Hawaii Pre-Licensing National Practice Exam

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Prepare for the Hawaii Pre-Licensing National Exam. Access flashcards, multiple-choice questions, and detailed explanations. Boost your confidence and excel in your licensing test!

Each practice test/flash card set has 50 randomly selected questions from a bank of over 500. You'll get a new set of questions each time!

Practice this question and more.

A new licensee should avoid which of the following types of transactions?

Sale of a small residential property
Lease of commercial space
Sale of a large office building
Rental agreements for residential units

The correct answer is: Sale of a large office building

A new licensee should particularly avoid engaging in the sale of a large office building due to the complexities and experience required in such transactions. Large commercial transactions typically involve a detailed understanding of zoning laws, financing options, lease agreements, and various commercial real estate concepts which may be overwhelming for someone who is just starting in the real estate business. In addition, the stakes are considerably higher in transactions involving large office buildings, including larger financial risks not only for the licensee but also for their clients. This can lead to potential liability if the new licensee is not fully equipped to handle the nuances of such deals. By contrast, the sale of small residential properties, leasing of commercial space, and rental agreements for residential units tend to require less specialized knowledge and can provide a more manageable learning experience for new agents to build their skills and confidence. These transactions usually involve more straightforward processes and smaller financial commitments, making them more suitable for someone who is just beginning their career in real estate.