Hi all! I have a few properties in NYC and is thinking about buying more and possibly selling in the next few years. I figured since the real estate agent commission is so high in NYC, I might as well get a license myself and be my own agent when it's time to sell. I speculate that the prices of my properties are only going to go up so I would be saving some money when the time comes. Another reason I want to get the license is I want to buy some single family houses in 2018 so having the knowledge won't hurt.
I did some research and it tells me that I need to take a 75 hours course first, take the exam, then apply for the license. I'm thinking I can also work PT as an agent after that so I would need to find a brokerage to work under.
My questions are: What would you recommend I take the 75-hour educational course with? Does it make any significant difference which program I choose? Are there anything I'm missing in terms of the the steps I need to take to get my license? Are the above reasons sufficient to get a real estate license in the first place in your opinion? Would love to hear what everyone here thinks!
I am not an agent but I think the average Real Estate Commission in NYC is around 6% with 1/4 going to the selling agent, 1/4 going to the selling broker, 1/4 going to the buying agent, 1/4 going to the buying broker.
With that said - you can make around $7,500 on the buy/sale of a $500,000 home or $15,000 on a million dollar home.
Will you be buying homes in NYC in 2018? another benefit is that you can go ahead and see the homes yourself without having to call an agent.
One thing to be wary about is that there are costs associated with being an agent
1) classes + exam
2) possibly monthly fee with broker to be at his brokerage
3) fees to the MLS Systems. Manhattan has its own MLS so you may have to pay multiple fees.
4) Taxes - you are paid as an independent contractor so your net income is subject to income tax and self-employment tax.
5) Continuing education
6) License renewal fees
@Jinyu Shao if you think that being an agent is "IF you list it, the buyers will come" then I don't think think you're aware of all the things that agents have to do to sell a home. There are costs, many costs, associated with being an agent. Marketing the property can be a challenge, as well as showing it. IF you're working a full time job will you be able to perform all the functions necessary to show and sell it? And listing your own home puts you at greater risk with E&O (errors & omission) insurance.
That being said, if you're going to do at least 3-4 transactions per year then I think it's worthwhile to get it. I think that any agent now a days who settles for a 50-50 commission split in NY is giving away too much to their broker, like @Basit Siddiqi mentioned what is customary. Being a good agent is all about networking, not the name of the company you hang your license with. Many agents think that having their name associated with a big name firm will make all the difference, and that name being associated with theirs will have a greater impact upon their success in real estate. I respectfully disagree with it. People believe in other people first and foremost, so don't give up a great split with your broker for something that in most cases will never get you a listing or a sale.
BTW Basit Manhattan doesn't have an MLS. It's the wild west of real estate. An organized MLS would devalue the properties so they don't do it.