Real Estate License

[Lauren Lucas]

what exactly do you need a real estate license for? Do yuu need it if you buy and hold? or flip?

[Aaron Mazzrillo]

You don't need it to do either. There is no landlording license that I've ever heard of. In some counties here in CA, the city makes us get a business license for each rental property, but it is just a small annual fee.

If you are flipping lots of houses, a license will save you tens of thousands of dollars in commissions. It also gives you more control in the marketing of your product. I've never once met a real estate agent that even watched a youtube video about marketing. They think putting their face on a bus bench is a good strategy. Have you ever seen the people hanging around bus stops? Not many of them look financially fit to buy a house!

I am licensed for many reasons. There is no usury for Brokers here in CA so I can.. well, I used to be able to broker loans at higher interest rates on seller financing deals I did. Not sure how the new mortgage laws affect that, but I am no longer doing those types of deals so it isn't an issue. I also control my own access to the MLS which I much prefer. I am a member of the state association so I get access to free legal help which has come in handy many times.

Having a license definitely adds to your credibility and allows you to do other things such as manage other people's properties, list houses you can't buy, and hire an agent or two to pawn off listings on which still gives you a commission. You have to weigh the costs/time investments and benefits to see if it is worth it to you. The most successful investors I hang out with are all licensed.