A salesperson licensed 4 months ago has found a buyer for a listing and wants to draft the sale and purchase agreement herself. What does REA's supervision guidance say?
Correct Answer
B) She cannot prepare it until she has 6 months' experience; her supervisor must.
REA's supervision guidance explains that under the Lawyers and Conveyancers Act 2006 a salesperson with less than 6 months' real estate agency work experience cannot prepare sale and purchase agreements or advise on legal rights and obligations incidental to them. The supervisor must prepare the agreement and give that advice.
Why This Is the Correct Answer
REA says the 6-month restriction means the supervisor prepares the agreement.
Why the Other Options Are Wrong
Option A: She may prepare it if her supervisor signs it first.
Under the Lawyers and Conveyancers Act, salespersons with under 6 months' experience cannot prepare these agreements.
Option C: She may prepare it, since any licensed salesperson may draft sale and purchase agreements.
REA says newly licensed salespersons cannot prepare agreements or advise on them in their first 6 months.
Option D: She may prepare it if she has previously worked as a property manager for over a year.
REA says property management or assistant experience does not count toward the 6 months.
Background Knowledge for Agency Practice
Source: https://www.rea.govt.nz/real-estate-professionals/obligations/supervision/
Exam Tip for Agency Practice
First 6 months: new salespersons can list, appraise and run open homes, but not draft agreements.
Common Mistakes to Avoid on Agency Practice Questions
- •Assuming a supervisor's sign-off lets a brand-new salesperson draft the agreement.
More Agency Practice Questions
A real estate agent receives two offers on a property at the same time. What is their primary obligation?
Which of the following situations would create a conflict of interest requiring disclosure by a real estate licensee?
Sarah is a licensed salesperson working for ABC Real Estate. When showing a property to buyers, who does she primarily represent?
Under the Real Estate Agents Act 2008, what is the primary duty that a real estate agent owes to their client?
Which licence allows a person to carry out real estate agency work for an agent, but only under supervision?
- → Under section 126 of the Real Estate Agents Act 2008, what must happen after the client signs an agency agreement for the agent to be entitled to commission?
- → A licensed agent discovers that their salesperson has been providing advice about tax implications of a property investment without appropriate qualifications. What is the agent's responsibility?
- → An agency agreement contains a clause stating that the agent's commission is payable even if the property is sold by the vendor directly to a buyer introduced by the agent during the agency period, but the sale settles after the agency expires. Is this clause enforceable?
- → What must a real estate agent disclose to a potential purchaser when showing a property?
- → Under a sole agency agreement, when is the vendor still liable to pay commission to the agent?
- → Sarah holds a salesperson's licence and works for ABC Real Estate. When presenting an offer to a vendor, who is legally responsible for ensuring all disclosure obligations are met?
- → A real estate agent discovers that a property has a leaky roof after the agency agreement is signed but before any offers are received. What is the agent's obligation?
- → Which of the following allows an agent to end an agency agreement before its expiry date?
- → Under the Real Estate Agents Act 2008, what is the primary fiduciary duty that a real estate agent owes to their client?
- → What must a licensee do when they become aware of a material defect in a property they are marketing?
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