Advantages of Having a Real Estate License While Investing in Real Estate
More people are looking to real estate investment for a passive income than ever before, but not everyone who tries investing in real estate is successful. Getting a real estate license is often thrown around as a good idea when investing in real estate, but when pre-licensing courses can take anywhere from 40 to 180 hours, is it worth the effort? Keep reading to learn more about the advantages of having a real estate license as a real estate investor.
Save Money on Agent Commissions
The first and most obvious advantage of having a real estate license when investing in real estate is that you don’t have to pay commissions to a real estate agent. This can be a significant amount of money, depending on the property you’re buying or selling and the commission rate that your agent charges. When a residential property is sold, it's traditional that 5–7% of the sale price goes to the buyer's agent and the seller's agent to split. However, if you're your own seller's agent, that extra money gets to stay in your pocket.
Access the MLS
The MLS, or multiple listing service, is a database of properties for sale that is only accessible to licensed real estate agents and brokers. This database includes information on pricing, property details, photos, and more. While there are some websites that offer limited MLS access to the general public, you won’t have as much luck finding properties as you would if you had full access.
Having access to your local MLS can help you find properties that are not yet on the market and get a jump on the competition. In addition, you’ll be able to see recent sale prices of similar properties in the area, which can help you better determine what a property is worth.
Opportunities for Networking
In addition to the professional networking that you can do as a real estate agent, having a real estate license gives you access to events and conferences that are closed off to the general public. These events are often hosted by local or national organizations and can provide valuable opportunities for networking with other professionals in the industry.
You never know when you might meet someone who has a property perfect for your portfolio or who knows of an upcoming development that could be a great investment. Attendance at these events can also help you stay up-to-date on changes in the industry, which is important for any investor.
Opportunities for Education
Investing in real estate can be a complex undertaking, and there is always more to learn. As a licensed real estate agent, you’ll have access to educational opportunities that can help you brush up on your skills. These courses are often required to maintain your license, but they can also provide valuable information that you can use in your investing business.
In addition, many real estate agents are members of professional organizations that offer educational opportunities, such as webinars and conferences. These events can be a great way to learn about new trends in the industry and to find new investing strategies.
Better Negotiating Position
As a licensed real estate agent, you’ll have a better understanding of the market and the process of buying and selling real estate. This knowledge can give you a leg up when it comes to negotiating a purchase price for a property. In addition, if you’re familiar with the area where you’re investing, you’ll be able to better gauge whether a property is priced correctly.
For example, if you’re looking at a property that is listed for $200,000 but you know that similar properties in the area have recently sold for $180,000, you’ll be in a better position to negotiate a lower price.
Of course, as with any negotiation, it’s important to be prepared to walk away if you can’t come to an agreement on price. But having a real estate license gives you an edge in the negotiation process.
Is a Real Estate License Worth It?
The bottom line is that having a real estate license can give you a number of advantages when investing in real estate. From access to the MLS and networking opportunities to the ability to negotiate a better price, the benefits of having a license can be well worth the time and effort required to obtain one.
If you’re serious about investing in real estate, it’s definitely worth considering getting your license. It could be the key to taking your investment business to the next level.
