PM / CHAPTER 2 / Part 1 The Real Estate Services Act

Question 1

The purpose of the Real Estate Services Act is to protect the public by . . . [List 3]

Answer 1

[1] setting minimum reasonable competency

[2] setting standards of conduct

[3] creating the Real Estate Council of British Columbia which administers the Act

Question 2

A purchaser may rescind the purchase agreement by serving written notice of the rescission on the developer within _____ days

Answer 2

ANSWER: SEVEN

Question 3

Real estate services is defined by the Act as . . . [List 3]

Answer 3

[1] rental property management services,

[2] strata management services, or

[3] trading services.

Question 4

True or False?

Showing real estate is considered a “Trading Service”?

Answer 4

Answer: True

Question 5

True or False?

Receiving deposit money paid in respect of the real estate is considered a “Trading Service”

Answer 5

Answer: True

Question 6

Complete the Sentence

The _ _ _ _ is authorized to suspend or cancel a licence.

Answer 6

Answer:

The Real Estate Council is authorized to suspend or cancel a licence.

Question 7

True or False

Collecting rents or security deposits for the use of the real estate is a “Trading Service”?

Answer 7

Answer: False

Collecting rents is a Rental Management Service, requiring a license.

Question 8

Complete the Sentence

Employees of the _____ to a real estate transaction are permitted to conduct Real Estate Services without having to obtain a license?

Answer 8

Answer: Principal

Question 9

True or False?

Individuals who provide appraisals, or property inspections are required to obtain the an Appraisal License?

Answer 9

Answer: False

Note: There is no licensing requirements for appraisers or property inspectors.

Question 10

Is the construction of a commercial office building considered a real estate service?

Answer 10

**Answer:

No**

Question 11

True or False?

A practising lawyer, in respect of real estate services provided in the course of the person’s practice is exempt from the requirements of the Real Estate Services Act?

Answer 11

Answer: True

Question 12

True or False?

An unlicensed assistant may host an open house?

Answer 12

Answer: False

Hosting an open house requires a license.

Question 13

**True or False?

An unlicensed assistant may renew a listing contract on behalf of the agent.**

Answer 13

**Answer: False

That activity requires a license.**

Question 14

**True or False?

An unlicensed assistant may unlock a property to let prospective buyers enter.**

Answer 14

Answer: True

Question 15

**True or False?

An unlicensed assistant may witness signatures?**

Answer 15

Answer: True

Question 16

QUICK NOTE / Section 5-6 of RESA prohibits licensees from making a PROMISE to acquire, or resell or otherwise dispose of, the real estate or any other real estate;

UNLESS at the time the licensee makes the promise, he or she gives a signed statement containing the details of the promise to the person to whom it is made, and including the signature of any other party involved in the promise.

Answer 16

QUICK NOTE / Section 5-6 of RESA prohibits licensees from making a PROMISE to acquire, or resell or otherwise dispose of, the real estate or any other real estate;

UNLESS at the time the licensee makes the promise, he or she gives a signed statement containing the details of the promise to the person to whom it is made, and including the signature of any other party involved in the promise.

Question 17

List the 3 objectives of the Real Estate Council?

Answer 17

[1] Administering the Real Estate Services Act

[2] Advancing competency of licensees

[3] Protecting the public interest in relation to the conduct and integrity of its licensees.

Question 18

**Complete the Sentence:

The _ _ _ _ is responsible for issuing and renewing all licences under the Real Estate Services Act.**

Answer 18

Answer:

The Real Estate Council is responsible for issuing and renewing all licences under the Real Estate Services Act.

Question 19

**Complete the Sentence:

The Real Estate Council is made up of __ (#) members, __ (#) of whom are elected by licensees and __ (#) members who are appointed by the Lieutenant Governor in Council**

Answer 19

**Answer:

The Real Estate Council is made up of 16 members, 13 of whom are elected by licensees and three members who are appointed by the Lieutenant Governor in Council**

Question 20

**Complete the Sentence

The _____ receives the interest payable on all brokerage trust accounts held in savings institutions except separate trust accounts maintained for specific clients.​**

Answer 20

**Answer:

The Real Estate Foundation receives the interest payable on all brokerage trust accounts held in savings institutions except separate trust accounts maintained for specific clients.**

Question 21

**Complete the Sentence

The pupose of the ______ is to carry out professional education, real estate law reform, and real estate research**

Answer 21

**Answer:

Real Estate Foundation**

Question 22

**Complete the Sentence

The _____ Corporation was created as an affordable method of protecting licensees from financial loss due to errors and omissions.**

Answer 22

**Answer:

The E&O Insurance Corporation was created as an affordable method of protecting licensees from financial loss due to errors and omissions.**

Question 23

**True or False

Errors and Omissions Insurance is compulsory?**

Answer 23

Answer: True

Question 24

**This organization:

[1] Is NOT created by the Real Estate Services Act
[2] Represents the interests of real estate boards and Realtors,
[3] Develops continuing education courses.**

Answer 24

**Answer:

The British Columbia Real Estate Association (BCREA).**

Question 25

**Complete the Sentence

A _ _ _ _is a licensee on behalf of which other licensees must provide real estate services.**

Answer 25

**Answer:

A brokerage is a licensee on behalf of which other licensees must provide real estate services.**

Question 26

**Complete the Sentence

A brokerage must have a _ _ _ .**

Answer 26

**Answer:

A brokerage must have a managing broker**

Question 27

Complete the Sentence:

A brokerage may only provide real estate services that are permitted by _ _ _ .

Answer 27

**Answer:

A brokerage may only provide real estate services that are permitted by the licence of a managing broker who is licensed to the brokerage.**

Question 28

**True or False?

Generally, a managing broker may only be licensed in relation to one brokerage?**

Answer 28

Answer: True

Question 29

Complete the Sentence:

The real estate services that a _ _ _ _ is permitted to provide determine the real estate services that the _ _ _ that employs the managing broker may provide.

Answer 29

Answer:

The real estate services that a MANAGING BROKER is permitted to provide determine the real estate services that the BROKERAGE that employs the managing broker may provide.

Question 30

**A brokerage must, within 120 days after the end of each fiscal year of the brokerage, file with the Council:

[List 3]**

Answer 30

[1] financial statements

[2] accountant’s report

[3] brokerage activity report.

Question 31

**True or False?

The licensee must not enter into an agency relationship unless he or she can render a skilled and conscientious service to the principal.**

Answer 31

**Answer:

True**

Question 32

**Notes / Real Estate Services Act / Rule 5-10

The licensee must make clear for which party he or she is acting and not receive compensation from more than one party except with the full knowledge and consent of all parties to the transaction.**

Answer 32

**Notes / Real Estate Services Act / Rule 5-10

The licensee must make clear for which party he or she is acting and not receive compensation from more than one party except with the full knowledge and consent of all parties to the transaction.**

Question 33

What must happen when a signed acceptance of an offer is received by a licensee?

Answer 33

As soon as a licensee has obtained a signed acceptance of an offer to acquire or dispose of real estate, he or she must promptly deliver a copy of this signed acceptance to each of the parties to the trade in real estate, as well as to the related brokerage of the licensee.

Question 34

**TRUE OR FALSE?

When applying for a managing broker’s license, the applicant must submit his/her personal financial statements.**

Answer 34

**Answer: That statement is false.
When applying for a managing broker license, the applicant will need to have achieved the required educational and experience requirements.

There is NO requirement to submit financial statements for a managing broker’s license.**

Question 35

**True or False

The Real Estate Council collects premiums on behalf of the Real Estate Errors and Insurance Corporation?**

Answer 35

Answer: True

Question 36

**Complete the Sentence

A licensee must not ____ any party to an agreement for a trade in real estate to break the agreement for the purpose of entering into an agreement with another party.**

Answer 36

**Answer:

A licensee must not INDUCE any party to an agreement for a trade in real estate to break the agreement for the purpose of entering into an agreement with another party.**

Question 37

**True or False?

The Real Estate Council is made up of civil servants from the Government of BC?**

Answer 37

**Answer:

False.

The Real Estate Council is made up of licensees, brokers and lay people.**

Question 38

**True or False?

To qualify for a managing broker’s license in BC a person must have three years of licensed experience in BC?**

Answer 38

**Answer:

That statement is FALSE.

Previous experience in B.C. - In order for an individual to be licensed for the first time as a managing broker or associate broker, the applicant must have been providing real estate services as a licensee for at least TWO YEARS during the 5 years before the date of the application.**

Question 39

QUICK NOTE / In order to be licensed for the first time as a MANAGING BROKER or ASSOCIATE BROKER, the licensee must have been providing real estate services as a licensee in a Canadian province or Yukon for at least TWO YEARS during the five years before the date of the application.

Answer 39

QUICK NOTE / In order to be licensed for the first time as a MANAGING BROKER or ASSOCIATE BROKER, the licensee must have been providing real estate services as a licensee in a Canadian province or Yukon for at least TWO YEARS during the five years before the date of the application.

Question 40

**True or False?

To qualify for a managing broker’s license the applicant must be at least 18.**

Answer 40

**Answer: FALSE

The applicant must be at least 19 years old.

Please note other requirements:

[1] The applicant must be of good reputation.
[2] Applicants must meet the educational and experience requirements.**

Question 41

Constructing a commercial office is considered a “real estate service”

Answer 41

ANSWER: FALSE

Question 42

This is the unmaking, or an undoing of the contract from the beginning, as opposed to a termination.

Answer 42

ANSWER: RECISSION

Question 43

QUICK NOTE / A purchaser may rescind the purchase agreement by serving written notice of the rescission on the developer within seven days after the later of:

1. the date that the purchase agreement was made; or

2. the date that the developer obtained a written statement from the purchaser, acknowledging that the purchaser has had an opportunity to read the disclosure statement.

Answer 43

QUICK NOTE / A purchaser may rescind the purchase agreement by serving written notice of the rescission on the developer within seven days after the later of:

1. the date that the purchase agreement was made; or

2. the date that the developer obtained a written statement from the purchaser, acknowledging that the purchaser has had an opportunity to read the disclosure statement.

Question 44

QUICK NOTE / Development property means any of the following:
5 or more subdivision lots in a subdivision
5 or more bare land strata lots
5 or more strata lots in a stratified building;

Answer 44

QUICK NOTE / Development property means any of the following:
5 or more subdivision lots in a subdivision
5 or more bare land strata lots
5 or more strata lots in a stratified building;

Question 45

QUICK NOTE / Development property means any of the following:

2 or more cooperative interests
5 or more time share interests
2 or more shared interests in land in the same parcel or parcels of land; or
5 or more leasehold units

Answer 45

QUICK NOTE / Development property means any of the following:

2 or more cooperative interests
5 or more time share interests
2 or more shared interests in land in the same parcel or parcels of land; or
5 or more leasehold units

Question 46

TRUE OR FALSE? A developer who markets a development property in a single transaction is exempt from the marketing requirements

Answer 46

ANSWER: TRUE

Question 47

COMPLETE THE SENTENCE / A “development unit” is defined in REDMA to mean _ _ _ _ _ _

Answer 47

ANSWER / A “development unit” is defined in REDMA to mean a subdivision lot, bare land strata lot, strata lot, cooperative interest, time share interest, a shared interest in land or a leasehold unit, provided they are located in a development property.

Question 48

TRUE OR FALSE? The Real Estate Council is made up of the BC Real Estate Boards?

Answer 48

ANSWER: FALSE

Question 49

TRUE OR FALSE? The Real Estate Council may discipline a licensee by suspending the licensee from the Multiple Listing Service.

Answer 49

ANSWER: FALSE

Question 50

FILL IN THE BLANK: The _________________ can refuse to issue or renew a licence. If the Council determines that the licensee is not suitable to be licensed

Answer 50

ANSWER: THE REAL ESTATE COUNCIL

Question 51

QUICK NOTE / The best example of a “stakeholder” is a person who holds money until the outcome of a bet is known. Such a person does not hold it on behalf of one of the parties - a stakeholder is the “middleman”.

Answer 51

QUICK NOTE / The best example of a “stakeholder” is a person who holds money until the outcome of a bet is known. Such a person does not hold it on behalf of one of the parties - a stakeholder is the “middleman”.

Question 52

QUICK NOTE /

Because the brokerage holds the deposit as a stakeholder, a seller cannot successfully demand payment of the deposit to him or her before the transaction is completed, nor can a buyer successfully demand the return of the deposit if he or she does not want to proceed with the transaction.

Answer 52

QUICK NOTE /

Because the brokerage holds the deposit as a stakeholder, a seller cannot successfully demand payment of the deposit to him or her before the transaction is completed, nor can a buyer successfully demand the return of the deposit if he or she does not want to proceed with the transaction.​