A common question that comes up with many people that get involved with flipping real estate or other real estate businesses is whether or not they should take the time to get their real estate license. There is no right or wrong answer to this question and it's really up to the individual, but here are some of the pros and cons that come with having your real estate license while also building a real estate investing business.
Unlimited Access to the Best Information
One of the good things about having a real estate license while working on your real estate investing business is that you'll have access to info that other investors may not. Of course other investors might have a real estate agent as part of their team. But it's not the same as having access to the info yourself, where you can check prices, look at comps and pull up other information anytime you like. This is probably the single biggest reason why people decide to get their real estate license while also pursuing real estate investing or real estate flipping.
Networking and Credibility
As a licensed real estate agent, you'll also be able to network with other agents which is an added benefit. This lends to your credibility as a real estate entrepreneur and helps to separate you from the 350 people that attended the latest seminar that was in town this past weekend.
Access to Properties
Once you have your real estate license, you'll also have access to virtually any property that is listed in your area. That means if you're interested in making offers on listed properties or would like to see them close up, you don't need to have another real estate agent with you to show you the property. This is another big advantage of having your real estate license and is certainly something to consider as you make your decision.
Disclosure
The biggest downside you'll face with having your real estate license and doing real estate flipping/investing is that you have to disclose the fact that you're a licensee. In most states, if you're involved in a real estate transaction and you're a licensed real estate professional, you have to let the other party know that that's the case. This is seen as a necessary step to protect the public from being taken advantage of. This leads to the next possible downside of having your real estate license and also doing real estate investing.
Playing Fair
Unfortunately some people may see it as unfair that you, as a real estate professional, are making lower offers than what they would like. Some people might have an unrealistic view of the condition of their property or the amount of money it would take to repair it and when presented with a low offer from a real estate professional, they might see that as someone trying to pull a fast one on them.
Dealing With Your Broker
The last issue with having your real estate license and also being a real estate investor has to do with working with your real estate broker. Of course, as a brand-new real estate licensee, you'll have to work under a broker who is legally liable for any real estate related activities you're involved in, whether that's listing someone's home in your real estate agent capacity or making an offer on home as an investor. Some real estate brokers might not like the lack of control that they have in not knowing what you're doing as you're working your other business and might have reservations about wanting to bring you on board. Because of this, an important step in the decision process is to talk with potential real estate brokers as you decide where you would like to hang your license. That way everything is on the table and everyone involved is in agreement as to what is accepted and what is not.
For the most part, the decision to get a real estate license and work as a real estate investor is a personal decision that only you can make. But one other good tip would be to talk to others in your area that have gotten their license and ask them why. Also seek out those that have not gotten their license and find out their reasons and any possible disadvantages that have come up. Then you can make an informed decision about whether or not this is a worthwhile endeavor for you in growing your business.
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