Hello again everyone! I'm thinking of getting my real estate license next month and i'm getting into real estate investing to wholesale and eventually start buying rental properties. Would getting my license be beneficial ?
There's quite a few blog posts and forum posts on this topic. It really depends on your long term goals. You do not need a license to wholesale properties (perhaps you do in some states, but not MN). The knowledge is definitely good but there is annual agent fees, MLS fees, continuing education etc.
I recently just got my license to help with investing, mainly for MLS access. You could also get a limited brokers license without taking the classes if you want MLS access. If you just want to obtain a rental property here and there then you probably would not need to have a license and maintain it. So long story short is that it is probably beneficial if you are willing to pay the start up costs and ongoing fees.
Hope this helps!
It depends on the goals that you have set or are setting for yourself. I️ just passed my exam 2 days ago. I’m interested in selling real estate in addition to investing. Ideally, I️ want to use the money from real estate to invest in rental properties. Figure out your WHY and go for whatever it is. I’ll be closing on a rental property next week and I️ have been working with an awesome investor-friendly agent. It’s a win-win in my opinion! Good luck!
Jasmine Benford, Real Estate Agent in VA (#0225233131)
I am planning to get one myself. I feel I can sell my own properties eventually and not have to split the 3%. Same with buying. At the very least to improve my knowledge.
I got mine to supplement my income and also to gain access to the MLS. I like the fact that I can look at past sales in the area for comps and make as many offers (low ones :)) without an agent feel like I'm waisting their time.
Jon Bachman, Real Estate Agent in SC (#104893)
Let me start by saying that I always encourage newer investors to get their license, and here are a few reasons why....First, if you are going to be in the business, consider the license as a valuable tool that you will use in your business to create more business. Yeah, your initial focus may be to wholesale, but sometimes you can get some slow periods in wholesaling, so being able to take on clients and get the commissions from sales will help cushion those slow periods. Once you start to get your name out there, you will get family, friends, neighbors, etc. who may need your assistance and with the license you will be able to help them and generate revenue for your business. Secondly, when you get licensed you learn how to do business the legal way, and by my constant encounters with some of the wholesalers/investors doing business these days, its clear they never learned what the actual laws are. Since it seems as if you are new to the business, you don't want to set a bad reputation for your name by doing bad business. That is the surely the best way to hinder your business's growth before you even get going. Lastly, but certainly not least, having a license allows you to pursue properties listed on the mls. As a licensee, you can ethically wholesale properties on the mls, which they won't teach you directly in the licensing course, but with the license you can team up with a mentor who can show you how to do this. As an investor, and especially wholesaler, you will want to put in lots of offers, and sometimes this can be a challenge trying to find an established agent to do this for you. With you being licensed, you can get access to listed properties, draft and submit your own offers, all without having to work around someone else's schedule. There is so much value in that alone that I cannot stress enough here. Someone mentioned the fees associated with carrying a license on a annual basis, and yes, these can run around $2-3k/yr. If you are unable to generate at least $3k in revenue in an entire year, then the license definitely is not the problem. I am in the Chicago market, but always available to help within my capacity, so feel free to reach out. Good luck, and see you around the site.
Larmon Cummings Jr
Just about every person has once or twice obtained a license for the sake of looking, looking and looking.
I appreciate your response, it was helpful and I did not know about the limited broker license option, something I am definitely going to check out to weigh my options. Thanks for the help!
Wow thats great congratulations! I Definitely agree sounds like a win win, and extra knowledge and income! Thank you!
I agree that was one of the reasons I also think getting my license would be beneficial, sale the properties myself.
Thank you for bringing up some very valid points there. It Sounds like by me getting my real estate license,not only will i have access to MLS but it will open me up to many opportunity in the real estate world! Also a good point being able to learn the legal way of doing things is exactly the route I want to go. I plan to make a career out of this and its important to start the right way! I appreciate the feedback, it was very useful!
I recommend getting your license but also suggest you get a W2 job. I had a license for years and loved it, I primarily did real estate at night and on the weekends while working in a career of some sort. I went into the office for big meetings or when I could. I learned a ton. Now I invest. You'll want a W2 income so banks can easily say yes to you.
I appreciate that advise, that is a good point made. Do you have any tips for getting started as a real estate agent?
If you're looking to wholesale it might hurt you. More disclosures you have to make/ more procedures you have to follow.
I specifically don't have a licence for that reason.
I recommend it. I'm in the class right now just for the reasons others have discussed. I wish you well.
@Stephanie Lewis Yes, spend your time and energy working with people with money. :) I know that sounds dumb, but it is not. I once landed an insane deal for a client and she backed out because she needed like 6k to close instead of the 4k that she had budgeted for. If you can't find 6k for an amazing home with a ton of equity, you shouldn't be buying a house. I spent 2 months with her. Also, tell your clients when you are available, you aren't on strings so they don't get to run you around. Tell everyone what you do. Twice. Talk about real estate all the time. No one can use you if they don't know what you do. Also, knock on doors. When we were 12 we weren't afraid to sell chocolate. Why are we afraid to land clients? If I started again as a licensed agent today, I would go to high end apartment complexes (prices where you know people should be owning) and say, "Hi, I'm ..., I can't help put notice you rent an expensive apartment, I can get you a home for about as much as you pay now, I have a great lender that can get almost everyone approved..."
I sold industrial maintenace lubrication products for about a year, if I used the front door to speak with potential buyers, I would have starved. The secretary would have shood me away even though I offered a great product that could save her company money. Sometimes you have to go around the building to the back entrance to make money. Good luck! The hungry get fed in America.
@Engelo Rumora wrote a good BP post about this here: https://www.biggerpockets.com/renewsblog/2016/04/0...
I agree w/ him that a license is NOT appropriate or necessary for most real estate investors, mainly because it is cheaper, faster, and easier just to use flat fee services.
Here’s a BP post I did that directly addresses the expenses of getting and holding a license in California: https://www.biggerpockets.com/blogs/9561/55035-what-are-the-costs-and-steps-to-a-california-real-estate-license
Jon Minerick, Real Estate Agent in CA (#01523060)
Thank you everyone for your advice, definitely want to weigh out my options before registering for the upcoming class. All these are great points I will take into consideration! :)
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