Worth becoming a part-time real estate agent?

Question

I know there is a lot of discussion posts about this subject, but I would like some feedback from people who are a real estate agent in there spare time (not as their career). I am working on getting my CPA and will follow tax planning as a career. I am always learning and trying to understand as much as a I can, so I have completed the courses and the realtor (sales person) licensee exam in Pennsylvania but I am reluctant on signing with a broker and obtaining my license.

I want to know what experience anyone has with having a real estate license they use only part-time or mostly for their own investment purchases/sales.

Steve Morris · Answer

"Mr Morris, I believe every state requires anagent hang their license with broker..."

OK.  I don't know PA law.  In OR/WA, I'm a principal/managing broker and can hang my own license alone.

Matt Nico · Answer

Andrew,

I just obtained my real estate license in Florida. I got it because I wanted a more in-depth knowledge and understanding of real estate first and foremost. I want to be able to log in to the MLS every morning and see the market in real time, with all the data. I also can go into any house listed at any time, making my own personal buying process more streamlined. And saving the 3% is cool too, but should not be the only reason you do it.

I also have some family members and friends who are going to be buying property shortly so it makes sense for me to be able to help them. There are a lot of crappy realtors out there. I try to be the best (or at least better than the crappy ones, which isnt hard to do). Hope this helps.

Happy Housing,

Matt

David M. · Answer

@Steve Morris

@Andrew Daniels

Mr Morris, I believe every state requires an agent hang their license with broker...

Mr. Daniels, it depends on what you plan to use the and how often.  Remember, you are going to have about $2k’ish in annual fees/dues.  Your broker may want you come to meetings, do floor time (sit the front desk at the office).  If don’t do many of your own transactions, it can be hard to justify the costs of maintaining your license.  Let’s also or forget startup costs such as signs, business cards, etc...

If you plan on making some retail sales, then maybe it will be worth it..  some part time agents in my office out perform some full time agents..

Unless you sign with a broker that is “hands on” (ie providing lots of guidance), you aren’t going to be seeing much of what’s going on.  Agents are independent contractors.  Half the time you are just left to your own devices to work.  “Hands-on” brokers who really manage you will be having you come in for team/mgt meetings and even making assignments.  If you are part time, I don’t think you’ll want that.

Also, for your own deals the E&O insurnace you pay as part of your annual fees won’t cover you since its effectivelya conflict of interest.  Not that you really need it, but if you think that provides a layer of protection, don’t.

I hope that helps.  Good luck

Steve Morris · Answer

"Number one reason to get your license IF you plan on investing in real estate: access to MLS."

Well, kinda disagree.  If PA requires you to have a managing broker supervise you, you can learn how deals get structured and take advantage of their experience.  Saves you from screwing up deals at first.  In addition, he should have E&O insurance.

Max T. · Answer

@Andrew Daniels

If you are doing 2-3 deals per year around the 150-200k price point it is probably worth it.

Basit Siddiqi · Answer

@Andrew DanielsThis is the PA law when it relates to using the CPA Designationhttp://www.pacodeandbulletin.gov/Display/pacode?file=/secure/pacode/data/049/chapter11/s11.8.html&d=reduce

Dorian Weber · Answer

Im a real estate agent in Florida and from an access to the MLS it is solid plus if you find a deal yourself you can be the agent and make the commission which will more than cover the cost of the test/yearly fees

Dont expect to make money from it as a realtor unless you have a bunch of family that will use you. Takes around 3+ years to even remotely start building a business unless you luck out. Average house price is 350k where I am and my first year as an agent I did 3.2mil which is more than 95% plus of agents in their first year do and I still didn't even make that much money after everyone took their cut etc. Second year was a struggle.

Basit Siddiqi · Answer

@Andrew DanielsYou can't call yourself a CPA if you are currently studying to become one...Regarding your question - If you are going to do it full-time, just know that you are competing in a profession where people are doing it 40+ hours.Maybe go in knowing you won't make a lot of money but for a learning experience.

Moises R Cosme · Answer

Andrew,

Number one reason to get your license IF you plan on investing in real estate:  access to MLS.  MLS allows you find property, but more importantly it gives you on demand access to sales information; sales information is the critical factor in making purchasing decisions.  Zillow and other like sites do not offer information that compares to your local MLS.  I hope this helps!!!