Becoming a Real estate agent...worth it?

Question

David Hutson · Answer

@Heather Rodden,

I have my license (part-time agent) and have been using it primarily to sell my investment homes in CA.  I find the commission I save on one house per year saves me all of the expenses I would have paid a realtor for my part of the sale.  I will be selling off at least two houses per year so I'm definitely ahead.

Second, I have friends who need help buying or selling or that refer others to me so it's provided me three other sales this year without me doing any searching for clients.

Third, it gets me in to houses without needing someone else to let me in and then I can write my own offers if I were to choose to.

Cons are that it takes considerable time to study and take the test.  I know in CA many people do not put the effort in and fail the test at least once.  Be prepared to study content that will help you stay out of trouble.  CA's test did nothing to help be a successful agent.

The fees for the test, state real estate bureau fees and the office you work with are a few thousand dollars a year.  Again, if you sell a decently priced house your fees for the rest of the year can be covered, a $40k house won't cover it.

Lastly, off the top of my head, you are held to a higher standard with your license.  People and the real estate board will require you to be professional and you are expected to do what's best for your client, not what's best for you.  As an example, I had a complaint against me this year for selling a house to fast (hahahahah).  Another agent complained that I listed a house for sale and only left it available for 24 hours.  I explained to the board that I received a full-price, cash offer and that's all I believed the home would appraise for.  It's what the seller wanted.  They closed the complaint immediately but I still had to take the time to respond and discuss it with them.

My advice is to think about what you really want to do with your license.  Then consider what else can you do with it.  Who can you help purchase or sell homes to.  If you have a large group of friends and family, in addition to using your license for investing you should tell everyone you know you have your license and would be happy to answer questions or give them values for their homes.  If you aren't pushy then they may ask you to help buy or sell their home.

Curt Davis · Answer

I make more money by having it then by NOT having it. I have been able to list investors homes for sale and make commissions, I have also done some normal retail buyer and seller transactions.

In my opinion is is worth it.

Good luck

Scott Wolf · Answer

@Heather Rodden, I'm basically echoing @David Hutson here, but for me it was a great way to collect some extra money on the side by referring my friends to realtors, and getting referral fees before I went into the business full-time. (Very long and winding  story, but I was in then out after a failed family venture.)

Currently I use it to still get referrals from my friends & families, but also use it for access to properties, and add some legitimacy to my discussions with brokers and owners.  Although, you may want to find out if you have someone willing to hold your license, if you're not going to be doing it as a full-time profession.

John M. · Answer

@Scott Wolf You did make a good point I didn't think about, at least in my case having a license led to deals and establishing good relationships with some pretty big name brokers as a closer, which does add quite a bit of "street cred" that others won't have.   That can actually be well worth it....

Zach Cummins · Answer

I have played around with this idea myself. I do love real estate, however I just don't know if I would want to subject myself to being available to show houses or having clients if that would obligate my time. Maybe if I just did real estate for close family and friends. The real benefit I see with the real estate license as an investor would be making multiple offers on my own time and not needing a realtor. Best of luck to you!

Russell Brazil · Answer

High earning potential. High failure rate. Its worth it if you are successful and you love doing it.

John M. · Answer

I got my license in 2010 and actually was one of the top closers in my office of about 40 agents the first year.  However, after my expenses, MLS fees, Board fees, marketing, comission splits, blah blah I was making less than when I had a full time job.  I did it for about 3 years and had a lot of fun, made enough to pay my bills, made some amazing client friendships that changed my life,  but at the end of the day I was making a lot more money in technology (that was my career prior to real estate).  So went back to that full time and then taking that income to invest in real estate.  I still keep my license since it's already active but don't have time to represent clients anymore.

For a real estate investor it might be benefit for reasons @David Hutson had mentioned, but if you want to do real estate sales full time it seems to me the industry is changing very rapidly due to disruptive technologies and websites like Redfin, Zillow, etc., which I think will be a big challenge for new agents with no established client base.  And with inventories so low the last couple of years I am sure the competition between agents is brutal.

Becoming a Real estate agent...worth it?

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