estate agent should complete Form 12 in the Schedule of the PR within 31 days upon engaging to be a partner of a partnership engaged in estate agency work or ceasing such engagement.
- Question 28 of 30
28. Question
Which of the following situations where no form is prescribed for the purposes of the EAO?
CorrectNo forms prescribed for the purposes of the EAO when the property for sale and purchase or lease is a car parking space. If the property for lease is not a self-contained unit and in the first sale of an undivided share in land which a part of it is residential.
IncorrectNo forms prescribed for the purposes of the EAO when the property for sale and purchase or lease is a car parking space. If the property for lease is not a self-contained unit and in the first sale of an undivided share in land which a part of it is residential.
- Question 29 of 30
29. Question
What should a licensed estate agent conducting the business of estate agency work do upon the appointment of a manager?
CorrectWhen a licensed estate agent conducting the business of estate agency work appoints a manager, he is required to notify EAA within 31 days of appointment by completing Form 10 in the Schedule of the PR.
IncorrectWhen a licensed estate agent conducting the business of estate agency work appoints a manager, he is required to notify EAA within 31 days of appointment by completing Form 10 in the Schedule of the PR.
- Question 30 of 30
30. Question
What are the qualifications of a director of a company holding an estate agent’s license must possess?
CorrectCompanies holding an estate agent’s license are required to have at least one director who has a valid license and must comply with section 20(3) of the EAO, that is he has to be fit and proper at the time of appointment as director.
IncorrectCompanies holding an estate agent’s license are required to have at least one director who has a valid license and must comply with section 20(3) of the EAO, that is he has to be fit and proper at the time of appointment as director.
