Should my wife become a realtor?

Question

Hello BP community,

Still new to the site and REI as a whole, though I've come a long way. I haven't made my first investment yet as the goal will be after the new year as soon as it begins to warm up. The question is as stated, should my wife become a realtor while I make my way in to this field? I've read plenty of articles stating why she should and why she shouldn't.

To describe a little more in detail to help with the advice, all investment purchases will be made in my name as I'm the bread winner and our home now isn't even in my name. So I have a solid debt/income ratio. But the whole idea of me beginning to invest in real estate was because she talked to me about leaving her job and going in to realty. My goal as an investor will be to buy and hold properties, paying them off with my current income and inevitably both of us leaving our jobs to do this for a living. I personally do not want her to because I feel I'll need her time and devotion on assisting me as we take this step in to the REI gme. Any feedback is appreciated! Thanks,

Mike Higgins

Account Closed · Answer

@Mike Higgins There are quite a few unanswered questions involved in that. If she wants to sell real estate, well then "sure". If she wants to make real money in real estate investing, then "no". After she gets her license, it could be 6 months before she gets her first check which is split 4 ways. A house selling for $200,000 has a plausible commission of 6% so $12,000 commission. She and the other agent split that so they both get $6,000 - that gets split with her broker so she gets $3,000. (This is Generally the split - there are other comp plans but this one is fairly typical). I am not an agent for those reasons among others. And you can get access to the MLS without becoming an agent yourself. Sounds to me like she simply doesn't like her current job. That's where to focus. What if she did the staging or the "bird dogging" for properties, or some such thing? Becoming an agent means competing with tens of thousands of other wannabe agents (the people who get their licenses but never sell anything). Is she competitive? The really Good Agents work nights and weekends and take time to build their clientele, and Always pick up the phone when it rings.

Mike Higgins · Answer

She's always exceeded wherever she worked because of her work ethic and I think she would do the same here. But it'll be years (or so I'm told) before she starts making a real profit. And by that point I'd like to have acquired a few properties by then and would want her heart in the investing direction. Was just looking to see if there's any real advantage or plus side to have her go in that direction. But in large it's definitely because she doesn't enjoy her current job. Thanks for the input Account Closed

Mike Higgins · Answer

okay thanks for the help @Lynn M. We're heading to an open house tonight for realty so I'm sure I can get some more questions answered there's. Thanks for the help everyone.

Lynn McGeein · Answer

Your state may have specific rules, but all that is required in VA is that I fully disclose my relationship, that I am related to buyer or seller.  I have to do this with any close relative I represent. And when I sell property in my own name, it is FSBO by Owner/Agent.  I am not required to list it just because I am an agent.   The broker she signs with may have extra conditions.

Mike Higgins · Answer

@Lynn M. So there aren't any stipulations on her being the realtor on deals I would make? I could've sworn I thought I read somewhere (even a BP article) that there were certain rules in place if she were to be my realtor on investment properties.

Lynn McGeein · Answer

So what about a compromise?  Let her get her real estate license and work it part-time.  Depending on her current employment, it could work well to start out.   Especially if she can partner with someone with different hours.  If she has nights and weekends available, that is the busiest time for most, anyway.  She could be establishing relationships, gaining knowledge in the field, and the access to the MLS data and ability to view property on your own (with her as your agent) would be very helpful as you build your portfolio.   The money you'd save in commissions using her as your agent may pay for her license and MLS fees, even if she is only part-time.

Charlie MacPherson · Answer

@Mike Higgins If she wants to sell real estate for a living - or at least for her part of your household income, she needs to realize that it takes a lot of hard work.

The last statistic I saw was that as a nationwide average, it takes 90 days from shiny new license to first paycheck.

Those with a lot of hustle will do better, but the thing that stops most agents in their tracks is the fear of making prospecting phone calls.

If she has call reluctance, this is most assuredly NOT the way to go - unless all you want is direct access to MLS.

Ryan Murdock · Answer

@Mike Higgins Becoming an agent is a tough way to replace a paycheck from another job right out of the gate. She may want to see if she can get connected with an existing real estate "team" somewhere. Her splits would likely be less but she'd probably be spoon fed leads which can be a good way to help get started and become established.

Depending on the goals of your RE investing business, having her as an agent can be an invaluable tool. I have purchased properties that I would have missed out on if I had not been an agent myself. When time is of the essence just "getting there first" can land you the deal.

I still do some client representation but even if I stopped that entirely at this point retaining my RE license would be worthwhile simply for my own use. I could not have made that claim when I first started but now several years in it's something I can't imagine trying to operate without.