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Hong Kong Salespersons Qualifying Examination (SQE) study materials
Hong Kong Salespersons Qualifying Examination (SQE) study resources

Hong Kong Salespersons Qualifying Examination (SQE) practice questions

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First 50 of 190 questions. Each one lists the choices, the correct answer, and an explanation. The checker at the top of this page saves progress in this browser when it is available.

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Question 1Hong Kong estate agency practice

Which Hong Kong ordinance is the principal legislation governing the licensing and conduct of estate agents and salespersons?

  1. The Conveyancing and Property Ordinance
  2. The Estate Agents Ordinance (Cap. 511) Correct answer.
  3. The Landlord and Tenant (Consolidation) Ordinance
  4. The Building Management Ordinance

Explanation

The Estate Agents Ordinance (Cap. 511) is the principal legislation that established the Estate Agents Authority and provides for the licensing, regulation and discipline of estate agents and salespersons in Hong Kong.

Question 2Hong Kong estate agency practice

Which statutory body is responsible for regulating the estate agency trade and issuing licences in Hong Kong?

  1. The Estate Agents Authority (EAA) Correct answer.
  2. The Hong Kong Monetary Authority
  3. The Securities and Futures Commission
  4. The Lands Department

Explanation

The Estate Agents Authority (EAA) is the statutory body established under the Estate Agents Ordinance to regulate the trade, issue licences and discipline practitioners.

Question 3Hong Kong estate agency practice

A person who negotiates property transactions on behalf of a licensed estate agency company, but is not authorised to operate the business, requires which type of licence?

  1. An estate agent's (company) licence
  2. An estate agent's (individual) licence
  3. A salesperson's licence Correct answer.
  4. No licence is required

Explanation

A salesperson's licence authorises the holder to carry out estate agency work for a licensed estate agent or company, but not to operate or be in charge of the business. The SQE qualifies a candidate for this licence.

Question 4Hong Kong estate agency practice

Before granting a licence, the Estate Agents Authority must be satisfied that the applicant is a:

  1. Hong Kong permanent resident
  2. Fit and proper person Correct answer.
  3. Member of a property trade association
  4. University graduate

Explanation

The Estate Agents Ordinance requires that an applicant be a fit and proper person to hold a licence. The EAA considers matters such as honesty, financial integrity and any criminal or disciplinary record.

Question 5Hong Kong estate agency practice

When assessing whether an applicant is a fit and proper person, the EAA may take into account whether the applicant has been:

  1. Convicted of an offence involving dishonesty Correct answer.
  2. Born in Hong Kong
  3. Employed for at least five years
  4. A registered voter

Explanation

A conviction for an offence involving fraud, dishonesty or bankruptcy is directly relevant to the fit-and-proper test, because it bears on the applicant's integrity in handling clients' money and information.

Question 6Hong Kong estate agency practice

A salesperson's licence issued by the EAA is normally valid for what period before it must be renewed?

  1. One year
  2. Two years Correct answer.
  3. Three years
  4. Five years

Explanation

Estate agent and salesperson licences in Hong Kong are normally issued for a period of two years and must be renewed before they expire to allow the holder to continue carrying out estate agency work.

Question 7Hong Kong estate agency practice

If a licensed salesperson changes the estate agency company they work for, they must:

  1. Sit the SQE again
  2. Notify the EAA of the change within the prescribed time Correct answer.
  3. Surrender the licence permanently
  4. Apply for an estate agent's licence

Explanation

A salesperson must notify the EAA of any change in the agency they are attached to within the period prescribed in the Ordinance, so that the register of licensees remains accurate.

Question 8Hong Kong estate agency practice

Carrying out estate agency work in Hong Kong without holding a valid licence is:

  1. Permitted if supervised by a licensee
  2. An offence under the Estate Agents Ordinance Correct answer.
  3. Allowed for commercial property only
  4. A purely civil matter with no penalty

Explanation

It is a criminal offence under the Estate Agents Ordinance for a person to carry out estate agency work without a valid licence. On conviction the person is liable to a fine and imprisonment.

Question 9Hong Kong estate agency practice

Which of the following is a function of the Estate Agents Authority under the Ordinance?

  1. Setting interest rates for mortgages
  2. Promoting integrity and competence among practitioners Correct answer.
  3. Approving building plans
  4. Collecting stamp duty

Explanation

Among its statutory functions, the EAA promotes integrity, competence and professionalism among estate agency practitioners, regulates their practice and protects the interests of consumers.

Question 10Hong Kong estate agency practice

A statement of particulars of business (SPB) submitted to the EAA records information about:

  1. A client's personal income
  2. The estate agency company and its principal place of business Correct answer.
  3. The price of every property listed
  4. The applicant's examination results

Explanation

A statement of particulars of business sets out details of the estate agency company, including its name, principal and branch places of business and the persons in charge, so the EAA and the public know who is operating the firm.

Question 11Hong Kong estate agency practice

If a licensee is convicted of a serious criminal offence after a licence is granted, the EAA may:

  1. Do nothing because the licence is already granted
  2. Take disciplinary action and review the licence Correct answer.
  3. Automatically extend the licence
  4. Refund the licence fee

Explanation

A subsequent conviction can affect whether the holder remains a fit and proper person, so the EAA may take disciplinary action and review, suspend or revoke the licence even after it has been granted.

Question 12Hong Kong estate agency practice

Which of the following best describes 'estate agency work' under the Ordinance?

  1. Only the drafting of formal sale and purchase agreements by solicitors
  2. Acting as agent in the sale, purchase or lease of property for a fee or reward Correct answer.
  3. Constructing or renovating buildings
  4. Valuing land for the government

Explanation

Estate agency work means doing any act in the course of business for another person, for a fee or reward, in connection with introducing or negotiating the sale, purchase or lease of property. This is the activity that requires a licence.

Question 13Hong Kong estate agency practice

A salesperson must display their licence in which manner while working?

  1. Keep it locked in a drawer at all times
  2. Produce it for inspection when carrying out estate agency work Correct answer.
  3. Publish it in a newspaper
  4. Surrender it to the client

Explanation

A licensee must carry the licence and produce it for inspection on request when carrying out estate agency work, so clients and the EAA can confirm the person is properly licensed.

Question 14Hong Kong estate agency practice

The Estate Agents Authority is governed by a board whose members are appointed by:

  1. The Chief Executive of Hong Kong Correct answer.
  2. The estate agency companies themselves
  3. The Legislative Council by election
  4. Property buyers

Explanation

The members of the Estate Agents Authority board are appointed by the Chief Executive of the Hong Kong Special Administrative Region, ensuring the regulator is independent of the trade it supervises.

Question 15Hong Kong estate agency practice

A salesperson is approached by a friend to help sell a flat in return for a share of the commission, but the salesperson's licence has lapsed. What should the salesperson do?

  1. Proceed because it is only one transaction
  2. Decline until the licence is renewed and valid Correct answer.
  3. Use a colleague's licence number
  4. Ask the friend to keep it confidential

Explanation

Carrying out estate agency work without a valid licence is an offence regardless of how many transactions are involved. The salesperson must renew the licence and ensure it is valid before doing any estate agency work.

Question 16Hong Kong estate agency practice

The register of licensees maintained by the EAA is:

  1. Confidential and never disclosed
  2. Open to public inspection Correct answer.
  3. Available only to banks
  4. Destroyed every year

Explanation

The EAA maintains a register of licensed estate agents and salespersons that is open to public inspection, allowing consumers to verify that a person they deal with holds a valid licence.

Question 17Hong Kong estate agency practice

Which document sets out the standards of conduct expected of licensees and is issued by the EAA?

  1. The Code of Ethics Correct answer.
  2. The deed of mutual covenant
  3. The occupation permit
  4. The land grant

Explanation

The EAA issues a Code of Ethics setting out the standards of honesty, fairness and professional conduct expected of licensees. Breaching the code can lead to disciplinary action.

Question 18Hong Kong estate agency practice

An estate agency company must have at least how many licensed estate agents (individual) to operate lawfully?

  1. None; salespersons alone are sufficient
  2. At least one licensed estate agent (individual) Correct answer.
  3. At least ten
  4. Exactly five

Explanation

An estate agency company must have at least one licensed estate agent (individual) responsible for the proper conduct of the business; salespersons must work under the supervision of a licensed estate agent.

Question 19Hong Kong estate agency practice

If the EAA proposes to revoke a licensee's licence on disciplinary grounds, the licensee is generally entitled to:

  1. No say in the matter
  2. An opportunity to make representations before a decision Correct answer.
  3. An automatic appeal to the Chief Executive
  4. Immediate compensation

Explanation

Procedural fairness requires that a licensee facing disciplinary action be given notice and an opportunity to make representations before the EAA reaches a decision, with a right of appeal to the Appeal Panel.

Question 20Hong Kong estate agency practice

A licensee who is declared bankrupt should be aware that bankruptcy may:

  1. Have no effect on the licence
  2. Affect whether they remain a fit and proper person to hold a licence Correct answer.
  3. Automatically double the licence period
  4. Convert the licence to a company licence

Explanation

Bankruptcy is relevant to financial integrity and may affect whether the holder remains a fit and proper person, so the licensee should disclose it to the EAA, which may review the licence.

Question 21Hong Kong estate agency practice

Which of the following persons must hold a licence to carry out estate agency work?

  1. A solicitor preparing a conveyance for a fixed legal fee
  2. A salesperson negotiating a flat sale for commission Correct answer.
  3. A bank valuer assessing a mortgage
  4. A surveyor measuring a building

Explanation

A person who negotiates the sale of a flat for another and earns commission is doing estate agency work and must hold a licence. The other roles are separate professional activities that fall outside estate agency work.

Question 22Hong Kong estate agency practice

The body that hears appeals against decisions of the Estate Agents Authority is the:

  1. District Court
  2. Estate Agents Appeal Panel Correct answer.
  3. Town Planning Board
  4. Small Claims Tribunal

Explanation

The Estate Agents Ordinance establishes an Appeal Panel to hear appeals against specified decisions of the EAA, such as refusal, suspension or revocation of a licence, providing an independent review mechanism.

Question 23Hong Kong estate agency practice

The SQE scope is generally narrower than the EAQE because the SQE excludes the more advanced material on:

  1. The basic licensing requirements
  2. Business operation and management of an estate agency Correct answer.
  3. The code of ethics
  4. Simple agency relationships

Explanation

Because the SQE leads only to a salesperson's licence, it focuses on front-line practice and excludes the more advanced material on operating and managing an estate agency business, which the EAQE covers for prospective estate agents.

Question 24Hong Kong estate agency practice

The subsidiary legislation that sets out the general duties of licensees and special rules for Hong Kong residential properties is the:

  1. Estate Agents Practice (General Duties and Hong Kong Residential Properties) Regulation Correct answer.
  2. Conveyancing and Property Ordinance
  3. Sale of Goods Ordinance
  4. Companies Ordinance

Explanation

The Estate Agents Practice (General Duties and Hong Kong Residential Properties) Regulation is the Practice Regulation made under the Ordinance. It prescribes general duties to clients and customers and special requirements for residential property transactions.

Question 25Hong Kong estate agency practice

Under the Practice Regulation, an estate agent who agrees to act for a vendor must enter into which document with the vendor?

  1. A provisional agreement for sale and purchase
  2. An estate agency agreement Correct answer.
  3. A deed of mutual covenant
  4. A tenancy agreement

Explanation

Before or at the time of acting, the agent must enter into an estate agency agreement with the client setting out the terms of the appointment, including the commission and duration. For residential property this is a prescribed form.

Question 26Hong Kong estate agency practice

For the sale of residential property, the prescribed estate agency agreement signed with the vendor is commonly known as:

  1. Form 1
  2. Form 3 Correct answer.
  3. Form 5
  4. Form 6

Explanation

Form 3 is the prescribed estate agency agreement for the sale of residential property (vendor's side). Form 1 covers letting and Form 5 covers the purchaser's appointment, so it is important to use the correct form.

Question 27Hong Kong estate agency practice

Which prescribed form is the estate agency agreement used when the agent acts for a purchaser of residential property?

  1. Form 2
  2. Form 4
  3. Form 5 Correct answer.
  4. Form 1

Explanation

Form 5 is the prescribed estate agency agreement between an estate agent and a purchaser for the purchase of residential property, setting out the agent's appointment and commission on the buyer's side.

Question 28Hong Kong estate agency practice

Before a client signs an estate agency agreement for residential property, the agent must provide the client with:

  1. A copy of the agent's bank statement
  2. The property information form and explain the agreement Correct answer.
  3. A blank cheque
  4. The agent's tax return

Explanation

The Practice Regulation requires the agent to furnish the client with the prescribed property information form and explain the contents and effect of the estate agency agreement before the client signs it, so the client gives informed consent.

Question 29Hong Kong estate agency practice

An estate agency agreement for residential property must specify the rate or amount of commission and:

  1. The agent's home address
  2. The validity period of the agreement Correct answer.
  3. The colour of the property
  4. The agent's date of birth

Explanation

The prescribed estate agency agreement must state the commission and the period during which it is valid, among other particulars, so both parties know the duration of the appointment and what is payable.

Question 30Hong Kong estate agency practice

Under the Practice Regulation, a licensee owes a duty to act honestly, faithfully and competently and to:

  1. Maximise commission at any cost
  2. Avoid conflicts of interest and disclose them Correct answer.
  3. Withhold information from customers
  4. Favour the party offering the higher price only

Explanation

Licensees must act with due skill, care and diligence, avoid conflicts of interest and disclose any material conflict to the parties. This protects clients and customers and maintains confidence in the trade.

Question 31Hong Kong estate agency practice

If a salesperson is personally interested in buying a property they have listed for a vendor, they must:

  1. Keep their interest secret to get a better deal
  2. Disclose the interest to the vendor in writing Correct answer.
  3. Cancel the vendor's listing without telling them
  4. Buy it through a relative to avoid disclosure

Explanation

A personal interest in a transaction is a material conflict of interest. The licensee must disclose it to the client in writing and obtain consent, ensuring the client can make an informed decision.

Question 32Hong Kong estate agency practice

When an estate agency company holds clients' money, such as a deposit, the money should be:

  1. Mixed with the company's own operating account
  2. Kept in a designated clients' account separate from the firm's money Correct answer.
  3. Spent on office expenses if cash flow is tight
  4. Held in the salesperson's personal account

Explanation

Clients' money must be kept separate from the firm's own funds, typically in a designated clients' account, and handled in accordance with the Practice Regulation to protect it and ensure proper accounting.

Question 33Hong Kong estate agency practice

A licensee who receives a deposit on behalf of a client should issue the payer with:

  1. No documentation at all
  2. A receipt recording the amount and purpose Correct answer.
  3. A personal IOU note
  4. A verbal acknowledgement only

Explanation

Good practice and the Practice Regulation require that a receipt be issued when money is received, recording the amount, date and purpose, so there is a clear and auditable record of the transaction.

Question 34Hong Kong estate agency practice

Property advertisements published by a licensee must be:

  1. Exaggerated to attract buyers
  2. Accurate and not misleading Correct answer.
  3. Anonymous with no licence number
  4. Limited to the asking price only

Explanation

The code of ethics and Practice Regulation require that advertisements be accurate and not false or misleading, and that they identify the licensed agency, so the public is not deceived.

Question 35Hong Kong estate agency practice

Under the code of ethics, a licensee acting for both the vendor and the purchaser in the same transaction (dual agency) must:

  1. Conceal the dual role from both parties
  2. Disclose the dual agency and obtain the consent of both parties Correct answer.
  3. Charge double commission without telling anyone
  4. Only act for the party who pays first

Explanation

Dual agency creates an inherent conflict of interest. The licensee must disclose the dual role to both parties and obtain their informed consent, acting fairly and impartially between them.

Question 36Hong Kong estate agency practice

A licensee must keep records of transactions and produce them when required by:

  1. The competing agency next door
  2. The Estate Agents Authority Correct answer.
  3. Any member of the public on demand
  4. The property's previous owner

Explanation

Licensees must keep proper records of estate agency transactions and produce them to the EAA on request, enabling the Authority to supervise compliance and investigate complaints.

Question 37Hong Kong estate agency practice

Before recommending a property, a licensee should check and inform the customer of material information such as the property's:

  1. Owner's political views
  2. Saleable area, age and any known defects Correct answer.
  3. Owner's favourite restaurant
  4. Neighbour's salary

Explanation

Licensees must provide accurate material information about the property, including its saleable area, age and any known defects or encumbrances, so the customer can make an informed decision.

Question 38Hong Kong estate agency practice

When measuring and describing residential property, licensees in Hong Kong are required to use which area standard?

  1. Gross floor area only
  2. Saleable area Correct answer.
  3. Construction area only
  4. Garden area

Explanation

Hong Kong requires residential property to be described by its saleable area to give consumers a consistent and comparable measure. Quoting only gross floor area can mislead buyers about usable space.

Question 39Hong Kong estate agency practice

If a customer asks a salesperson about a defect the salesperson knows exists, the salesperson should:

  1. Deny any knowledge to protect the sale
  2. Disclose the defect honestly Correct answer.
  3. Change the subject
  4. Suggest the customer not worry about it

Explanation

The duty to act honestly and the prohibition on misleading customers require the salesperson to disclose known defects truthfully. Concealing or denying a known defect is a serious breach of the code of ethics.

Question 40Hong Kong estate agency practice

A licensee may only claim commission from a party if:

  1. The party orally hinted they might pay
  2. There is an estate agency agreement entitling the agent to commission Correct answer.
  3. The agent worked hard regardless of any agreement
  4. The deal fell through

Explanation

Entitlement to commission depends on a valid estate agency agreement with the party. Without a signed agreement entitling the agent to commission, the agent generally cannot recover it under the Practice Regulation.

Question 41Hong Kong estate agency practice

A salesperson who receives a referral fee from a mortgage broker for introducing a client should:

  1. Keep it secret from the client
  2. Disclose the benefit to the client Correct answer.
  3. Refuse to tell the EAA if asked
  4. Treat it as the firm's secret commission

Explanation

Receiving a benefit from a third party in connection with a transaction is a potential conflict of interest that must be disclosed to the client, so the client knows of any incentive that might affect the advice given.

Question 42Hong Kong estate agency practice

Which of the following is consistent with the code of ethics when handling client information?

  1. Selling client contact lists to advertisers
  2. Keeping client information confidential and using it only for the transaction Correct answer.
  3. Publishing a client's offer price online
  4. Sharing a client's identity with competitors

Explanation

Licensees must keep clients' information confidential and use it only for the purpose of the transaction, in line with the code of ethics and personal data protection principles.

Question 43Hong Kong estate agency practice

The validity period stated in a residential estate agency agreement is important because:

  1. It determines the licence renewal date
  2. It defines the time during which the agent is appointed and may earn commission Correct answer.
  3. It sets the stamp duty rate
  4. It fixes the property price

Explanation

The validity period defines the term of the agent's appointment, which affects when the agent is authorised to act and entitled to commission. The prescribed form requires this period to be clearly stated.

Question 44Hong Kong estate agency practice

A salesperson notices a colleague is about to let a client sign an estate agency agreement without explaining its terms. The salesperson should recognise that this:

  1. Is acceptable to save time
  2. Breaches the duty to explain the agreement before signing Correct answer.
  3. Is only a problem for commercial property
  4. Is the client's responsibility alone

Explanation

The Practice Regulation requires the agent to explain the contents and effect of the estate agency agreement before the client signs. Letting a client sign without explanation breaches this duty.

Question 45Hong Kong estate agency practice

Which form is the prescribed property information form for the sale of residential property?

  1. Form 2
  2. Form 3
  3. Form 4 Correct answer.
  4. Form 6

Explanation

Form 4 is the property information form for the sale of residential property, providing the purchaser with key particulars of the property. Form 2 is the equivalent property information form for letting.

Question 46Hong Kong estate agency practice

A salesperson is pressured by a manager to inflate the stated saleable area of a flat to make it look bigger. The salesperson should:

  1. Comply because the manager is senior
  2. Refuse, because stating a false area is misleading and a breach Correct answer.
  3. Inflate it only slightly
  4. Blame the developer if challenged

Explanation

Stating a false saleable area misleads buyers and breaches the duty to provide accurate information. The salesperson must refuse, regardless of pressure from a manager, because each licensee is personally responsible for compliance.

Question 47Hong Kong estate agency practice

The code of ethics requires licensees to act in the best interests of their clients while also:

  1. Ignoring the rights of customers
  2. Treating customers fairly and honestly Correct answer.
  3. Favouring only repeat clients
  4. Disregarding the law where convenient

Explanation

While acting in the client's best interests, a licensee must still deal fairly and honestly with the other party (the customer) and comply with the law, balancing duties to both sides of a transaction.

Question 48Hong Kong estate agency practice

In the law of agency, the person who appoints an agent to act on their behalf is called the:

  1. Customer
  2. Principal Correct answer.
  3. Trustee
  4. Bailee

Explanation

The person who appoints an agent is the principal. The agent acts on the principal's behalf within the authority conferred, and acts done within that authority bind the principal.

Question 49Hong Kong estate agency practice

An estate agent owes their principal a fiduciary duty, which means the agent must:

  1. Act in their own interest first
  2. Act in good faith and avoid secret profits Correct answer.
  3. Disclose nothing to the principal
  4. Compete with the principal

Explanation

A fiduciary duty requires the agent to act in good faith, in the principal's best interests, and to avoid undisclosed conflicts of interest and secret profits. Breaching this duty can make the agent liable to account.

Question 50Hong Kong estate agency practice

A 'sole agency' appointment means that during the agreed period:

  1. The vendor may appoint as many agents as they wish
  2. Only that agent is appointed, but the vendor may still sell privately Correct answer.
  3. The agent may sell the property without the vendor's consent
  4. The vendor must pay no commission

Explanation

Under a sole agency, the vendor appoints only one agent for the period. Depending on the terms, the vendor may still be able to sell privately, but cannot appoint another agent. This differs from a sole-selling-rights arrangement.