Is it common practice to become an agent only to invest

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Russell BrazilBusiness Member
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Real Estate Agent · Washington, D.C. · Member since 2012 · 17k+ posts · 30k+ votes
4y

Its common that people get their license.

It is uncommon that they actually renew it. 


87% of people who get a license do not actually renew it. 

What that tells me is everyone thinks its a good idea, then they dont actually use it enough to justify the costs.

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  • Ronnie Galindo
    Realtor · Napa, CA · Member since 2018 · 112 posts · 77 votes
    4y

    @Irvin W Blouin Jr, this is a big question and one I struggled with initially too. So is it worth becoming an agent? It depends. If you just want to become one to invest with and not practice, then no. Do not become an agent. It costs money (I have payments to the MLS, the association of realtors, my brokerage, etc. so if you are not making money solely as an agent, this is a debt). Also, you'd save 2.5-3% on average but the overall picture can be missed. An agent is your expert in that area. They are the one that negotiates on your behalf and the one that is a second pair of eyes for the transaction. If you get a good agent who deals with investors (and better yet, is an investor themselves) then you have another person who can double check your idea of investing and save you (usually) from making huge mistakes. It would be its weight in gold to find a rockstar agent instead of becoming one, unless you are going to push forward as an agent and sell/buy for others on top of your investing. I am a Realtor and yet, I have an agent (a rockstar one at that) in another market I invest in.

    Good luck and if you have more questions, let me know!

    3Reply
  • Irvin W Blouin Jr
    OP
    Member since 2022 · 3 posts · 0 votes
    4y

    Thank you. This is very useful. 

    0Reply
  • Andrew FreedBusiness Member
    Investor · Worcester, MA · Member since 2020 · 1k+ posts · 1k+ votes
    4y

    @Irvin W Blouin Jr - Read "Sold" by David Greene and you will understand all of the work that goes into being a solid agent. It's a lot of work to be good at it. In this market, you really want a great investor focused agent on your side. If you aren't a practicing investor focused agent, I would highly recommend hiring the job out. Practice makes perfect and if you aren't practicing the craft, it'll probably cost you more money in the long run due to an oversight on your part.

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  • Russell BrazilBusiness Member
    Moderator
    Real Estate Agent · Washington, D.C. · Member since 2012 · 17k+ posts · 30k+ votes
    4y

    Its common that people get their license.

    It is uncommon that they actually renew it. 


    87% of people who get a license do not actually renew it. 

    What that tells me is everyone thinks its a good idea, then they dont actually use it enough to justify the costs.

    [email protected]301-893-4635Podcast Guest on Show #192
    District Invest Group545 Reviews
    WebsiteView Page
    4Reply
  • Irvin W Blouin Jr
    OP
    Member since 2022 · 3 posts · 0 votes
    4y
    Quote from @Andrew Freed:

    @Irvin W Blouin Jr - Read "Sold" by David Greene and you will understand all of the work that goes into being a solid agent. It's a lot of work to be good at it. In this market, you really want a great investor focused agent on your side. If you aren't a practicing investor focused agent, I would highly recommend hiring the job out. Practice makes perfect and if you aren't practicing the craft, it'll probably cost you more money in the long run due to an oversight on your part.

     Thank you

    0Reply
  • Eric Bilderback
    Real Estate Agent · Sisters, OR · Member since 2014 · 1k+ posts · 1k+ votes
    4y

    Thats what I did.  But if I had a good job or a career I was successful in I probably wouldn't have.

    0Reply
  • Matt Ziegler
    Rental Property Investor · Colorado Springs, CO · Member since 2020 · 433 posts · 284 votes
    4y

    @Irvin W Blouin Jr you don’t need to be an agent to buy, and invest. You need an agent on your team to help you be successful. Take action and get started, the agent or not decision can come later. Build your team and build your education, and enjoy the journey!

    Cheers 

    2Reply
  • Steve Milford
    Lender · Vancouver, WA · Member since 2015 · 482 posts · 316 votes
    4y

    Investing is a business. Being a real estate agent is a business. Want to be a better investor? Then become an agent to see both sides of the coin. It is all about perspective. Sometimes business is sucky, and agonizing, but it still is a business.

    I laugh when investors try to tell me how smart they are yet aren't their own agents. Yes, I read lots of reports, talk to lots of people, analyze the market left and write, and YES, I have to pay dues. Yet, I know when things come on the market right now, if I want to see a property, I don't have to "arrange it" with anyone, I just schedule it or call the owner. I get pitched wholesale deals, and I have easier conversations with other agents, title companies, lenders, and people that want to buy and sell. I didn't get my license to make millions - but to learn the business better. If I do one deal a year, it satisfies my dues, so why wouldn't I? I take the fiduciary responsibility very seriously and don't push people to deals. Basically, I treat people how I want to be treated, and I keep getting referrals.  Plus it is an easier way to raise capital for my next deal. And if you don't want to truly do the business of being an agent, when people come to you, you can refer it off for a fee. It is a business. 

    Is it cost-effective regarding time and energy? 1,000%

    1Reply
  • Marc Izquierdo
    Investor · Bristol Borough, PA · Member since 2016 · 135 posts · 53 votes
    4y

    I invested for 3 years without having my license. You definitely don't NEED it. Having an agent was a great benefit in the beginning. I remember one deal specifically (this was our third deal) where he sent us the listing via text before we even saw it on our own portal. He had already scheduled us a showing because he knew what we wanted. When we were writing up the offer, I wanted to write it for $5k less to "get a deal". The market was just starting to heat up in 2020 and he knew there was risk offering under list price. He essentially put it into perspective for me by saying something along the lines of "is saving $5k worth losing the deal?". At the end of the day, we submitted the offer at full ask, got it accepted, and it's one of the best performing properties that we have now. 

    On the flip side, about 6 months after that deal, I got my license. In November of 2021 when the market was super hot, we closed on a flip at a great price. I attribute winning that to being able to see the property come up on the MLS immediately, scheduling a showing immediately, submitting an offer immediately, and directly interacting with the agent. There was no middle man and it made the process run super efficiently and fast. A lot of times, speed is the name of the game.

    At the end of the day, I think that if you plan on doing deals (even 1 a year), you are someone who can speak well to listing agents, and don't mind doing market research on your own, it's a good idea. I like controlling as much of the situation as possible and not relying on anyone else. As for the cost, I pay less than $1k a year which to me is honestly well worth the control.

    0Reply
  • Eliott Elias
    Investor · Austin, TX · Member since 2021 · 9k+ posts · 5k+ votes
    4y

    Depends on what you do and how much time you have. As a full time investor I believe it’s crucial to have your license, can run comps whenever you want and save 3% on the buy and sell. If you work full time it may be worth paying an agent 3% for their services. 

    0Reply
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