Should I become an agent before buying my first home or use another agent until I start building my portfolio and acquiring properties more frequently ? Is it worth paying the fees if I'm only buying 1 home a year for now?
You get to keep the commission on the house you buy. The commission on your first property should cover the fees for at least the first year.
@Justin Feliz I would make the decision based on the fees in your state and the price point that you plan to buy. For illustrative purposes ( I don't know what the annual fees are in NY), if it costs $2k/yr to maintain a license (MLS, E&O Insurance, other fees, etc.) and you intend to buy properties that will generate commissions of 3k/ purchase (3% of 100k) then it may pay for itself. It also makes you eligible for referral fees that you can earn by networking and referring business to other agents if your job doesn't allow you to have time to be an active agent?
I invested for a long time on side of my career before getting my license. If I had to do it over again, I should have got my license sooner. There are so many advantages to having it. If you search for the topic, there's a lot of discussion of the topic here on BP.
I'm getting my license before investing. I'm doing the pre-license class 3/28 to 5/3 and hope to have the license in hand within 3 wks after that. I plan to work as an agent on the side to help pay for properties I might want to purchase.
Sounds like the way to go, good luck! @Tanja Davidson
I have a question for you New York City Agents. Back in 1990 during the RTC days my brother and I and our wives went to Scottsdale, Arizona and settled for a couple of years while we took advantage of the Big Give Away. I also became eligible and passed the state broker exam but didn't take the final step because I could use my California brokers license to buy, just couldn't list.
Any way while taking the state required course I met a husband and wife New York City Real Estate Broker team moving to Phoenix and they couldn't get close to passing the exam. So one night after class we went out for a drink (11:30 pm and still 107 degrees),
They explained that they really didn't write up contracts, for 25 years they really just wrote up binder agreements and then turned everything over to the lawyers, they didn't really require any legal or contract knowledge of any great amount in NYC. They just needed selling skills.
During this conversation it came up that there was no MLS and I said it sounds like there is some money to be made going back to NYC and starting a MLS after they mine Phoenix for some gold and they could use their NY brokers license to get some commissions when buying in AZ. I said when you find a deal call me I'll help you write it up. They made some good money and bought a house in Cave Creek to come back to. They then headed to NYC to start a MLS. So my question is does NYC have an effective MLS now days or what? Just curious if they started something or what? My mother in law was from New York City and I got tired of hearing about the place so anytime when the subject came up my mine would go elsewhere.
107 degrees in Phoenix at 11:30pm?
Must have been springtime.
Has anyone encountered a problem of loosing investor status based on becoming an agent. In the eyes of the irs of course. I get mixed answers on this.
Free eBook from BiggerPockets!
Join BiggerPockets and get The Ultimate Beginner's Guide to Real Estate Investing for FREE - read by more than 100,000 people - AND get exclusive real estate investing tips, tricks and techniques delivered straight to your inbox twice weekly!
- Actionable advice for getting started,
- Discover the 10 Most Lucrative Real Estate Niches,
- Learn how to get started with or without money,
- Explore Real-Life Strategies for Building Wealth,
- And a LOT more.
Sign up below to download the eBook for FREE today!
We hate spam just as much as you
Get the Ultimate Beginner's Guide
Sign up today to receive the popular eBook for free!