Should I get my real estate license for flipping?
Orlando, FL · Member since 2019 · 25 posts · 10 votes
Should I get my real estate license for flipping?
Most Popular Reply
Originally posted by @Monte Blackwell:
Read the entire post my friend. By the looks of your photo, I've been doing this longer than you've been alive. CLEARLY, I'm must be doing something right. If you carry a license just so you can get comps, then YES, you are clearly doing something really wrong. Hang in there little buddy, experience will fatten your bank account.
Thanks for setting me straight. I'm not sure what I was thinking by pretending I knew anything about flipping houses.
How embarrassing!!!
52 Replies
Originally posted by @J Scott:
Originally posted by @Syed H.:
Originally posted by @J Scott:
Originally posted by @Syed H.:
Honestly, it's useful but you don't need it.
....
But you do need mls access, you will be pulling comps all the time.
In many states, the only way to legally get access to the MLS is to be a licensed agent, broker or appraiser.
Legally? It's not illegal to have MLS access if you aren't an agent. It might be against the MLS's rules, but not illegal.
Yes, I'm sorry... I misspoke.
But, it sounds as if we're in agreement that your assertion that you need MLS access but you don't need your license makes no sense in many states.
yup. Definitely need MLS access if you do more than a few flips a year. I look at way too many properties every year to not have it. It's not as simple as "knowing your market". My markets varies a lot from $350k starter homes to $2m luxury McMansions. Numbers these days are very tight. Having your ARV be accurate is more important than ever.
- Rental Property Investor · Miami, FL · Member since 2018 · 110 posts · 113 votes7y
Hi Terri,
I too invest in Orlando Fl and love to see how you're planning out your business!
Personally, I find it very useful to not be a real estate agent. Other real estate agents react "better" when I mention I am an investor and not an agent, sellers from off market properties are always more willing to discuss a sale when I mention the same fact. I feel like not being an agent is a negotiation tactic in itself.
On the other hand, having your license can come in handy for acquiring deals or information from the mls quicker, sometimes it takes me days to know that a property is already under contract or other important information. For flips, you could list the properties yourself and either keep that commission or remove it from your expense items. If your plan is to eventually do this full time, being a real estate agent is a great way to make money that "pays the bills" and also provides a great advantage to finding great flips.
- 7yJay HinrichsBusiness MemberReal Estate Consultant · Summerlin, NV · Member since 2014 · 45k+ posts · 66k+ votes
Originally posted by @Syed H.:
Originally posted by @J Scott:
Originally posted by @Syed H.:
Honestly, it's useful but you don't need it.
....
But you do need mls access, you will be pulling comps all the time.
In many states, the only way to legally get access to the MLS is to be a licensed agent, broker or appraiser.
Legally? It's not illegal to have MLS access if you aren't an agent. It might be against the MLS's rules, but not illegal.
I suppose you wont get arrested.. but the offending real estate agent/broker at least in our MLS system OR WA is subject to a 20k fine and expulsion.. keep in mind no one wants crooks or thieves having access to the private showing remarks etc.
- 7yJay HinrichsBusiness MemberReal Estate Consultant · Summerlin, NV · Member since 2014 · 45k+ posts · 66k+ votes
Monte this is a little harsh.. Mr. J Scott is a premier flipper and he wrote one of the only books on real estate I actually read.. I don't think he has to worry about hanging in there :)
I do get your point though.. its hard to be a full service broker and a flipper.. that is tough without staff..
However for a high volume flipper builder etc.. having your own real estate company license is a critical component if nothing more than control but also finance.. Take our household for example I am a broker but don't use it. My wife is a retail broker. and she sells all our properties in this market which in 2018 was about 20 million.. now if we give that business to another agent that's at least 400k we don't get.. all for paying a few grand and having total control of the project.
So it really depends on your scale and what your doing.. in other markets we are in.. and we are in a number of them we of course hirer agents to work for us.. and bring us deals.. just like most do.
One reason I owned a brokerage was especially as it related to new agents every deal that came in the door I got first shot at.. I could care less if the brokerage made money. ( and it did not it broken even at best).. But that newbie handing me a deal that could make us 50 to 500k that's what its all about. And unless your in your mid 80s and started at 18 you have not been doing this longer than I have been alive :) tongue in cheek.
Originally posted by @Monte Blackwell:
Read the entire post my friend. By the looks of your photo, I've been doing this longer than you've been alive. CLEARLY, I'm must be doing something right. If you carry a license just so you can get comps, then YES, you are clearly doing something really wrong. Hang in there little buddy, experience will fatten your bank account.
Thanks for setting me straight. I'm not sure what I was thinking by pretending I knew anything about flipping houses.
How embarrassing!!!
Originally posted by @Monte Blackwell:
If you carry a license just so you can get comps, then YES, you are clearly doing something really wrong. Hang in there little buddy, experience will fatten your bank account.
Btw, I never suggested that anyone should get their license just to get access to comps.
Here are just a few of the reasons I've chosen to get licensed in several states:
- Getting access to listed properties without having another agent present;
- Getting information about property condition through MLS pictures;
- Getting information about seller motivation through MLS private remarks;
- Having the ability to communicate directly with my buyers' lender;
- Having the ability to communicate directly with my buyers' appraiser;
- Having the ability to communicate directly with my buyers' inspector;
- Having the ability to sweeten an offer by passing my commission to the other party's agent;
- Having the ability to submit offers on HUD properties without an intermediary;
- Having the ability to print potential comps for appraisers to encourage a strong appraisal;
- Getting access to disclosure statements from previous sales;
- Getting access to price change history on properties I'm considering purchasing;
- Providing negotiating leverage when the other party is represented;
- Providing the ability to negotiate short sales (in some states) and submit short sale offers directly to the lender.
- 7yJay HinrichsBusiness MemberReal Estate Consultant · Summerlin, NV · Member since 2014 · 45k+ posts · 66k+ votes
Originally posted by @J Scott:
Originally posted by @Monte Blackwell:
If you carry a license just so you can get comps, then YES, you are clearly doing something really wrong. Hang in there little buddy, experience will fatten your bank account.
Btw, I never suggested that anyone should get their license just to get access to comps.
Here are just a few of the reasons I've chosen to get licensed in several states:
- Getting access to listed properties without having another agent present;
- Getting information about property condition through MLS pictures;
- Getting information about seller motivation through MLS private remarks;
- Having the ability to communicate directly with my buyers' lender;
- Having the ability to communicate directly with my buyers' appraiser;
- Having the ability to communicate directly with my buyers' inspector;
- Having the ability to sweeten an offer by passing my commission to the other party's agent;
- Having the ability to submit offers on HUD properties without an intermediary;
- Having the ability to print potential comps for appraisers to encourage a strong appraisal;
- Getting access to disclosure statements from previous sales;
- Getting access to price change history on properties I'm considering purchasing;
- Providing negotiating leverage when the other party is represented;
- Providing the ability to negotiate short sales (in some states) and submit short sale offers directly to the lender.
one thing I like about our MLS system there is a history tab very easy to get to .. you get the listing history back for 10 years or so.. you can follow price reductions.. sale fails you know the falling knife this is huge in negotiation.. plus there is a map tab click on it and the map comes up instantly.. I am a map guy.. now we also have property radar which is one cool tool.. but MLS access simply makes us money..
- Rental Property Investor · Mcallen, TX · Member since 2013 · 37 posts · 12 votes7y
Mr Hinrichs,
1. One sarcastic comment deserves another.
2. Writing a book means nothing to me.
3. You chiming in and offering your opinion is no different that me offering mine. I suggest we all stay in our lane.
4. Both of you made it all about you and your dealings and forgot about the original poster. Everything I commented on was for her benefit not for yours. Mr Scott turned it to me and questioned my opinion. I responded accordingly.
5. Now you have decided to do the same.
6. You wrote 5 or 6 paragraphs about you and your dealings which has nothing to do with the original poster.
7. My response to the poster was for her benefit not for you two to try and pick me apart.
8. Subtle sarcasm is not hard to read. I picked up on it and responded, which now makes you feel compelled to fire back me. I'm not thinned skin.
9. I could go on but I'll leave you with this. Probably not the best idea to insert yourself in the middle of two people debating. It's not a humble move but an elementary one.
It's apparent that my posts weren't read in its entirety, otherwise we wouldn't be here in the first place.
Originally posted by @Monte Blackwell:
Mr Hinrichs,
1. One sarcastic comment deserves another.
2. Writing a book means nothing to me.
3. You chiming in and offering your opinion is no different that me offering mine. I suggest we all stay in our lane.
4. Both of you made it all about you and your dealings and forgot about the original poster. Everything I commented on was for her benefit not for yours. Mr Scott turned it to me and questioned my opinion. I responded accordingly.
5. Now you have decided to do the same.
6. You wrote 5 or 6 paragraphs about you and your dealings which has nothing to do with the original poster.
7. My response to the poster was for her benefit not for you two to try and pick me apart.
8. Subtle sarcasm is not hard to read. I picked up on it and responded, which now makes you feel compelled to fire back me. I'm not thinned skin.
9. I could go on but I'll leave you with this. Probably not the best idea to insert yourself in the middle of two people debating. It's not a humble move but an elementary one.
It's apparent that my posts weren't read in its entirety, otherwise we wouldn't be here in the first place.
Between Jay and myself, we have been helping people on this forum for a decade. We have 45,000 posts between us and we speak and help people in a national level. We have thousands of deals between us under our belts, and we both are in a financial position where we are no longer doing this because we need the money. Jay spends more time doing charity work than most people here spend doing real estate. And between us, we've probably partnered on eight figures worth of deals with other people on this forum.
Feel free to insult and criticize me all you want. But, if you're going to take jabs at Jay, I will point out that you are well out of your league. I'd be willing to bet a lot of money that he's done single deals that are larger than all the deals you'll ever do in your life put together. I would also be willing to bet large amounts of money that he has helped more people in the past few months than you will help in your entire career.
That's said, do what you want. But just be aware that criticizing Jay on this forum isn't going to get you any points...though I'm guessing you won't be here in a few weeks anyway, while Jay will still be doing what he's doing helping people be successful in this business.
Have a great day!
- Flipper/Rehabber · Member since 2018 · 3 posts · 0 votes7y
@Terri Hollinsworth
Hello Terri!
Glad your business is moving forward. To answer your question, I would definitely recommend getting your RE License. I got mine and I use what I learned in the classes every day and I will be able to sell my own property and save more money. When you have a license you can access more software and you have an office of people who want to see you win.
I hope that helped! Have a great weekend.
SEBY
ViRu Development
KW Clinton
Great thread... original poster has to be thrilled. You have 2 of the biggest hitters on this entire site chiming in and it is pretty rare to find more knowledge than you can with those two plugged in. Kudos to @Jay Hinrichs and @J Scott for contributing... as always. They are both showing you what advantages getting a license could get you.
- Rental Property Investor · Mcallen, TX · Member since 2013 · 37 posts · 12 votes7y
My only regret about bigger pockets is bumping into to you and responding to you.
- 7yJay HinrichsBusiness MemberReal Estate Consultant · Summerlin, NV · Member since 2014 · 45k+ posts · 66k+ votes
Originally posted by @Rich S.:
Great thread... original poster has to be thrilled. You have 2 of the biggest hitters on this entire site chiming in and it is pretty rare to find more knowledge than you can with those two plugged in. Kudos to @Jay Hinrichs and @J Scott for contributing... as always. They are both showing you what advantages getting a license could get you.
they do call it bigger pockets and many who are on this site wish to scale their business's . we see it all the time with the landlords
IE hey I went from zero to 50 doors in 37 days type of posts and those excite and stimulate those just getting into the business.
So I don't think its not appropriate to talk about other facets of the business and how folks have scaled those. Many of the biggest players in the industry are not even on BP.. IE all the hedgefunds and hedgefund managers that dominate many markets for distressed assets.. IE try to buy a foreclosure in Vegas for instance..
Any way I just thought Monte's post and pot shot @?jscott was rude.. and not necessary.. its OK to have contrarian views we all have them. Like myself I am very contrarian on low value rental assets IE D class low C class.. But thousands still buy them. which is fine..
we are all entitled to our opinions..
- Rental Property Investor · Mcallen, TX · Member since 2013 · 37 posts · 12 votes7y
Originally posted by @Jay Hinrichs:
Originally posted by @Rich S.:
Great thread... original poster has to be thrilled. You have 2 of the biggest hitters on this entire site chiming in and it is pretty rare to find more knowledge than you can with those two plugged in. Kudos to @Jay Hinrichs and @J Scott for contributing... as always. They are both showing you what advantages getting a license could get you.
they do call it bigger pockets and many who are on this site wish to scale their business's . we see it all the time with the landlords
IE hey I went from zero to 50 doors in 37 days type of posts and those excite and stimulate those just getting into the business.
So I don't think its not appropriate to talk about other facets of the business and how folks have scaled those. Many of the biggest players in the industry are not even on BP.. IE all the hedgefunds and hedgefund managers that dominate many markets for distressed assets.. IE try to buy a foreclosure in Vegas for instance..
Any way I just thought Monte's post and pot shot @?jscott was rude.. and not necessary.. its OK to have contrarian views we all have them. Like myself I am very contrarian on low value rental assets IE D class low C class.. But thousands still buy them. which is fine..
we are all entitled to our opinions..
I don't think she needs to get her license for her first deal. Not trying to sell anyone a pipe dream. There is a lot of money she could be saving for her first few deals. My comment or opinion did not warrant all of this.
- 7yJay HinrichsBusiness MemberReal Estate Consultant · Summerlin, NV · Member since 2014 · 45k+ posts · 66k+ votes
Originally posted by @Monte Blackwell:
Originally posted by @Jay Hinrichs:
Originally posted by @Rich S.:
Great thread... original poster has to be thrilled. You have 2 of the biggest hitters on this entire site chiming in and it is pretty rare to find more knowledge than you can with those two plugged in. Kudos to @Jay Hinrichs and @J Scott for contributing... as always. They are both showing you what advantages getting a license could get you.
they do call it bigger pockets and many who are on this site wish to scale their business's . we see it all the time with the landlords
IE hey I went from zero to 50 doors in 37 days type of posts and those excite and stimulate those just getting into the business.
So I don't think its not appropriate to talk about other facets of the business and how folks have scaled those. Many of the biggest players in the industry are not even on BP.. IE all the hedgefunds and hedgefund managers that dominate many markets for distressed assets.. IE try to buy a foreclosure in Vegas for instance..
Any way I just thought Monte's post and pot shot @?jscott was rude.. and not necessary.. its OK to have contrarian views we all have them. Like myself I am very contrarian on low value rental assets IE D class low C class.. But thousands still buy them. which is fine..
we are all entitled to our opinions..
I don't think she needs to get her license for her first deal. Not trying to sell anyone a pipe dream. There is a lot of money she could be saving for her first few deals. My comment or opinion did not warrant all of this.
agreed one deal not worth the time.. but if she is looking to scale it could be.. also don't sell short the benefits of having a license in many markets top realtors make serious money.. and flipping is just another job .. were as being an agent you don't take downside monetary risk.. you get paid whether the project makes money or not.. Look at the big brokers who set up short sale teams coming out of the GFC those folks killed it.. routinely making a million a year or more in commissions.. Not all real estate agents starve.. :) But of course many do. its just like most things 20% of agents make 80% of the revenue I know that to be the case in the real estate brokerages I have personally owned.
- Orlando, FL · Member since 2019 · 25 posts · 10 votes7y
@Jay Hinrichs Thank you for your responses! It's good to hear about those tools on the MLS.
@J Scott All of the benefits seem to outweigh the cost of getting my License.
I’d really like to commit to being successful in real estate and I’d like to have all of the tools available. I even had a conversation last night at work with some local brokers and one of them being wholesale. They said the first thing I should do is get my license.
Hey maybe I’ll find my first deal and by the time I’m ready to flip it I will have my license and be able to sell it myself!
I know it’s not necessary for my first flip however I have learned a lot just putting the question out here!
Thanks for all the feedback everyone who has replied! This post has gotten WAY more attention than I anticipated! haha.
Originally posted by @Monte Blackwell:
Originally posted by @Jay Hinrichs:
Originally posted by @Rich S.:
Great thread... original poster has to be thrilled. You have 2 of the biggest hitters on this entire site chiming in and it is pretty rare to find more knowledge than you can with those two plugged in. Kudos to @Jay Hinrichs and @J Scott for contributing... as always. They are both showing you what advantages getting a license could get you.
they do call it bigger pockets and many who are on this site wish to scale their business's . we see it all the time with the landlords
IE hey I went from zero to 50 doors in 37 days type of posts and those excite and stimulate those just getting into the business.
So I don't think its not appropriate to talk about other facets of the business and how folks have scaled those. Many of the biggest players in the industry are not even on BP.. IE all the hedgefunds and hedgefund managers that dominate many markets for distressed assets.. IE try to buy a foreclosure in Vegas for instance..
Any way I just thought Monte's post and pot shot @?jscott was rude.. and not necessary.. its OK to have contrarian views we all have them. Like myself I am very contrarian on low value rental assets IE D class low C class.. But thousands still buy them. which is fine..
we are all entitled to our opinions..
I don't think she needs to get her license for her first deal. Not trying to sell anyone a pipe dream. There is a lot of money she could be saving for her first few deals. My comment or opinion did not warrant all of this.
I don't think anyone here suggested that she necessarily should.
In my first response, I provided an article that lists all the pros AND CONS of getting/having your license and then I pointed out that I generally like the idea of having a license if you're going to make a business of this.
Again, just my take, and I recognize that not everyone agrees. And the license question isn't a one-sized-fits-all answer anyway.
That said, note that this entire "debate" started when I asked you where you got your comps and how you determined values without your license? That seems like a reasonable question that the OP would want to know the answer to. You said investors don't rely on those things, and I questioned that statement -- in my experience, all successful investors rely on comps and after-repair values. Instead of just answering the question, you decided to attack and insult me instead.
If you can't handle someone questioning you about how you do business without getting nasty and defensive, you might want to rethink your goals for being on this forum. There are lots of ways of doing things, and asking questions (and being confident to give answers) is the best way to learn.
I'll leave it at that.
- Rental Property Investor · Mcallen, TX · Member since 2013 · 37 posts · 12 votes7y
At what point will you just stop? If you want me off the forum I will.
- Specialist · Lombard, IL · Member since 2013 · 11 posts · 5 votes7y
I think she should get her license. It is not a mandatory thing to have but it helps. The information the MLS provides you with for you state makes you life as an investor so much easier. Its easier to comp out properties. When selling your deal you don't have to pay a broker commission which will help make certain houses where the numbers are tight become a deal that would not be.
One more benefit of the real estate license (for some people)...
If you'll be prospecting for off-market deals, you'll sometimes find sellers who aren't interested in selling at an investor price, but who may be interested in getting their property listed for retail sale. When you're licensed, you have the opportunity to pass that customer to another agent in return for a fee or percentage of the commission.
- Realtor · Paramus, NJ · Member since 2019 · 71 posts · 35 votes7y
Think it makes a lot of sense to get your license if you do flips. I recently just got mine so I’ll let you guys know how it works out in the next year or two.
- Flipper/Rehabber · Roseville, MN · Member since 2018 · 73 posts · 38 votes7y
@Terri Hollinsworth
I have done a couple flips and I have an awesome agent. It makes sense to get a license at some point but finding a good RE agent to look for deals for you and make offers for you and sometimes even go look at houses for you is super beneficial because you can spend your time doing something else. Real estate agents are awesome partners to have so imo you should be doing both. Find a good RE to help you with your first deal(s). Make sure they are a REI agent and not just a residential RE agent, they are not created equal. A RE with flip experience is way helpful.
Then decide if you want to get your license and to be looking for everything yourself. Also, the MLS is a good place to find deals but if you want to be doing high volume of flips, you will not be able to rely on the MLS only for your deals.
Just my opinion :) Whatever you decide, do what’s right for you and not what everyone else thinks you should do :)
Happy flipping!!
- Real Estate Agent · Member since 2019 · 67 posts · 33 votes7y
Just got my license yesterday, yup: Yesterday!
I am a buy and hold investor but just the savings on restructuring my portfolio make it worthwhile. Plus, I learned a lot of stuff directly useful to my investing. And finally, it allows me to diversify my source of income as needed. That's a lot of stuff on the plus side.
On the minus: it takes time and dedication to go back to school: I did it in VA which is petty selective. Most importantly, you have to be legally savvy as you can be sued since you're now presumed better informed in RE transactions.
The pluses outweigh the minuses in my view.
- 7yJay HinrichsBusiness MemberReal Estate Consultant · Summerlin, NV · Member since 2014 · 45k+ posts · 66k+ votes
Originally posted by @J Scott:
One more benefit of the real estate license (for some people)...
If you'll be prospecting for off-market deals, you'll sometimes find sellers who aren't interested in selling at an investor price, but who may be interested in getting their property listed for retail sale. When you're licensed, you have the opportunity to pass that customer to another agent in return for a fee or percentage of the commission.
Referral fee income pays for a few of our nice holidays a year.. good point.. and its just an email there is nothing more profitable on the planet than a 1 minute email referral that ends up being a 5k to 15k check ? that's the reason I keep my license in CA active .. And that is how all the turn key marketing companies make their money ( if they are doing it legally) referral fees
And for wholesalers to me its just the HIEGHT of stupidity not to be able to list properties or get referral fees.
I remember one post on BP nice young couple from Salida LA ( just over the lake from N O they spent all this money on direct mail and were chronicling there efforts on BP and within a few months they had referred no less than 6 sellers to their agent friend for no compensation.. and you don't see them on BP anymore I suspect they flamed out like 95% of wholesalers do.. spent all that money on direct mail only to give the business away.. just weird to me.
- 7yJessie ReddPro MemberFlipper/Rehabber · Raleigh, NC · Member since 2018 · 57 posts · 26 votes
@Terri
If you are only going to flip one or two I wouldn’t do it.
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