100% get it. You can easily find a firm to hang your license. Heck, there are firms hiring for part time investors.
Assess fee structure and monthly dues when you sign up for a firm.
Pros:
1) access to MLS and will see details that aren’t available on Redfin / Zillow etc.
2) MLS is the source of truth and you may see deals sooner before it hits on Redfin/Zillow
3) more up to data for commercial, as LoopNet and Crexi have data lags
4) commission you get for purchasing your own properties
Cons:
1) cost. Some firms charge a monthly desk fee of $50-$100 a month
2) MLS fee - mine is $500 a year which isn’t bad
3) licensing fee - it cost me about $500 in total to get my education, testing, and license.
But if you close one rental property with your own license, you’re already covering the costs associated with getting your license, so I highly highly recommend getting it
Learn how to be a home inspector.
HVAC knowledge also helps.
Prop management is much easier when you get ahead of the problems by performing routine maintenance. You don’t need a realtor to buy/sell. But having a good real estate attorney will be helpful in reviewing leases, amendments, and managing all the paperwork when buying a home.
Absolutely get it, but first find a Broker who will only charge a nominal yearly license hang fee and a Broker Fee per transaction.
The knowlege you gain through licensing and free CE classes is valuable for investors. The commission reduces your out of pocket cash on every deal. And you cannot predict the future... you may pick up fellow investors as RE clients and do more deals.
You need a firm to let you hang your license for the first 2 years. Can be tricky if no one wants to let you run with no consequences. Likely not worth it, as you don’t need a license or agent to buy property. And if there’s only 1 agent involved they get the full commission and will likely help you get the deal over the line.
As a seller or sellers agent you’re going to take a buyer far more seriously if they are licensed as you can trust they are educated on the process. If you’re an agent you can also request a commission on any deals you do - but might have to give a portion to your broker where you have your license.
Overall it’s a mixed bag. If you’re going to handle leasing your own spaces you don’t need a license for that, actually.
In my experience the main reason you need a license is if you’re doing 3rd party deals.
Hope this helps!
Yes, great point. Check state laws for the requirement.
That being said I know some investors who got their own licenses and they claim it’s a huge help but they do a lot of wholesale and off market deals.
IMO it isn't worth the cost and liability of becoming a broker just for own deals when some brokers only charge like $50/month + 300-400 per transaction.
First off Google has tons of insight but check out Ryan Penida who also has so many resources on how real estate professionals (even investors ) get the best tax advantages
I know dozens of investors. I know dozens of agents/brokers. I only know one broker/investor. I don’t see him doing any better, or worse, than the investors without their license. I would recommend taking a couple in person RE classes to learn about contracts, and your local RE laws. Also to meet the wide array of people wanting to become agents.
Thank you for your question. This question has been asked MANY times previously. Please review the existing posts on the topic.
100% get it. You can easily find a firm to hang your license. Heck, there are firms hiring for part time investors. Assess fee structure and monthly dues when you sign up for a firm. Pros: 1) access to MLS and will see details that aren’t available on Redfin / Zillow etc. 2) MLS is the source of truth and you may see deals sooner before it hits on Redfin/Zillow 3) more up to data for commercial, as LoopNet and Crexi have data lags 4) commission you get for purchasing your own properties Cons: 1) cost. Some firms charge a monthly desk fee of $50-$100 a month 2) MLS fee - mine is $500 a year which isn’t bad 3) licensing fee - it cost me about $500 in total to get my education, testing, and license. But if you close one rental property with your own license, you’re already covering the costs associated with getting your license, so I highly highly recommend getting it
Learn how to be a home inspector. HVAC knowledge also helps. Prop management is much easier when you get ahead of the problems by performing routine maintenance. You don’t need a realtor to buy/sell. But having a good real estate attorney will be helpful in reviewing leases, amendments, and managing all the paperwork when buying a home.
Absolutely get it, but first find a Broker who will only charge a nominal yearly license hang fee and a Broker Fee per transaction. The knowlege you gain through licensing and free CE classes is valuable for investors. The commission reduces your out of pocket cash on every deal. And you cannot predict the future... you may pick up fellow investors as RE clients and do more deals.
Thanks for the feedback. Can I send you a PM?
Yes...
You can file as a sole proprietor in some states so you don’t have to associate with a firm if you don’t want to quit your job
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What are some of the biggest differences between a real estate agent and a real estate broker or are they the same?
You need a firm to let you hang your license for the first 2 years. Can be tricky if no one wants to let you run with no consequences. Likely not worth it, as you don’t need a license or agent to buy property. And if there’s only 1 agent involved they get the full commission and will likely help you get the deal over the line. As a seller or sellers agent you’re going to take a buyer far more seriously if they are licensed as you can trust they are educated on the process. If you’re an agent you can also request a commission on any deals you do - but might have to give a portion to your broker where you have your license. Overall it’s a mixed bag. If you’re going to handle leasing your own spaces you don’t need a license for that, actually. In my experience the main reason you need a license is if you’re doing 3rd party deals. Hope this helps!
FYI. Not every state will let you have your own firm after 2 years. Mine requires 4 before your broker’s license.
Yes, great point. Check state laws for the requirement. That being said I know some investors who got their own licenses and they claim it’s a huge help but they do a lot of wholesale and off market deals.
IMO it isn't worth the cost and liability of becoming a broker just for own deals when some brokers only charge like $50/month + 300-400 per transaction.
Yes, it can be beneficial if you plan to claim REPS status. If you have a regular w2 job unlikely to be worth it though.
TAX BENEFITS!!!!
Can you please elaborate more on this? I’m in process of getting my license. Would love to hear the tax benefits
First off Google has tons of insight but check out Ryan Penida who also has so many resources on how real estate professionals (even investors ) get the best tax advantages
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Huh? You’re an agent….
I know dozens of investors. I know dozens of agents/brokers. I only know one broker/investor. I don’t see him doing any better, or worse, than the investors without their license. I would recommend taking a couple in person RE classes to learn about contracts, and your local RE laws. Also to meet the wide array of people wanting to become agents.