- You don’t like the process of buying and selling houses.
It probably goes without saying that if you don’t like real estate, you shouldn’t get into it. To get your license, you will have to take quite a few real estate courses and to keep your license, there will be continuing education every few years.
- You have a close family member who is an agent.
Because many of you would get your license mainly to represent close family members and friends on the side, there could be some family conflict if you take business away from the other family member. Of course it doesn’t have to be this way, but if the other close family member derives most of their income this way, they may feel threatened if you get your license. And they may worry that they’ll lose some of the business they would’ve otherwise received from the family. There are ways around this relationally, but it may be a reason you don’t get your license.
- You primarily plan to be in investment real estate.
As I’ve shared in a previous blog, if you are primarily planning to be in investment real estate, getting your license could actually be a disadvantage. Remember that investment and retail real estate are two different businesses. You may find it helpful NOT to have your license on the investment side.
- You don’t like unpredictable income.
Since becoming a real estate agent is becoming self-employed, no one is going to send you a paycheck for the hours you’ve worked. You only get paid as you close transactions for the clients you serve. If you don’t represent any clients, you won’t get paid any money, even if you’ve worked 30 hours building your business. You might make $4,000 in commission one month and not make any more money for several months. Since you don’t have a job, you don’t regularly get a paycheck unless you build your business to the point where you have closings every few weeks, which can take awhile.
- You are strapped financially and can’t afford the startup or ongoing costs.
Getting your license has both startup costs and ongoing costs. And you will have to pay some of these while you are waiting for your first deal. You’ll have to pay for your courses, your exam, your license costs, your initial broker setup fees, etc. Then you’ll have some monthly ongoing costs. These aren’t very high, but if you are struggling financially, any additional costs might put a strain on the budget.
While I think getting a real estate license is a great way to make supplemental income, there are certainly some reasons it may not be a fit for everyone.
