5 Finishing Touches You Shouldn’t Forget in Your Flip
This will probably confuse at least a few of you, since both Tarek and I have our real estate licenses and we act as our own realtors for our flip houses. Really, though, if we hadn’t started off our real estate investing careers as realtors, I think we probably would’ve waited a while before taking over that part of our business.
So why should you wait on getting your real estate license if you don’t already have it? Here are a few reasons that taking this step too early can really mess up your budding house flipping business and keep you from attaining financial freedom.
Just Having Your License Won’t Get You MLS Access
When you first started reading about flipping houses, you probably read somewhere that getting your real estate license will get you access to the MLS (multiple listings service). Well, yes and no. Yes, real estate agents can access the MLS, but to do this you have to be a broker or a part of a brokerage. Not only that, but you’ll usually have to join a local real estate board and pay regular fees to maintain your membership.
If you’re just starting to build your real estate investing business, you might not want to incur a bunch of monthly, quarterly, or annual fees right away, especially ones that aren’t directly tied with making sales. Instead, it usually makes more sense to start getting some experience flipping houses with the help of an expert real estate agent. They will take a commission when you sell, but you won’t have to worry about paying them a monthly fee or any other charges when you are in between sales and aren’t making any cash.
It’s Better to Have a Set Plan First
If you’re planning on being in the house flipping business for the long term, you can definitely improve your investments by acting as your own real estate agent. However, starting out and diving straight into it without a solid plan is a good way to spend a lot of time and money without seeing a lot of returns for quite some time.
Some of our students plan this out by getting their licenses first, then working under a broker to get familiar with the industry and to hone their negotiation skills. If you really want to start your real estate investing business as your own realtor, this is a good way to go about it. But if you want to start your business sooner rather than later, and you want to start making money flipping houses in the next few months, I recommend waiting and figuring out a different plan.
The key, whether you start studying for the exam now or later, is to understand your business model and your lifestyle. If you want to quit your day job as soon as possible, it’s probably going to make more sense to start buying and flipping houses with a realtor than to take the time and money to get your license before you start flipping.
Along with all that, working with a really good realtor can help you get to know how they work and give you a bit of experience with what you’ll need to do to become your own great realtor. Your realtor will do more than just find properties and negotiate with buyers and sellers, so why not take advantage of their expertise for a while before you jump right into getting your license? You could make a lot of money while you do this, and you might even decide that you don’t need to get your license at all. Either way, though, you’ll have more experience and understand the best moves for your real estate investing business if you wait.
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