Should I get my real-estate license?

Question

I am thinking about getting my real-estate licence to help me with my investing. Would doing so be a big help or am I just wasting my time?

Larry Watson · Answer

Yes, I just got mine in NC and eventually you can be your own broker in charge and save 50% on the sales commision.

Jill DeWit · Answer

@Michael Watkins

First of all, you do not need a license to be a real estate investor. Why? Because you are not representing anyone. You are buying property for yourself.

Having said that I think more education is always a good thing. I looked online and it appears you can find real estate agent classes in Georgia for about $400. If you are on the fence, why not attend all the classes, learn as much as you can, and then decide at the end if you want to follow through with getting your license.

Having a licence solely for the purpose of obtaining access to the MLS is not necessary anymore. You want to reach sellers BEFORE their property hits the MLS anyway.

Hope that helps! Jill

Kevin Fletcher · Answer

I just wrote a blog about this, sorry if its a little long

TO GET YOUR REAL ESTATE LICENSE OR NOT TO  GET YOUR REAL ESTATE LICENSE? THAT IS THE QUESTION!

I  have found that many real estate investors that look to do  fix and flips struggle with the decision on whether they should get  their license or not. I have compiled a list of Pro's and Con's and Personal Experiences to help people find an answer to this important question.

I  have been a real Estate Investor for about 8 years doing all types of  investing but mainly Buy and Hold and Fix and Flips. Originally I  planned to get my license primarily to just get better return on my  deals, but as I was going through the process of school for the license,  I really started to get more interested in also being an agent on the  side so supplement my investing income. It has been a blessing so far.

Pro's

• Saving Brokers Fees on Your Deals  - This is the reason most investors want to do get a RE License in the  first place. I saved a lot more in my first purchase/sale with my  license (14k) then it took me in money to go to school, get my license, and all the other fees for the first year which came out to about 3k total. If you account for a 6% +/- greater return on your investment, many deals become a lot more attractive. You can afford to do flips that others cant.
• Supplementary Income   - Now, with my license,  I have worked with client  purchases and  sales, and have already made more this year with my license then with my  investing. If you are waiting for a project to do, or a property to  sell, there is time to work with clients in the lulls that flipping can  create.
• Understanding of the Process -  Going through school was a blessing. I found there is a lot I should  have known about the process of buying a house that my former agents  never told me.  Most agents say "just look over the contract and sign it"  which can be dangerous. There was no way for me to fully understand  these contract until I spent hours studying them. I know now to always  go over the contract with my clients thoroughly for them to understand  what they are getting into, and what are the ramifications.
• Control From Start to Finish - With your License, you can buy, project manage, control timeline, design, problem solve and sell the the project. Its ultimate control, You  will control every aspect from start to finish which makes it easier to  get things done in a timely matter. There are less factors to derail   aspects of the project.
• Being in the Real Estate World/Networking - It  has really been a help to my investing to be an agent because I am more  in the RE world, so to speak. I meet agents buyers, sellers, investors,  title companies, lenders, inspectors, and contractors everyday which helps  all aspects of my RE goals. That networking is huge. Also for leads on  projects, The other day I just found a buyer for one property and they  said they needed to sell their house, and it was in poor condition. It  was owned free and clear, and it was an instant deal for my next flip.

Con's

• Liability Issues - The truth is, Yes,  with a RE license you have more liability concerns. People will tell  you its not worth the liability aspect of it, and going through school  you will see why they worry. Real estate licensing school just prepares  you for the test. The test is predominantly about RE Law, and laws that  are broken have consequences. It will freak you out honestly,  but after the test is over you will know how to navigate and act  lawfully as an investor with a RE License. The main thing that's  important to learn is  Disclose, Disclose, Disclose... For us as investors, Its all about disclosure of adverse material facts about the property.  And above that, don't discriminate or lie. I have not ran into any liability issues and I don't plan to, and there are ways to "CYA" such as written disclosure, contracts,  and honest dealings.
• Control from Start to finish - Above I have this as a pro, but It can also be a Con. Having control from start to finish also means that all the risk and responsibility of any investment is on you.  You have to be on top of the project, or you are the one who will  bear  the brunt of problems that may arise in any aspect of the deal. It can be too much to take on for some investors.

Hope this helps

Christie Bussey · Answer

I would add to: research what the disadvantages are having a real estate license while practicing as a real estate investor. There are some. I would say if you just have to have a Real estate agent in the family just to allow deals to run smoother enlist a family member for that task or take the class just to boost your knowledge of that side of the business; but the decision is solely up to you as to whether you would still want to sit for the exam afterwards. Better yet, there is story on here written by JSCOTT- Feb 24, 2010 pertaining to this very question.

Ethan Atkinson · Answer

Do it! Yes it's smart.  If you do lots of advertising you can always talk about both sides that will help a seller, and a buyer.  You can buy properties from some distressed or not distressed seller, or you can help them list it for sale if they won't take the cash offer, or financing or whatver creative way you offer to purchase.  Quite often the 3-%% listing commission will be more than you could have made with a wholesale fee. And if you don't want to list anything, or aren't experienced yet, then you can refer the leads legally and for a fee to another listing agent for 20-30% of the commission. It is just smart.

Should I get my real-estate license?

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