One of the most common questions that I am asked on a daily basis from new real estate investors is whether or not it would be beneficial for them to get their real estate license.
I spent many years as a real estate investor wholesaling, rehabbing, fixing, flipping and renting properties without having a real estate license.
Ultimately I decided that it was more beneficial to get my real estate license than to not have a license. In my opinion having a real estate license does not hinder your ability to operate as a real estate investor and also gives you the added benefit of additional streams of income.
If you are thinking about whether or not it would be worthwhile for you to get your real estate license then here are some points for you to consider:
- Why do you want to get your real estate license?
- Are you required by law to have a real estate license?
- How will having a license benefit or hinder your ability to operate as a real estate investor?
Every few years the State Attorney General’s Office goes on a witch hunt looking for individuals that are soliciting real estate without a license. So if the idea of a third degree felony bothers you (it should) then get your real estate license.
In summary, if you are marketing your own deals then you don’t need a real estate license but if you are marketing other people’s deals then you do. If you do not have a real estate license then you cannot find buyers for other real estate investors. You also cannot help other real estate investors sell their properties for a fee. So clearly there is an advantage to having your real estate license. You will make a lot more money as a real estate investor with a license.
The final question that you should ask yourself is how having a license will hinder or benefit you as a real estate investor. If you only wholesale your own deals, manage your own properties or fix and flip your own properties then you do not need to have a real estate license.
However, the more active you get as a real estate investor the more opportunities there will be for you to benefit from having a license. You will be able to list properties, manage properties for others for a fee, wholesale other investor’s deals, find sellers for other investors, and find buyers for other investors.
You will also, save money on purchases and sales by earning a commission. And by far the biggest reason of all to get your real estate license is to have access to the MLS. In short there are a lot of benefits to having your real estate license.
What are the negatives to having your license? I don’t really see any. You will have to disclose that you have a license when you buy or sell a property and you will also be bound to act ethically (which you should already be doing).
Having a license will give you more opportunities to make money as a real estate investor. If you are considering being a full time real estate investor then having a license will benefit you in the long run. This applies regardless of whether you want to wholesale, fix and flip or be a landlord.