Should I get a Calif RE license if I'm investing out of state?

Question

Hi,

I'm looking for advice from the BP community on the value of getting a real estate license as a long-distance investor.

I live in Silicon Valley, California, and have begun my investment career by investing in residential property in Austin, Texas. I might invest in other locations down the road, but I do not plan to invest locally - the rent/purchase price ratio here is so low that properties won't cash flow, and (my opinion) the state's laws are hostile to landlords. So it's strictly long-distance real estate for me.

I've been thinking about getting my Real Estate license. Access to MLS would be very handy. But, Texas requires that I be a resident of that state in order to get a Texas license. So, I think I'd be restricted to getting a California license. California doesn't have reciprocity with Texas. So I'm unclear: would a California license be useful if I'm investing strictly out of state? If not, are there alternatives (short of moving to Texas) that I should consider?

Thanks in advance for any advice or wisdom.

Joel Fine

Grant Linhart · Answer

Joel,

Im in the biz in Colorado so that is basis for my answers.  And I agree with you, CA is hostile to landlords so if your not investing in CA, no need for a license there.  It is no good in Texas.  If Texas agents are taking care of you, your in good hands.  As far as Zillow, just like Realtor.com and others, those are marketing sites that are reselling your info.  They are typically 3-4 days or more behind in current and relevant data.  Time and time again in our Denver area market folks come to me with a Zillow listing and its not current and the home is under contract or sold and Zillow doesnt show it.  It burns up my buyers emotional equity.  Rely on the Texas agents to give you current data.  I would suggest getting just one agent if you can in Texas and develop a relationship so they take care of you and when your ready to deal they will be too.  Good luck.

Blake Edwards · Answer

Hi Joel,  I agree MLS access is useful to not only run comps but see the "Coming Soon" properties as well.  If you have a good relationship with an agent, you could become their assistant and they could give you MLS access.

Ronald Rohde · Answer

I'm exclusively in North Texas. Dallas County and Collin County, but our basis is considerably lower than prices now. I'm looking a small MF in Tarrant county now...really out of SFR game....

Logan Gerard · Answer

@Joel Fine I don't think getting your CA license would be particularly helpful. What I would do is find a licensed agent in Texas with experience who you can establish a long-term relationship with and who can run comps for you!

Seperately, @Ronald Rohde, so you are no longer investing in Dallas County and Collin County? Also, are you flipping homes or holding them as rentals!?

Joel Fine · Answer

Great question @Ronald Rohde. I'm cash flowing in Austin but not as well as I'd like. I am looking at other areas for my next investment. How about you - where are you investing?

Ronald Rohde · Answer

Sounds like you have your answer, but are you cash flowing well in Austin? Many of the SFRs there are reaching record high sales prices...

Joel Fine · Answer

Thanks @Grant Linhart for the information and perspective.

I can imagine that Zillow might get out of sync with MLS, although that hasn't been my (admittedly quite limited) experience to date. When I first started searching for a house in Austin, Texas, a couple of months ago, there were several occasions when I would ask my realtor about a house that had just popped up for sale on Zillow; a day or two later that house would show up in the automatic search e-mail. And, when I bought a house in Austin last month, Zillow was updated within minutes with "pending" and then "no longer on the market" notations as the transaction progressed.

In any event, I do have several automated search e-mails that a few agents have set up for me. The combination of those searches, along with my own monitoring of Zillow, realtor.com, and Trulia seems to be getting me pretty up-to-date MLS information. And as for the original question in my post, I'm not seeing a reason to get a California license at the moment.

Joel

Joel Fine · Answer

Thanks @Jordan Moorhead for the suggestion. I actually do have about a half-dozen searches set up by a few agents I've talked to over the past couple of months. However, I've found that by regularly checking Zillow, I can find relevant listings about as well as those automated searches.

I've heard that agents can see information in MLS that ordinary mortals can't, and that this information can be valuable. Competitive Market Analyses, different types of historical sales data, agent notes are the ones that come to mind. But I guess a California license wouldn't get me access to that information in Texas.

So, I haven't yet found a good reason to put in the effort and $ to get a California license, and your reply is consistent with that.

Thanks again!

Should I get a Calif RE license if I'm investing out of state?

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