Should I become an agent to do Investing?

Question

I've heard both sides but for my local market (Houston, TX). Benefit: access to MLS to get expireds and comps. Also get to list my own stuff and save the realtor fees for each house after a fix up. Problem: have to disclose it over and over again. I would love to know your opinions of whether I should take the time to get my license or if I should just find a good partner. Thanks in advance! Kimberlee

Brian Gibbons · Answer

I think having a REI company and having a licenced agent as a member of that company is a good. thing.When I am not licensed I can talk to "an active listing" and not have a conflict. Selling on terms (from the home seller's perspective) and having a "plan b" in case the house does not sell with a traditional listing is a good thing.Also, going after an expired listing, with the home seller frustrated with agents and saying "the seller can avoid the sales commission by selling to me on terms (lease option, wrap, etc)" is another good thing.Having a license on the rental or sales side I believe helps.And in some states, if you do lease option flips, it pays to have a licensed broker, not sales agent, as part of your llc (pay like a flat fee to look over the deal).Best wishes to you,Brian

Thomas Kiefer · Answer

I am very new to the business so I don't have any helpful insight to give you, but I have decided to get my license. It makes since to me in that I can look at homes without having to wait on someone else, especially homes that aren't currently occupied. Because I'm currently relying on wholesalers, I have found that as a general rule, they are very liberal in their ARV's. I looked at a house yesterday where there were recent comps on the same street they chose to ignore in order to get better comps in other parts of the subdivision. I am seriously considering adding wholesaling to my business model with an eye towards fair profits for me and solid comps to the investor. To begin with at least I can only do one or two flips at a time so I hope to wholesale the others and at least get something out of the deals I find.

Mary B. · Answer

Hey @Kimberlee Lado I've gone through the same thought process and have decided to go for it. Years back I didn't want to have that hinder my negotiation ability but its a different ball game today. It looks like it has more benefits than setbacks(if any).... My thoughts are get licensed and if it doesn't work out, you don't have to renew when the time comes. Kudos,Mary

Steve Vaughan · Answer

If you are thinking that obtaining a sales agent license will be a good education for investing, it's not. I did the hours and learned the info to ace the sample tests and chose not to move forward with the licensing. I stopped when I realized all clients obtained (I was just looking to grow my PM biz to be able to manage for others) are not mine. They are the property of the broker. All clients you obtain will be the property of the broker as well. All deals you do will probably involve sharing with your broker on some level. The test teaches you some law on RESPA and such, teaches you the square footage of an acre, metes and bounds reading and how to farm listings. It's been a while for me, but I certainly didn't find the 'education' amazing by any stretch. Helped me about zilch as an investor.It goes back to your purpose. Are you looking to be a sales agent? Many do well and are glad they have it. Looking to have full access to the MLS and their full retail, frothy prices? It's pretty costly in time and money to maintain the license just for that. Don't let this stop you from going out there and finding the off-market, quiet deals you need to buy right @Kimberlee Lado ! Attend some meetups and meet folks that are actually out there investing and making things happen!

Shawn Thom · Answer

I think it depends on what facet of the business you are going to be working and where you intend to get your leads. My opinion, in my market, right now its hard to get a deal on MLS and those leads are over worked for traditional investor purchases. If you are going to offer some sort of new twist like owner finance or lease purchase you may work an angle fewer are working. If you are doing flips, you may save some on the sell side, but there are plenty of flat rate realtors you can work with that offsets that benefit to me.If I were to get a realtor license, it would be purely to be able to go see other houses more freely. It could grown into more than that, but with a full time job I'm not looking for more work.I currently rely on wholesalers so have less use for realtors for the initial purchase.