Author Topic: Worth Getting a RE License as a back-up plan/side-gig?  (Read 3376 times)

BrickByBrick

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Worth Getting a RE License as a back-up plan/side-gig?
« on: January 18, 2016, 01:09:18 PM »
I know that at least in my state (Virginia), there are 60 hours of 'classes' you have to take, followed by a national and state exam - once you pass and apply to the state board you can get your license.  Overall my research indicates it's not really an expensive process just time consuming (seems like a max of 1K when all is said and done).  To clarify I'm just referring to a Sales License, not the next level up of broker/etc.

What I'm looking for some feedback on is this:  I don't really have a solid plan to use it.

I'm finishing up an MBA and have taken a few classes on Real Estate.  I also happen to know personally quite a few 'successful' real estate professionals.  I am interested in the subject matter and I am planning on getting involved/investing in rental property in the near future - but I know I don't need a RE license for that.  However I really like the idea of keeping it as a kind of back-up plan if I want to switch careers or as something to pursue post-FI.  I'm also thinking of potential side-gigs from the real estate professionals I know to earn some extra income.

I also know that I will have to take 'continuing education' classes to keep the license and that will add to the total cost.

So does anyone have any comments/feedback on possible negative consequences of getting a RE license, possibly long before I ever use it, other than some time and money?  Any other thoughts?

arebelspy

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Re: Worth Getting a RE License as a back-up plan/side-gig?
« Reply #1 on: January 21, 2016, 07:11:56 AM »
Being a real estate agent is a job.

Besides the ongoing licensing requirements in terms of both time and money, it's difficult, IMO, to do as a minor side-gig, because you won't be in the deal flow.  Doing it regularly gets you referrals from past clients, it means you're probably advertising, etc.

Doing it rarely means you don't have those incoming streams of deals, and it's much harder to do, because you're competing with full time agents who do have all those advantages.  How do you expect a random home buyer (or seller) to find you to buy/sell something if you aren't advertising or they aren't getting a word of mouth referral?

YMMV, of course, but this is how I see it.  It's a good job if you're a sales-type person.  It's a poor side-gig, except for maybe rare one-offs from friends or family who know you have a license and are looking to save money.
We are two former teachers who accumulated a bunch of real estate, retired at 29, spent some time traveling the world full time and are now settled with three kids.
If you want to know more about us, or how we did that, or see lots of pictures, this Business Insider profile tells our story pretty well.
We (rarely) blog at AdventuringAlong.com. Check out our Now page to see what we're up to currently.

GrowingTheGreen

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Re: Worth Getting a RE License as a back-up plan/side-gig?
« Reply #2 on: January 21, 2016, 08:01:55 AM »
I think there are more productive ways to establish a safety net. Low barrier to entry means you'll have a ton of competition.

Bearded Man

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Re: Worth Getting a RE License as a back-up plan/side-gig?
« Reply #3 on: January 21, 2016, 08:30:48 AM »
Low barrier to entry but high turnover. If you are FI, you can stick it out.

I'm considering getting it primarily so I can get better deals and save myself money buying and selling, however; I've considered it as a side gig post FIRE.

As I await the closing of yet another new house, my financial situation has strategically improved again through a strategic purchase in that I can live off $4000 a year if I elect to, with passive income FAR beyond that. Alas, I'm still in a mindset where while the getting is good, I want to keep getting, so I won't likely trigger that plan yet and wait until I want to slow down drastically, re-arrange my living situation and go into have fun with life mode, while still having some side gigs like RE agent to bring in the occasional "bonus".

arebelspy

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Re: Worth Getting a RE License as a back-up plan/side-gig?
« Reply #4 on: January 21, 2016, 09:44:10 AM »
Low barrier to entry but high turnover. If you are FI, you can stick it out.

But just "waiting" doesn't make it eventually work.  It's the ones who stick it out but are continually working to grow their business via the methods I mentioned.  Doing that rarely in FI as a side gig won't get you there.

Doing it for your own deals is one thing (though I also am meh on that, for other reasons discussed in other threads), but that's definitely better than trying to do it for others on a part-time basis.

There's a reason turnover is so high, and "sticking it out" isn't a matter of waiting it out.
We are two former teachers who accumulated a bunch of real estate, retired at 29, spent some time traveling the world full time and are now settled with three kids.
If you want to know more about us, or how we did that, or see lots of pictures, this Business Insider profile tells our story pretty well.
We (rarely) blog at AdventuringAlong.com. Check out our Now page to see what we're up to currently.

Bearded Man

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Re: Worth Getting a RE License as a back-up plan/side-gig?
« Reply #5 on: January 21, 2016, 12:08:23 PM »
Low barrier to entry but high turnover. If you are FI, you can stick it out.

But just "waiting" doesn't make it eventually work.  It's the ones who stick it out but are continually working to grow their business via the methods I mentioned.  Doing that rarely in FI as a side gig won't get you there.

Doing it for your own deals is one thing (though I also am meh on that, for other reasons discussed in other threads), but that's definitely better than trying to do it for others on a part-time basis.

There's a reason turnover is so high, and "sticking it out" isn't a matter of waiting it out.

I thought it was obvious you don't just get a RE license and wait. The presumption is that you are actually working to build your business...No one said just get a license and wait while twiddling your thumbs....

arebelspy

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Re: Worth Getting a RE License as a back-up plan/side-gig?
« Reply #6 on: January 21, 2016, 12:25:55 PM »
Low barrier to entry but high turnover. If you are FI, you can stick it out.

But just "waiting" doesn't make it eventually work.  It's the ones who stick it out but are continually working to grow their business via the methods I mentioned.  Doing that rarely in FI as a side gig won't get you there.

Doing it for your own deals is one thing (though I also am meh on that, for other reasons discussed in other threads), but that's definitely better than trying to do it for others on a part-time basis.

There's a reason turnover is so high, and "sticking it out" isn't a matter of waiting it out.

I thought it was obvious you don't just get a RE license and wait. The presumption is that you are actually working to build your business...No one said just get a license and wait while twiddling your thumbs....

Just wanted to make that clear.

Due to the amount of work necessary, it's hard for it to truly be just a side-gig.  It's something the requires constant, active work. That may or may not be what you're looking for, and might be something you enjoy, but it's not something that can be done sporadically and be successful at all, IMO.
We are two former teachers who accumulated a bunch of real estate, retired at 29, spent some time traveling the world full time and are now settled with three kids.
If you want to know more about us, or how we did that, or see lots of pictures, this Business Insider profile tells our story pretty well.
We (rarely) blog at AdventuringAlong.com. Check out our Now page to see what we're up to currently.

VladTheImpaler

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Re: Worth Getting a RE License as a back-up plan/side-gig?
« Reply #7 on: January 21, 2016, 12:29:06 PM »
I've been pondering renewing my RE license too.
It's been expired for over 10 yrs, so I'd have to take the test again.
The main reason is to get access to the MLS, so I can see what's on the market before everybody else.
Currently, I'm just browsing Trulia and Zillow.
What does everyone else use?
Is there a superior place online to get detailed info on foreclosures?

mrteacher

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Re: Worth Getting a RE License as a back-up plan/side-gig?
« Reply #8 on: January 21, 2016, 12:44:28 PM »
I've been planning on getting my RE license to start a side hustle in the spring and over the summer (I teach and have summers off).

I live in Boston where apartment rentals typically require a broker fee (some large portion of which goes to the real estate agent who rents the apartment). Because of this, I think it's worth it for me to start this as a side hustle. Two friends have done this for the past year or two and been quite successful.

I'm not sure if this would change the tune of some who are against the idea or real estate as a side hustle?

BrickByBrick

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Re: Worth Getting a RE License as a back-up plan/side-gig?
« Reply #9 on: January 22, 2016, 08:42:18 AM »
Thanks all for the responses, I appreciate the thoughts.

It's a poor side-gig, except for maybe rare one-offs from friends or family who know you have a license and are looking to save money.

It's actually those rare one-offs that interest me, at least until post-FI.  That, and perhaps serving as a temp for some of the RE professionals I know whenever they need someone quick due to illness/vacation (these guys own their own companies).  It is however difficult to determine whether the upfront time and expense would be worth it just for these rare gigs.

It's starting to sound like I should probably hold off until I'm closer to FI and am more likely to use it.  Thanks again all for the comments.

Is there a superior place online to get detailed info on foreclosures?

I have a couple non-RE friends who search for potential rental properties on http://www.hudhomestore.com/Home/Index.aspx.  It's far better than many other online sources I've seen, though I don't yet have direct experience buying foreclosures so it's just my uneducated opinion.

Bearded Man

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Re: Worth Getting a RE License as a back-up plan/side-gig?
« Reply #10 on: January 23, 2016, 09:14:25 PM »
Low barrier to entry but high turnover. If you are FI, you can stick it out.

But just "waiting" doesn't make it eventually work.  It's the ones who stick it out but are continually working to grow their business via the methods I mentioned.  Doing that rarely in FI as a side gig won't get you there.

Doing it for your own deals is one thing (though I also am meh on that, for other reasons discussed in other threads), but that's definitely better than trying to do it for others on a part-time basis.

There's a reason turnover is so high, and "sticking it out" isn't a matter of waiting it out.

I thought it was obvious you don't just get a RE license and wait. The presumption is that you are actually working to build your business...No one said just get a license and wait while twiddling your thumbs....

Just wanted to make that clear.

Due to the amount of work necessary, it's hard for it to truly be just a side-gig.  It's something the requires constant, active work. That may or may not be what you're looking for, and might be something you enjoy, but it's not something that can be done sporadically and be successful at all, IMO.

Well for me it would primarily be a way to be less angry about the transaction costs of real estate when I sell houses. This way I can save myself some money since I invest in rental real estate. Excise tax on a 500K (one I'm buying now) house is bad enough, but 6% commission to unlock the door and fill out standardized contracts? I will at least save myself half of that commission, and will no longer be at the mercy of an agents schedule to get my offer in.

Since I plan on doing some property management on the side, getting a realtors license (seems to be required in most states, at least mine and the ones I've considered moving to) will help me make additional part time income. Selling houses on the side will be another. And in my neck of the woods, selling half a million dollar houses, it doesn't take much to give me some pocket money for a year.


NoNonsenseLandlord

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Re: Worth Getting a RE License as a back-up plan/side-gig?
« Reply #11 on: January 30, 2016, 06:59:17 AM »
I have a RE license, and I make a little bit of money.  I have 24 renters that supply me with a chain of buyers.  Even then, I do not get a lot of business.

It will cost ~$1500 a year to maintain a license.  Think about that.