An unlicensed property manager finds tenants for residential houses and also negotiates a new lease of a retail shop for a client. Which activity needs a licence under the Real Estate Agents Act 2008?
Correct Answer
D) Only the retail shop lease; residential tenancies are excluded from 'transaction'.
Under s 4 of the Real Estate Agents Act 2008, real estate agency work means work done for another to bring about a transaction. 'Transaction' includes granting a leasehold interest in land 'other than a tenancy to which the Residential Tenancies Act 1986 applies'. Arranging residential tenancies is therefore not licensed work, but arranging a commercial lease is.
Why This Is the Correct Answer
Section 4 excludes RTA tenancies from 'transaction' but includes commercial leases.
Why the Other Options Are Wrong
Option A: Both, because all leasing of land for reward is real estate agency work.
Section 4 excludes tenancies under the Residential Tenancies Act 1986 from 'transaction'.
Option B: Only the residential lettings, because commercial leases fall outside the Act.
A leasehold interest outside the RTA, such as a shop lease, is a transaction.
Option C: Neither, because leasing work is never real estate agency work.
Commercial leases are leasehold interests within s 4, so arranging one is agency work.
Background Knowledge for Property Management
Source: https://www.legislation.govt.nz/act/public/2008/0066/latest/whole.html
Exam Tip for Property Management
Residential letting is unlicensed; commercial leasing is agency work.
Common Mistakes to Avoid on Property Management Questions
- •Assuming property management of homes is automatically licensed work.
More Property Management Questions
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- → Which of the following is NOT a mandatory requirement for tenancy agreements under the Residential Tenancies Act?
- → How much notice must a landlord give a tenant before conducting a routine property inspection?
- → A tenant has given 21 days' notice to terminate a periodic tenancy but wants to leave 5 days early. What must happen for this to be legally acceptable?
- → A tenant claims bond refund for $1,200 but the landlord disputes $400 for carpet cleaning. The tenant disagrees and applies to the Tenancy Tribunal. What happens to the bond during this dispute?
- → How often may a landlord carry out routine inspections during a tenancy?
- → A landlord wants to increase rent for a periodic tenancy. What is the minimum notice period they must give?
- → During a property inspection, a property manager discovers the tenant has installed a spa pool without permission. What is the most appropriate first step?
- → By what date did all private rental properties in New Zealand have to comply with the healthy homes standards?
- → A property manager conducts an inspection and finds the tenant has installed a heat pump without permission. The tenancy agreement prohibits alterations without consent. What can the landlord legally require?
- → During a property inspection, a landlord notices the tenant has changed the locks. Under what circumstances is this legally permitted?
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