As a REI, would it be beneficial to acquire a RE license?

Question

I'm looking to invest in rentals. What would be some pros and cons to getting a real estate license?

Terrance Clark · Answer

@Matthew H. Hey Matthew one instant pro of having your license along with rentals is being able to get the most exposure through the mls when you have a vacant unit.

I would say more specifically only get a license if it your goal to build a business full of product and services in real estate.

I have my license and one thing I really enjoy because of my brokerage is how my business is vertically integrated with multiple income streams!

Check this out terranceclarkre.com/why-exp

Ben Zimmerman · Answer

It depends on the scale of your business.

If you plan on buying one property every 5-10 years like the majority of BP members, then I say it isn't worth your time.  The time it takes to take the class, as well as the yearly refresher classes that are typically required, and the fees involved in becoming licensed and staying licensed probably doesn't make it worthwhile if you only plan on sporadically purchasing a new property.  Not to mention that even though you are technically licensed, you are still very inexperienced which can make it painful to try to represent yourself if you are only doing this once every few years.

However if you are purchasing something on a somewhat regular basis then this can be phenomenal.  You don't need to wade through all of the crappy agents before you find one that fits your needs.  You can do your own research, pull your own comps, have MLS access whenever you want it, and schedule viewings yourself without needing to coordinate your schedule with your agent.  Obviously representing yourself also has the financial aspect of being able to save multiple thousands of dollars both when you buy, and when you sell.

Joel Calkins · Answer

There are many schools of thought on this subject but here's mine.

This really depends on your goal as an investor and how you are going to reach those goals. Most people say becoming a real estate agent isn't necessary because there are plenty of agents who are amazing at their job. Essentially this will allow you to focus on your end of the deal, whether that's rehab, management, or anything you can bring to the table.

Personally, I have decided to pursue my license to gain more insight into the real estate world because what's wrong with having more knowledge?

Feel free to contact me with any of your REI questions. Good luck Matthew!

Account Closed · Answer

@Steve K.

Could you give me an example of an exclusive that you signed off on? I'm totally for showing my commitment to these folks, I've thought of throwing in a bonus for the agent if they find me these deals and I close on them. Is that something you're talking about?

Account Closed · Answer

@Steve K.

Thanks Steve! I think you're right about gaining more knowledge by working with Agents first. I just need to find one that is willing to show me the ropes. I've already had one agent fall out because I told them I wanted to look for distressed properties and use the BRRRR strategy. It felt like I was speaking another language when talking to them about the strategy. Lots of awkward silences. Oh well, just have to keep searching.

Account Closed · Answer

Thanks, Calvin! That makes a lot of sense. I'm just starting out in investing, so I'll probably stick with using an agent at first, as I gain more knowledge, then go from there. It's too soon to know how things will play out in my story until I actually start getting my feet wet.

Account Closed · Answer

Whoa! That looks pretty cool, Terrance. Are there live events going on in that virtual world?

Account Closed · Answer

Thanks for the response, Ben! So, I'm in a position to implement the BRRRR strategy and buying multiple properties in a year could add up in agent costs. But, you are spot on about my inexperience. Hopefully I can learn the business through my Realtor; then get my license.

Account Closed · Answer

Thanks for the tip, Joel!

Steve K. · Answer

Colorado has a standard form we use called the Exclusive Buyers Agency Agreement. TREC probably has something similar.

As a REI, would it be beneficial to acquire a RE license?

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