Education requirements, activities that require a license, and exemptions

Start with the activity

New York generally requires a real estate license when someone acts for another, for a fee, commission, or other valuable consideration, in activities described by Real Property Law § 440. These include listing, selling, buying, exchanging, renting, negotiating those transactions, and collecting rent. Offering or attempting a covered negotiation counts; a closing is not required. Section 440-a requires the license before acting, even temporarily, or holding oneself out as a broker or salesperson.

A paid manager who negotiates leases or collects rent for an owner performs covered activities. A worker who performs maintenance without leasing, negotiation, or rent collection does not need a real estate license merely for those repairs. Compensation need not be called a commission. Section 440 also covers negotiation of mortgage-secured loans other than the residential mortgage loans it excludes from that definition. That exclusion does not establish permission to originate residential loans without other required licensing.

Distinguish an exemption from a job title

An individual selling or renting their own property ordinarily is not acting for another. That does not extend to a friend who negotiates the owner's sale for compensation. An attorney duly admitted to practice in New York is exempt from the real estate licensing provisions. Court-appointed receivers and trustees in bankruptcy, and executors, administrators, and trustees acting within their fiduciary duties, also have exemptions. A person acting under a duly executed power of attorney to carry out a real estate contract has a limited exemption, not general permission to operate a brokerage. Evaluate the person's actual legal capacity and activity; a title such as consultant or property manager does not itself create an exemption.

New York also provides a specific exemption in § 440-a for qualifying tenant associations and nonprofit corporations authorized in writing by the appropriate New York City commissioner, or appointed by a court, to manage city-owned residential property. It applies to the properties so managed, not to all nonprofit management work.

Separate initial education from renewal

Real Property Law § 441 requires proof, before application, of attendance at and successful completion of at least 77 hours of approved salesperson education. Approved distance learning may qualify when participation can be monitored and verified; the Department of State may require specified subjects or hours in a classroom. The application identifies the sponsoring broker. The Department's written examination assesses competence and trustworthiness, including law, fair housing, practical skills, and ethical obligations. A course completion certificate is not a license.

For renewal, § 441 requires at least 22½ hours of approved continuing education within the preceding two years. Included minimums are two hours of cultural competency, three of fair housing and/or discrimination, two of implicit bias, two and one-half of ethical business practices, one of recent legal matters, and one of agency law. During a salesperson's initial two-year term, the agency minimum is two hours. These are renewal requirements; do not substitute them for the initial 77-hour course.

Proof of required continuing education must be submitted and accepted before expiration for the license to continue. Section 441 allows the Department discretion to issue a temporary renewal when failure to submit proof is not the licensee's fault.