I have talked with several investors who advised me to attain a real estate license as a means of gaining access to the MLS and as a means of improving credibility. I am not interested in working as a traditional realtor, and I would much rather leverage a highly-qualified broker/team member. So, two part question..
1. Is there any legal ramifications of serving as a broker and REI? (any extra disclosures when dealing with sellers?)
2. Would you advise a part-time investor who is going to transition to full-time investor within 18 months to pursue a broker's license? I am primarily looking to move directly into multifamily, especially commercial multifamily.
Thank you all in advance. You guys are AWESOME.
Hi Bo and welcome. I mainly am responding because I thought it was cool we have the same last name. Likely no relation but I do have some family members in the military. One of them is Bob and for a split second I thought, maybe that's Bob and he forgot the 'B'.
I don't have a ton of value to offer on your question however we have investigated getting the real estate license as you are discussing because we are primarily investors. Anyways, time constraints have gotten in the way but I did get the feedback that it's feasible and depending on the broker there shouldn't be an issue. They still get a cut of the buyers' commission that you'd have to negotiate with the broker.
Other people will know this better than me, but on your #1 question my understanding is that becoming a broker is like a lot of licensed things - you have to put in the time and get another broker to sign off on your time.
#2 - I would because you can save a lot on commissions over the years depending on the volume you're going to do - and I'd assume that your networking opportunities would be different (not better necessarily) with going the broker route. I'd recommend talking to more people to understand the advantages and disadvantages of that. For me personally I find more intrinsic satisfaction (at least currently) as being more involved in the projects in engineering etc. My assumption would be you'd be rubbing shoulders with more agents as a broker.
Haha. I thought the exact same thing when I read first read your name. I have a cousin named Jim that I was very excited to here from, but not disappointed in the least to learn it was you. I can reach out to him anytime...
Thank you for your input. I agree with all of your listed potential benefits. I'm much more inclined on using my time and resources to become the best investor possible, I would only take on becoming a licensed broker when it becomes clear that will ultimately improve my abilities as an investor.
PS- Are you a "Gable" or a GO-bel? In Southern Indiana we pronounce it Gable. I've heard of it going both ways though.
We pronounce it GABLE, how about you?
One note that I can't remember if I mentioned before - we currently work with an agent that is NOT an investor, or at least assures us that he's not. I guess we buy that he's not a competitor - that may be something to keep in mind however it doesn't sound like you're going to be out working as an agent beyond for your own purposes.
Maintaining a real estate license costs time and money. Its going to be about $5k per year after all is said and done. Most overlook the total cost since it comes in chunks. Mls, board association, sentrilock fees, ce credits, licensing fees, e&o insurance, general business liability insurance etc.
To be a broker you will need to be licensex for 3 years....and I think on the Virginia side of the border there is the caveat that you also have to have been working full time as an agent for those 3 years.
Call Chris Anderson at Exit Realty. PM me for his information
We are also "Gables." Good to know a fellow one.
Hey Bo, it's really not necessary or worthwhile to get your RE license in my opinion. Especially if you plan on investing in different states. @Robert Bergeron is an investor friendly Realtor here in Louisville. His team helps me out with investment property in Kentucky and Indiana. A good Realtor that understands REI principals and knows where the bones are buried as far as where to find good deals and cash buyers in a local market is well worth their weight in gold.
Duly noted. Thank you for the reference.