Real Estate License before starting?

18 Replies

So I plan to start out by house hacking and buying a Duplex or maybe even Triplex of Fourplex.

My questions are: Is it a good idea to get my Real Estate License first?

Also, I noticed when reading up that there seems to be two different licenses. A Sales and a Broker license. 

Which one should I go for if I plan to become a serious investor?

Are there any California investors here who can give input on where I should go to get my license?

Can it be done online?

I should also mention I'm from Southern California. Which is where I will probably end up buying.

Thanks in advance.

I'm my opinion, you don't need to have your real estate license to start. However, there are definitely upsides to getting licensed in the long run.

The benefits include being able to had direct access to MLS to run comps and to have a consistent flow of market properties in front of you.

Analyzing those deals is another story. If you first start by working on your house hack by working with an experienced realtor you’ll get much more experience compared to trying to jump in with your license. 

Like @Jay M. said in the long run it could be beneficial to have MLS access and you're also able to put together your own deals.

Either way I suggest starting by working with an experienced investment realtor who’s able to help teach you the business and how to analyze a good deal. 

@Corey Samuelson if being a realtor and managing your own deals is what you want to do, go for it.

Many investors though (me included) would rather focus on other aspects. I’m happy paying a realtor (or usually not paying since I’m on the buying side) for his expertise and his time. I’d much rather spend my time learning about the investing side that I’m most interested in and better at.

Honestly, if your investing in real estate you don't need a license.  

A license will typically be used for retail residential and commercial but only if your investing in your own market or state. 

If you plan on investing OOS there is really no reason to get your license but if you plan on doing a lot in California then maybe long term it makes sense.

You can sign up and study for your license online.  The test will not be online.

Getting your license is not too difficult.  What you learn is only a portion of real estate.  The course is heavy with real estate legal issues.  From discrimination laws to the laws of representing a client (agency).  

New agents have to get the sales license and hang their license with a brokerage.  A brokers license allows you to run a brokerage business, including being a sole practitioner.

For what you want to do, getting your license is not essential.   

@Corey Samuelson

Good call. You don't need it. I had mine for 1.5 years and it helped with MLS access but it became more of a hindrance because of all the guidelines regarding marketing to off market sellers and disclosures.

@Corey Samuelson

Hi Corey, I felt the same way about a month ago. However, I started reading the book Remtal Property Investing and it opened my eyes about alot of stuff. But throughout my reading, I decided to get my license while still learning the market.

Meaning, I am reading books now, analyzing properties and trying to understand the market and working on my plan on starting my portfolio as well and hopefully by the end of this year to start studying for my RE License.

I think having it will be a great benefit

You’ll figure it out eventually

Don’t forget you’re not required to maintain it forever. Go get it, at least you’ll get involved and have an avenue to get experience, a reason to be around the people you need to learn from, etc. If you don’t like it, let it expire and move on.

@Corey Samuelson

It’s not too difficult or expensive to get the license.

There are yearly ongoing costs though . Many brokerages have some kind of monthly fee even if they are a “100% commission “ broker , then association dues too you are looking at a couple thousand a year on the low end .

But commission from even one deal in Southern California is likely to pay for several years of fees.

You’ll also want to hang your license with an investor friendly brokerage . Some brokers aren’t too fond of agents that invest and view it as a potential liability.

@Corey Samuelson this is one of the most common questions that I see repeatedly on this forum. No. A real estate license you zero knowledge of investing. It actually boxes you into the state regulated industry rules and regulations as well as the continued education requirements and board of realtor dues and fees. They make money from your license. You can make offers, close deals, reassign contracts, flip, rehab, hold, etc. without a license.

Hi @Corey Samuelson ,

There is zero upside to you getting your license if you're just going to do your own deals. In fact, it puts you in a worse position because the legal expectations are heightened because you become a "professional".

You are far better off saving your time and money and instead build relationships with expert agents in your area. It will save you money in the long run.