Should I get my real estate license?

Question

Lumi Ispas · Answer

@Gage Westhouse, Account Closed is right on the money!

Access to the MLS is huge, and networking and meeting brokers could be of a lot of help long term if you will go to broker network meetings. Keep in mind that taking the license will not teach you anything about Real Estate beside following the law!

Learning the skills will be on you, and if you join the right office, they will teach you a lot about pricing properties, learning to finance, selling skills, and of course, a lot of emphasizes will be on finding clients, writing contracts and negotiation skills.

If you intend to sell real estate full or part-time, it will be worth it. If you don't, and all you need if for you for 1-2 transactions a year, the fees and time involved might not be worth it.

While overall my license helps me, it doesn't if I want to wholesale, and when I negotiate deals, I am seen as an expert, and off the market, deals are sometimes harder to get done, as the sellers always are under the impression that I know something they don't know about the area and are hesitant about selling. Out of a sudden, they want to raise the prices on me. Most of my properties I bought from MSL I had to pay full price or close to it!

This year I lost two deals where I wanted to assume the mortgages, as the sellers thought that they will lose something if they sell, and decided to hold on their properties! It can be frustrating.

If you are licensed you have to disclose in writing on every deal you do and if you sell your own property you can't sell it to someone that's not represented as the Error and Emission insurance won't cover you.

Make sure you get a clear goal of why you want the license and understand all the costs involved to holding the license yearly and all the training required to have. In other words, weigh the time and money you want to invest in being licensed!

Good luck to you!

Jacques Cyr · Answer

@Gage Westhouse great question. I've been in REI for several years and finally got my license this past year. Mostly to sell some of the properties I have in Muskegon and Kalamazoo area. The goal was to pay myself commission. :)  I believe Eunice and others mentioned the upside(s).

From my perspective:

• If you plan on simply buying and holding, and you have a relationship with an agent that understands investor perspective, then the cost would perhaps outweigh the upside. (meaning your desk fees, etc... could cost you more than you would make in commission). 

At Berkshire Hathaway we have solid resources for setting up alerts, and market reports to track markets as seller sided as the Grand Rapids Market is. (Sellers market)
• At Berkshire Hathaway we have solid resources for setting up alerts, and market reports to track markets as seller sided as the Grand Rapids Market is. (Sellers market)
• So far, I've been able to find more off market leads from my own marketing efforts, and/or my network (outside RE agents). 
• However, if you'd like to flip, or have the funds to do larger volume of units, then there would be good upside.

• At Berkshire Hathaway we have solid resources for setting up alerts, and market reports to track markets as seller sided as the Grand Rapids Market is. (Sellers market)

Hope this helps. Feel free to reach out with questions: 617  775    9352 (M)

Jacques

jacquescyr.com or rubiconinvestmi.com

Account Closed · Answer

If you do more than five per year, you'll have to be.  If you're doing seller financing, you'll also have to be a licensed mortgage originator or use one.  Check with a good real estate attorney to make sure you've got your bases covered.  (Always a great idea to take the licensing training--you'll learn a lot that you'll not found out in other ways.)

Eunice L. · Answer

By the way, I have talked to multiple RE investor friends who have their license and they have expressed to me that it has been worth it for them.

Account Closed · Answer

MLS data and ability to talk with agents directly are major plus's, the downside is the fees.  Unless your doing regular buy or sells yourself or large transactions every few years, you need to sell for others to justify the expense.

John Thedford · Answer

It can pay for itself in many ways. Some of my purchases were easier because the sellers felt more comfortable dealing with a licensee even though I was the principal and not representing others. If you get offered a property you cannot purchase, you have the option of listing it. Not so without a license.

Account Closed · Answer

The office fee splitting and or monthly fees factor into all this as well, a lot of differences there.

Account Closed · Answer

Interesting Lumi, if I was selling, your money would be as green to me as anyone else's. Sold my last house to a real estate agents brother in-law, the above average Co-op fee money staying in the family might not have mattered, will never know?

Jonathan Damon · Answer

It really depends on what you're doing. For wholesaling no way I would do it. For investing and fix and flip definitely.

Carlos Zapata · Answer

@Gage Westhouse   hope the best, I have license in Virginia and Florida,  having the license is great for your business, the only bad thing are the  fees involve but you will cover it pretty easy with commissions,  sometimes the other agents want to play hard with you because you are an agent but you will learn to overcome that.  The other good thing is I offer my part of the commission to the listing agent and they normally are more willing to work with me after that

Should I get my real estate license?

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