To be or not to be: a real estate agent

[Theresa Schmiedel]

I am brand new to real estate investing (education phase) and am curious to weigh in on others' opinions on whether or not it is worthwhile to get my real estate license? Any and all insight is appreciated! Thank you and I look forward to growing in this community & making lasting connections.

[Joe Splitrock]

Quote from @Theresa Schmiedel:

I am brand new to real estate investing (education phase) and am curious to weigh in on others' opinions on whether or not it is worthwhile to get my real estate license? Any and all insight is appreciated! Thank you and I look forward to growing in this community & making lasting connections.

 It is a tough time to be a real estate agent. Very competitive for listings and buyers agents. There is not much inventory, so you need to be very aggressive to help your clients close deals. New agents always have to work harder, but this is even worse.

Are you looking to do it full time or just wondering as a side gig? You need a place to hang your license, so it can hard for part time agents. Talk to some brokerages in town and explain what you are trying to accomplish.

[Theresa Schmiedel]

I was looking to add it to my credentials for investment purposes. I just wasn't sure if it would save me a lot of time/headaches if I could handle closings/etc on my own. So I suppose my real question is- is there a better place to hang my license as a "part-time" agent? Or if I am strictly investing & not planning on using my license to help others purchase homes is it even worth it to have the education, access to upcoming available properties, connections, etc associated with getting my license or best to just work with a realtor when needed? 

[Remington Lyman]

Originally posted by @Theresa Schmiedel:

I am brand new to real estate investing (education phase) and am curious to weigh in on others' opinions on whether or not it is worthwhile to get my real estate license? Any and all insight is appreciated! Thank you and I look forward to growing in this community & making lasting connections.

I think you should only get your real estate license if you plan to invest full time. 

[Eric Janson]

You don't need a license to if you are only going to invest, unless you want to become a Real Estate Agent.  You just need to hire the right team.  With the right team, you can focus on investing and let you team take care of the rest. 

[Russell Brazil]

Lets look at typical cost to maintain a license.

MLS - $1,000
Realtor Association - $1,000
E&O Insurance - $900
Sentrilock/Suprakey Access - $300
2 Lockbox Purchases - $400
Licensing Fees - $200
Continuing Education - $250
Increase in Auto Insurance - $300
Miscellaneous Brokerage Fees - $1000

$3,000-$6,000 a year to maintain a license that the majority of people dont use really explains why 87% of people who get a real estate license do not have a license 3 years later. 

[David M.]

@Theresa Schmiedel

There are many threads on this if you have time to poke around BP...

But, unless you are going to do it full time and/or you will be constantly doing deals, getting your license isn't worth it.  The carrying costs for the license is more like low $2k's for me and I work for a traditional brokerage.  However, that will add up over time.  Also, your broker is going to want you to produce.  Depending on their setup, you will be losing him money if you aren't brokering deals and/or losing him money because you are taking up a slot for a productive agent.  Remember, brokers make their money off the backs of the agents.

Remember whatever the buyer or listing side gets in commission, it really goes to the broker from whom you get your split.  There is a reason why its a sales job and to make a living you have to hustle.

As for the license training, its pretty much unamious that it doesn't prepare you at all to be an agent.  Its just teaching you about the laws, regulations, and some fundamental terms (so you can understand the laws and regs) so that the powers that be can give you a stronger punishment if you mess up.  After I got my license, I didn't know anymore about real estate or doing investments and nothing about being a real estate agent.  Its not a trade school.  I still had to go to the brokerage to learn how to use their systems to administer a deal, to say nothing about all the sales aspects (e.g. lead generation, advertising, the "sales" part of dealing with clients/customers, administering transactions, etc.).

If you can find your deals off-market, then you really don't need a license.  However, the license could be a second revenue stream, if you learn the trade...

Yes, I agree its nice to have direct access to a MLS or two (N.B. there is no "one" MLS), but it comes at a cost as been said. Its up to you if its worth it. I'd be happy to chat about if you want, just let me know. Good luck.

[Brandon Goldsmith]

Like many of the others said, it depends on what you want to do with it. It can be expensive to maintain it if you are only using it casually and for some investing. @Theresa Schmiedel

[Marc Rice]

It was a great decision for me and allowed me to really scale quickly.

[Anthony Buccanero]

Originally posted by @Theresa Schmiedel:

I am brand new to real estate investing (education phase) and am curious to weigh in on others' opinions on whether or not it is worthwhile to get my real estate license? Any and all insight is appreciated! Thank you and I look forward to growing in this community & making lasting connections.

Theresa, 

I recently just signed up as a new agent in my state as I was in the same predicament as you.  I chose to obtain my license because the pros outweighed the cons associated with that, and also it fits in nicely for what my family is trying to accomplish in the Real Estate Investment Game and life itself.  It does involves a bit of work and research along with fees as noted in other posts, but do not let that discourage you!  What do you want to get out of it?  A career?  A lifestyle?  It can be extremely hard to motivate oneself in a position of flexibility that comes with being an agent, but the resources available on that side of the fence are expansive.  In my opinion, try deciding if getting a license and all the baggage associated with it is worth the time and effort.  Best of luck to you!

Tony   

[Joshua Noth]

@Theresa Schmiedel to echo a lot of what has been said already... if you are considering getting your license to streamline your own investing, you will need to invest full time like @Remington Lyman said.  Otherwise, the fees behind it will just be added weight to your yearly costs, and it may not give you the full benefit you are hoping for.  Having a good Core 4 can accomplish that "streamlining" for you.  Additionally, many people on these forums on prime examples of this: just because you are an agent doesn't mean you know the market better than someone who isn't

That being said, as many on here would say, being an agent can also help your own investing goals, especially if you are investing in your own local market where you are an agent.  You get active insights into the markets and its trends, you can be quick and timely with your offers, amongst other things.  At the same time though, many on these forums on prime examples of this: just because you are an agent doesn't mean you know the market better than someone who isn't.

[Eric James]

Maintaining a license is an expense. Probably not worthwhile unless you'll be buying or selling multiple properties per year.

[Harry Davis]

Originally posted by @Russell Brazil:
Lets look at typical cost to maintain a license.

MLS - $1,000
Realtor Association - $1,000
E&O Insurance - $900
Sentrilock/Suprakey Access - $300
2 Lockbox Purchases - $400
Licensing Fees - $200
Continuing Education - $250
Increase in Auto Insurance - $300
Miscellaneous Brokerage Fees - $1000

$3,000-$6,000 a year to maintain a license that the majority of people dont use really explains why 87% of people who get a real estate license do not have a license 3 years later. 

you didn’t mention the cost of the class you take before the exam, the fingerprints and application fee. 

[Bruce Woodruff]

Not necessary if you are going to invest for yourself. Makes absolutely zero sense. Only if you want to be a Real Estate agent for a career. It would be like getting a Contractor's license if you only plan on doig flips and owner builds......?

A good Realtor earns his/her money, it is an incredibly tough job....