Real Estate Investor and Real Estate Agent. Best balance.

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Real Estate Investor and Real Estate Agent. Best balance.

Ernest Chamblee
Real Estate Agent · Colorado Springs, CO · Member since 2017 · 74 posts · 29 votes

Good day BP community, hope all is well! 

I would like to discuss the balance of being an agent-investor, or investor-agent (whichever way you identify).  Many investors pursue the license for it's perks, and many agents begin investing once they become comfortable with the transactions. To those active on both sides:

Is anyone in the BP community successfully operating two businesses, a full on Real Estate Salesperson Business and an Investing business (wholesale, flips and holds)?

Which did you start with; Investing or Agent?

What challenges have you faced that you attribute to the difference in businesses?

If you had to choose just one to operate, which would it be?

Recently passed State and National exams, and would appreciate some perspective. Thank you!

Ernest 

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Leslie Bandy
Oakland, CA · Member since 2011 · 55 posts · 28 votes
9y

I am both an investor (buy and hold) and agent. It's a great combination and drives a huge amount of my business and gives me a great skill-set to work with. 

I started as a homebuyer in the competitive, expensive Bay Area market, then as an investor, then became an agent. My brokerage trains to do business with investors which is relatively rare but why I joined.  My investor training also helps with my work with "retail" buyers and sellers.

Far from putting up roadblocks, I find that doing both gives me a great transferable skill set that works on both sides.

I couldn't operate just one but the long term plan is to continue investing in buy and holds as a retirement plan.  

I hope that helps but feel free to reach out if I can be of any help.

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  • Leslie Bandy
    Oakland, CA · Member since 2011 · 55 posts · 28 votes
    9y

    I am both an investor (buy and hold) and agent. It's a great combination and drives a huge amount of my business and gives me a great skill-set to work with. 

    I started as a homebuyer in the competitive, expensive Bay Area market, then as an investor, then became an agent. My brokerage trains to do business with investors which is relatively rare but why I joined.  My investor training also helps with my work with "retail" buyers and sellers.

    Far from putting up roadblocks, I find that doing both gives me a great transferable skill set that works on both sides.

    I couldn't operate just one but the long term plan is to continue investing in buy and holds as a retirement plan.  

    I hope that helps but feel free to reach out if I can be of any help.

    3Reply
  • Ernest Chamblee
    OP
    Real Estate Agent · Colorado Springs, CO · Member since 2017 · 74 posts · 29 votes
    9y

    Thank you very much for the response and perspective @Leslie Bandy !  Really cool your brokerage cross trains for investor clients.  I appreciate your time. Do you run  active marketing campaigns in your area, or pursue the worthwhile deals as they come? Sorry, I bet I will have more questions. lol

    Ernest 

    0Reply
  • Jay HinrichsBusiness Member
    Real Estate Consultant · Summerlin, NV · Member since 2014 · 45k+ posts · 66k+ votes
    9y

    for me I started as a broker to earn money to become an investor. although was really never much of a landlord investor more of a developer and flipper and HML.

    I know there are some that create a long term wholesale business.. however I don't see that as a long term gig for most like brokerage can be.. simply because on the seller side once you sold something you generally are done there are no referrals coming from those folks. 

    My wife is a 33 year veteran and 95% of her business has been referral the last 20 plus years.. she spends literally zero on marketing although many top producers like her do spend a good amount on marketing.. but in wholesaling its constant you must be spending money at all times. 

    and it totally depends on the market but she closes 10 million plus a year for as long as I can remember.. last year she did just under 16 million.. with again not more than paying her license fee's and some flyers and other minor things. I suspect to buy and sell or wholesale 16 million a year one would have to spend a pretty penny to generate that kind of volume. and in low value areas that would be 300 plus homes a year.. so there are some that do that or close.. but that is no way the norm on the wholesaling side. 

    I just see brokerage as a life long professional business I see wholesaling as simply a form of private investing.. and one that is starting to be regulated out of existence in many markets. 

    We have never been much of a buy and hold family we are more buy value add flip... however we sell a ton of property to those that want to be landlords and are happy to do that.. 

    Podcast Guest on Show #222
    JLH Capital Partners51 Review
    WebsiteView Page
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  • Ernest Chamblee
    OP
    Real Estate Agent · Colorado Springs, CO · Member since 2017 · 74 posts · 29 votes
    9y

    Amazing feedback @Jay Hinrichs. Thank you very much for the response and details. Very cool stuff.  You and the wife have done well for such a long stretch.  Appreciate the perspective.  

    Professional perspective is what prompted the question.  When I began wholesaling it felt like a grind, like a hustle (which I love), but as I talk and interview with brokerages it feel like an actual career shift, which is a good thing.  

    I will take into consideration you words, and may have some follow up questions thoughts as I continue stepping on this journey! 

    Thank you.

    Ernest

     (great episode on the podcast btw, appreciate your response)

    0Reply
  • Jay HinrichsBusiness Member
    Real Estate Consultant · Summerlin, NV · Member since 2014 · 45k+ posts · 66k+ votes
    9y

    sure thing just our point of  view ... many will have a different attitude or perspective.. you have to follow what you want to do and are comfortable with.   Real estate in any discipline is not easy.... I have owned 3 brokerages over the last 40 years..  burn out for agents is a full 50% and what I see from wholesaling is a 90% or better burn out or failure rate.. there simply is not enough homes to wholesale for all that want to do it. But there is plenty to be sold on normal open market.. big difference. 

    Podcast Guest on Show #222
    JLH Capital Partners51 Review
    WebsiteView Page
    2Reply
  • Jeffrey Hotz
    Real Estate Professional · Dublin, OH · Member since 2013 · 251 posts · 165 votes
    9y
    I'm both a broker and full time investor as a Franchisee of HomeVestors. I'm going to speak specifically about evaluating opportunities where someone reaches out to you to buy their home through your advertising. Often it's really easy for investors to go into an appointment and present myriad options for the seller from cash offer to wholesale to listing. Obviously the margin quickly diminishes and often you may have left tens of thousands on the table by presenting a listing. Generally just figured I'd comment and advise against getting antsy and killing a potential larger margin opportunity. I think my oldest lead where they said they were going to list was 3 years ago, so you simply can't trust what a seller is telling you. Unfortunately you may lose some listings, but I'd rather lose some 2/3k commissions checks for a 30/40k+ closing wire.
    0Reply
  • Jeffrey Hotz
    Real Estate Professional · Dublin, OH · Member since 2013 · 251 posts · 165 votes
    9y
    Oh, I should add that I obviously consider myself an investor first so business model is structured as such.
    1Reply
  • Ernest Chamblee
    OP
    Real Estate Agent · Colorado Springs, CO · Member since 2017 · 74 posts · 29 votes
    9y

    @Jeffrey Hotz Thank you for the response and the information.  I like your, we have options, approach.  HomeVestors has an interesting business model!  How long have you been a franchisee with them?? 

    I franchise a couple Rocky Mountain Chocolate Factory locations, no where near real estate.  My goal is to get into RE more actively, which brought the questions and brokerage interviews.  Thank you again for the response!

    Ernest 

    0Reply
  • Jeffrey Hotz
    Real Estate Professional · Dublin, OH · Member since 2013 · 251 posts · 165 votes
    9y
    Ernest Chamblee that's awesome as my parents were looking into Rocky Mountain! I fear they chose poorly as the Rocky Mountain in their area is going strong and they closed down their most recent franchise. Anyway, I've been with Homevestors around 5 years now and have operated in multiple markets.
    0Reply
  • Leslie Bandy
    Oakland, CA · Member since 2011 · 55 posts · 28 votes
    9y

    @Ernest Chamblee I'm happy to answer any questions you might have. Being both an investor and agent is a good place to be as long as you mind all the liability issues that arise from marketing your own flips (not advised).

    0Reply
  • Jose Castillo
    Flipper/Rehabber · Springfield, MA · Member since 2016 · 641 posts · 204 votes
    9y
    I'm definitely following this post. Great question.
    0Reply
  • Steve Bracero
    Real Estate Agent · Westboro, MA · Member since 2016 · 1k+ posts · 471 votes
    9y

    @Ernest Chamblee

    Great question! I think your first step is to find where you want to hang your license. It really depends on what you are looking for in a brokerage. Are you looking for a mentor or a high split with little help? Training can make or break your first two years in the biz. You don't want to be another statistic which is the 80% plus burn rate after 18 months. 

    0Reply
  • Jonathan GreeneBusiness Member
    Real Estate Consultant · Madison, NJ · Member since 2016 · 6k+ posts · 7k+ votes
    9y

    @Ernest Chamblee - I have been investing since I was very young and learned everything from my dad who did the same. I went through two separate careers before becoming an agent and now I run an RE investment partnership with my sister and run a real estate team, so I am doing both hopefully successfully. If you look at what your goals are, and most on BP have similar goals, and they line up with passive income for life, you will find that being an agent is just a way to feed the beast for most investors. Quicker access, finding deals.

    If I was going to choose between one or the other, it's a no brainer. REI all day long. You can create passive income building a RE team as an agent or just a thriving solo business, but it takes a lot of money in to get a lot of money out and you can't cash-out refi your RE team when you want to upgrade it.

    [email protected]Podcast Guest on Show BiggerPockets Daily 667: 5 Amazing Benefits Multifamily Investments Offer (That Single Family Homes Don’t) by Gino Barbaro
    Zen and the Art of Real Estate Investing59 Reviews
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  • Melissa Kirchhoff
    Ottawa, IL · Member since 2016 · 242 posts · 107 votes
    9y

    First, congrats on passing! 

    Like @Jay Hinrichs, I got into real estate to earn extra income to get into REI. Though I'm not really there yet, I'm so happy I did it this way. It's been such an amazing learning experience. However, I see the two fields not so much the same branch at all. I see them as totally different but things that can complement each other.

    If you're just starting out, I would recommend doing it the way I did, maybe I'm biased, but I think I would be able to look back and recognize if I was wrong. I've learned so much about the demands in my market and working with other investors, tenants, buyers and sellers, is the real deal. You can learn so much and if you can see things from those perspectives, I think it makes you a stronger investor in the future. I guess it's a concept like flipping burgers before you own the joint, it really gets your feet wet.

    1Reply
  • Ernest Chamblee
    OP
    Real Estate Agent · Colorado Springs, CO · Member since 2017 · 74 posts · 29 votes
    9y

    @Steve Bracero

    Thanks for the great response! I think I am getting close to a decision on which brokerage.  I personally appreciate the mentor approach.  Like you said the first two years, even five years seem to be most crucial.  I will keep that burn-out rate in mind and set a good foundation!

    0Reply
  • Ernest Chamblee
    OP
    Real Estate Agent · Colorado Springs, CO · Member since 2017 · 74 posts · 29 votes
    9y

    @Jonathan Greene - Thank you for the insight. Really cool you and your sister are keeping RE a thriving part of the family! I love it, "feed the beast". Being an agent and REI should and often do complement each other, got it.

    Were you an agent with any other brokerage before your own?  Are you two previous careers much different from real estate?  

    And advice to new investors/agents; what is something you wish you would have been told or known when you first started out?

    Appreciate the response and sharing your experience! 

    Ernest 

    0Reply
  • Ernest Chamblee
    OP
    Real Estate Agent · Colorado Springs, CO · Member since 2017 · 74 posts · 29 votes
    9y

    Thank you, @Melissa Kirchhoff ! 

    I appreciate you taking the time to respond.  I can definitely see how the experience would complement the investing.  What advice would you give a new agent?  Are you part of a Team/Group or Solo agent? I have some friends in the Naperville market, not too far from your area.  Do you do any work out of Chicago?  Thanks again for the response, and perspective!

    Ernest 

    0Reply
  • Jonathan GreeneBusiness Member
    Real Estate Consultant · Madison, NJ · Member since 2016 · 6k+ posts · 7k+ votes
    9y

    @Ernest Chamblee - see below

    Were you an agent with any other brokerage before your own? Are you two previous careers much different from real estate? - I don't work for my own brokerage, I work for a Sotheby's affiliate now. I have worked for mainstream large brokerages like Sotheby's, Keller Williams and Berkshire Hathaway. I also tried a stint at a higher split model with eXp, but for me I need to be at a leveraged brand because we do high-end listings on our team and need the brand coverage when battling for those.

    My prior careers were different for sure. I was a prosecutor for 7 years and a criminal defense attorney for 2 and then was involved in the art world with galleries and curatorial work for 5 years. It all helps me now.

    And advice to new investors/agents; what is something you wish you would have been told or known when you first started out? My best advice you will hear all over BP. Find a mentor for being an agent and REI. Nothing will help you get up on your feet faster than a mentor who you can give assistance to in return for learning. Good luck!

    [email protected]Podcast Guest on Show BiggerPockets Daily 667: 5 Amazing Benefits Multifamily Investments Offer (That Single Family Homes Don’t) by Gino Barbaro
    Zen and the Art of Real Estate Investing59 Reviews
    WebsiteView Page
    1Reply
  • Melissa Kirchhoff
    Ottawa, IL · Member since 2016 · 242 posts · 107 votes
    9y

    @Ernest Chamblee - Advice is changing but yes, what everyone else has said and what you've said you'd do already. Have another agent mentor you (bonus points for REI too!) and just keep going. Be in the office as much as possible and listen to everyone and what they do. That was the biggest for me and other new agents I talk to. If one of the top agents in my office knew how much I took from him he'd likely charge me! ;-)

    I'm solo agent. I think team could be great, depending on you and how other people work. But it wasn't the right choice for me, even though sometimes it makes things harder and I'd be great at knocking out some of the paperwork and showings some of our top agents struggle to keep on top of! It's hard to not throw in the towel some days but I'm trying to keep pushing through on my own but I think that's a highly personal decision. Just have your reasons and stick with them!

    And no, not currently. I also work north of Chicago and would like to get my foot in the door there since I have a network, but I struggle to get even the people that really trust me to let someone new list their multimillion dollar house lol. And most of my family lives in Naperville area, so shout out to your friends there, it's a lovely place!

    1Reply
  • Brynn Misener
    Real Estate Agent · Chicago, IL · Member since 2016 · 98 posts · 33 votes
    9y

    Hi @Ernest Chamblee,

       I became an agent after investing for a couple years.  My business partner and I are full time real estate professionals as agents and investors.  We feel that being an agent allows us to be experts in the market and also helps up accomplish our investing goals.  We are always more interested in being investors, but love the ability to also generate income as agents.

    1Reply
  • Huy N.
    Houston, TX · Member since 2013 · 483 posts · 189 votes
    9y

    Thanks for bringing this topic up!

    I would say I am lucky because I have a chance to start out as an investor. This gives me the ability to think like an investor. I have seen SO MANY agents get stuck in the rat race of chasing after the commission check and can never get out of it.

    when I quit my W2 to focus 100% on real. This mind set also help me in the business of "lead-generation" rather than "lead-receiving" when it comes to real estate brokerage.

    When your agent asked you what is "cap rate"....just run lol

    2Reply
  • Ernest Chamblee
    OP
    Real Estate Agent · Colorado Springs, CO · Member since 2017 · 74 posts · 29 votes
    9y

    @Jonathan Greene - Thank you very much for the response, details and great advice.  I appreciate your time and response.  Keep doing great! Thank you. 

    Ernest 

    1Reply
  • Ernest Chamblee
    OP
    Real Estate Agent · Colorado Springs, CO · Member since 2017 · 74 posts · 29 votes
    9y

    @Melissa Kirchhoff  haha. @ "If one of the top agents in my office knew how much I took from him he'd likely charge me! ;-)" lol. 

    Awesome! Thank you so very much.  I appreciate your advice and response. I will keep moving forward and when failure happens I will ensure to fail forward.

    Keep me updated about entering the Chicago market.  I can put you in touch with a few of my friends that are interested in RE, some active and some passive! 

    I wish you much success! 

    Ernest 

    1Reply
  • Ernest Chamblee
    OP
    Real Estate Agent · Colorado Springs, CO · Member since 2017 · 74 posts · 29 votes
    9y

    Hi @Brynn Misener Thank you much for the response.  Investing is what prompted me to pursue the license and what I enjoy most, but as you said being an agent is an opportunity to earn extra income.  On top of that, labels you an expert in the field.  Hadn't thought of that way.  Thank you! 

    I appreciate your answer and look forward to learning more about your successes in Chicago! Research shows a very good market to be in! 

    Within your business, how often does an REI lead flow over into a listing? Or do you prefer to kick those to other agents as a referral?

    Thanks again,

    Ernest

    1Reply
  • Ernest Chamblee
    OP
    Real Estate Agent · Colorado Springs, CO · Member since 2017 · 74 posts · 29 votes
    9y

    @Huy N. Awesome! Thanks for that.  Definitely can see how mindset plays a huge part.  Do you generate more leads as an agent or investor?  Have you ever had an investment deal not go through because you were licensed?  

    "just run" LOL. Will keep your guidance in mind! 

    Thanks again,

    Ernest 

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