Should I get a real estate broker license?
March 22, 2007 11:56 PM Subscribe
How is having a broker's license useful for doing one's own or a family member's real estate investments? I am thinking of getting one.
Do any brokers out there do a lot of their own investments like flipping properties?
Do any brokers out there do a lot of their own investments like flipping properties?
Not sure about your state... I'm in Minnesota and a licensed Realtor. To be a "normal" broker I need 2 years of being a sales agent and more classes, fees, etc.
In Minnesota you must be licensed to buy/sell more than 3 or 4 properties per year, even if it's for yourself. They offer something here that doesn't require classes or a lot of the other stuff. It's called a limited broker's license. Basically you are just paying the fee and registering with the state, and the limit is you can't buy/sell for someone else -- only yourself. Perhaps that is more in line with what you are looking for.
Most of the "we buy ugly houses" guys here are limited broker's. They never represent anyone but themselves.
posted by thilmony at 4:52 AM on March 23, 2007
In Minnesota you must be licensed to buy/sell more than 3 or 4 properties per year, even if it's for yourself. They offer something here that doesn't require classes or a lot of the other stuff. It's called a limited broker's license. Basically you are just paying the fee and registering with the state, and the limit is you can't buy/sell for someone else -- only yourself. Perhaps that is more in line with what you are looking for.
Most of the "we buy ugly houses" guys here are limited broker's. They never represent anyone but themselves.
posted by thilmony at 4:52 AM on March 23, 2007
The main advantage of having a broker's license is that you can eliminate the middleman. The broker will always take a fee for transactions, and if you can cut him out, that means more for you.
I'm in Kansas, and the requirements are similar to the Minnesota requirements thilmony has outlined.
If you can do it and anticipate doing more than 3-4 transactions a year, I'd say do it.
posted by reenum at 5:09 AM on March 23, 2007
I'm in Kansas, and the requirements are similar to the Minnesota requirements thilmony has outlined.
If you can do it and anticipate doing more than 3-4 transactions a year, I'd say do it.
posted by reenum at 5:09 AM on March 23, 2007
In Missouri, they now require 1 or 2 years of experience as a licensed salesperson before you can become a broker. The only way I can see to make it actually worthwhile is to have your own office, and the costs/risks in that are not small. You have all of your classes, fees with the state, plus fees for joining and maintaining a Realtor designation, fees for joining a Multiple Listing Service (so you can actually look up and list houses with other agents), errors and omissions insurance, and in Missouri you are required to have an office with regular posted hours.
I do know a handful of agents (brokers and salespeople) who do a reasonable amount of their own property purchasing, but they are definitely in the minority. I think you'd be hard pressed to cover the associated costs unless you're doing numerous or very large deals. I'm a broker-salesperson, which means I currently work under another broker as a salesperson, but I have the ability to work on my own if I wanted to open my own office (I got the broker's license right out of the gate, before they instituted the salesperson experience requirement). I do handle deals for some family members, but the reason is they'd rather I get the money than one of the hundreds of other Realtors working out there that they don't know. The broker still gets their cut whether its a deal for my family, myself, or a stranger.
posted by shinynewnick at 6:22 AM on March 23, 2007
I do know a handful of agents (brokers and salespeople) who do a reasonable amount of their own property purchasing, but they are definitely in the minority. I think you'd be hard pressed to cover the associated costs unless you're doing numerous or very large deals. I'm a broker-salesperson, which means I currently work under another broker as a salesperson, but I have the ability to work on my own if I wanted to open my own office (I got the broker's license right out of the gate, before they instituted the salesperson experience requirement). I do handle deals for some family members, but the reason is they'd rather I get the money than one of the hundreds of other Realtors working out there that they don't know. The broker still gets their cut whether its a deal for my family, myself, or a stranger.
posted by shinynewnick at 6:22 AM on March 23, 2007
As an aside, hopefully not a derailment -- I got into flipping (actually rehabbing and selling for more) and rental properties. I decided to get my agent license to save some commission, but found I really like being an agent for others and made that my main gig for awhile. The risk is lower and I still get to work in Real Estate.
posted by thilmony at 1:43 PM on March 23, 2007
posted by thilmony at 1:43 PM on March 23, 2007
You get what we call "The 6% advantage"
posted by growabrain at 9:51 PM on March 23, 2007
posted by growabrain at 9:51 PM on March 23, 2007
This thread is closed to new comments.
posted by lobstah at 4:44 AM on March 23, 2007