Becoming a Realtor™: Pros and Cons for Investors and Choosing the Right Broker

Jan 20
17:52

2025

Wendy Patton

Wendy Patton

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Becoming a Realtor™ can be a game-changer for real estate investors. It offers direct access to the MLS, potential savings on commissions, and increased credibility. However, it also involves responsibilities and potential liabilities. This guide explores the benefits and drawbacks of becoming a licensed Realtor™ and provides insights into choosing the right brokerage to maximize your investment strategy.

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Why Consider Becoming a Realtor™?

Advantages for Investors

  • Access to MLS: The Multiple Listing Service (MLS) is the largest database of real estate listings. Realtors™ have exclusive access,Becoming a Realtor™: Pros and Cons for Investors and Choosing the Right Broker Articles which can be a significant advantage for investors seeking the best deals and accurate property comps. Source: National Association of Realtors.

  • Commission Savings: Typically, real estate commissions are around 6% of the sale price, split between the buyer's and seller's agents. By becoming a Realtor™, you can save up to 6% on transactions by acting as your own agent. For a median-priced home of $215,000, this could mean saving $12,900. Source: Zillow.

  • Credibility: Being licensed can enhance your credibility with sellers, as it demonstrates professionalism and expertise.

  • Additional Income: You can earn commissions and referral fees by representing other buyers and sellers or referring them to other agents.

Potential Drawbacks

  • Increased Liability: Some investors worry about increased liability, as being licensed may imply "expert" status in legal situations. However, this risk is often mitigated by adhering to ethical practices and maintaining proper insurance.

  • Perception Issues: Some sellers might be hesitant to work with licensed investors, fearing conflicts of interest. However, many appreciate the expertise and professionalism that comes with a license.

Choosing the Right Brokerage

What to Look For

  • Training and Support: A brokerage that offers comprehensive training can be invaluable. Continuous learning enhances your skills and confidence, making you a more effective investor and agent.

  • Culture and Environment: Look for a brokerage that encourages creativity and entrepreneurship. Some traditional offices may not support investor activities, so find one that aligns with your goals.

  • Commission Splits: Consider the financial arrangements. Some brokerages, like Keller Williams, offer attractive commission splits and additional income opportunities through recruitment. Source: Keller Williams.

Keller Williams: A Case Study

  • Training Focus: Keller Williams is renowned for its training programs, which are crucial for both new and experienced agents.

  • Investor-Friendly: The company supports real estate investing and entrepreneurship, making it a good fit for investor-agents.

  • Growth Opportunities: Keller Williams offers a unique model where agents can earn from the sales of those they recruit, providing an additional income stream.

Conclusion

Becoming a Realtor™ can significantly benefit real estate investors by providing access to essential resources, saving on commissions, and enhancing credibility. However, it's crucial to choose the right brokerage that supports your investment goals and offers robust training and support. Keller Williams is one example of a brokerage that aligns well with these needs, but it's essential to evaluate all options based on your specific circumstances.

For more information on becoming a Realtor™ and choosing the right brokerage, visit the National Association of Realtors and Keller Williams.

Wendy Patton is a leading expert in lease options and creative seller financing. For more insights, visit Wendy Patton's website or download her free report on common lease option mistakes at Lease Option Education.