There are several reasons why you may want to consider getting a real estate license. For many, it can become a primary source of income. Others may seek to create an income stream or use it as an income stream side hustle. Getting a license will also benefit those who want to get an edge over others investing in real estate.
Regardless of your reason, there are many things to consider when getting your real estate license. Before jumping into anything, you should know the process involved in becoming a licensed agent.
How to Become a Real Estate Agent in New Jersey
Be at least 18 years old
You must be at least 18 years old to obtain a real estate license in New Jersey. You must also be a US citizen or permanent resident alien and have completed high school or the equivalent of high school.
Enroll and complete the required educational course
You will need to attend a qualifying licensing school for 75 hours and successfully complete a real estate course. The real estate school will need to be licensed by the New Jersey Real Estate Commission. For more information on approved educational courses, see here.
Pass the state licensing exam
Passing the state licensing exam is the next step toward obtaining your real estate license. You will need to do this within a year of graduating. To register, go to the address http://candidate.psiexams.com/. Exams are not easy either, like any important exam, there are preparation courses that you can take as well.
Real estate brokerage and fingerprinting services
You must be fingerprinted and sponsored by a licensed real estate broker before you can apply for a real estate salesperson’s license. To avoid problems and submit the documentation on time, submit your fingerprints as soon as possible after passing the state examination.
Submit an application
After completing the above steps, you will need to submit an application to the Bureau of Real Estate Licensing Services. This must be done again within a year of completing the education. To ensure that your application is accepted, send the application fee and a document proving your fingerprints.
Is it worth it for real estate investors?
If you are already involved in real estate investing, becoming a licensed realtor will definitely have its benefits. Of course, you won’t be the only investor with a license, but it will put you in line with others who are licensed and give you an edge over those who don’t. Here are some of the main arguments for obtaining a real estate license from an investor’s point of view:
Access the MLS: Even with all the websites available to potential investors, the MLS is still the best source of available real estate. Obtaining a license will grant you access to this tool. This will provide you advantage over other investors which do not have access. Yes, other investors will have access to their agents, but cutting out the middle man always saves time. You’ll be able to act faster on any potential deals if you’re the only one involved.
You will save money on your investments: PPerhaps the most common reason investors want to become a licensed agent is to make their investments a little more profitable. This is done by saving on real estate fees and commissions. By being your own agent, you essentially eliminate the commissions you would pay a real estate agent when buying or selling real estate. This will likely save you thousands of dollars on both ends of each transaction.
Network with other agents: You should never overlook networking, regardless of your profession, and real estate is no different. Becoming a licensed agent will give you more opportunities to meet like-minded investors or professional agents. Not every contact will pay off, but you may definitely have an opportunity or two because of the new connections you’ve made in the industry.
Other tools and resources: Obtaining a real estate license will give you access to tools and resources not available to those without a license. As with anything else, the more tools and information available, the better. The MLS mentioned earlier will still be king, but more information never hurts.
It will be easier for you to work with: Selling any home is always easier when fewer people are involved. First, much less information will need to be transferred, so things move much faster. With this in mind, you will not be playing a game of telephone so that the information being transmitted will not be misinterpreted. What you want or need will be more clearly communicated to other participants, which can also save days on any transaction. Having your license can also show other participants that you’re serious and have done it before. Working with an experienced investor, rather than a novice, can be seen as a positive for others.
education: As mentioned above, you will need to go through about 75 training institutions to get your license. Much of this information may be available to others or they will learn from experience, but the value of formal education should never be underestimated. You will have information that others do not have. Even if other investors eventually learn what you know, you’ll have a big head start. You also increase your knowledge as you go.
At the end of the day, it’s up to you to decide whether becoming a licensed Realtor is worth the time and money to you. If you are planning to make several real estate investments, this would definitely seem like it. However, the time commitment isn’t just about getting an education. Remember, you’ll now be on the hook for a lot of paperwork, showings, and all the other functions your agent usually does for you behind the scenes. There are also many costs of doing business that your agent would normally cover (boxes, marketing, etc.) that you are now responsible for. It’s not like you pocket the saved commissions at no extra cost. A license may be better for you if you are ready and willing to take it all on.
Is it worth it as a side hustle?
You may be interested make money on real estate, but solely as an agent, not an investor. With the interest in seemingly taking care of everything these days, you might think it’s just a matter of pushing a few buttons and poof, the house sells and you make a commission. While there is no need to do it in person these days, selling a home is still a lot of work for agents on both sides. There are many things to consider before getting a side hustle license.
Getting a license takes time and money: You don’t just walk into the Realtor exam and pass it without proper preparation. In fact, as mentioned several times, you will need to complete about 75 hours of formal education first. It takes a lot of time, and formal education usually doesn’t come without costs. You will have to decide how seriously you want to pursue this as a side hustle invest your time and money before you start doing any of this.
It requires a lot of your time: When most people think of a side hustle, they think of something quick, easy, and something that can be done on a schedule. As a realtor, you won’t be able to do any of these things. When you have a client, you can’t tell them you’ll get to the paperwork in a week, or that you don’t feel like doing a showing that day. They expect you to answer their questions and other needs. Real estate is a full time job for most and will require more than a few hours of your attention a week if you want to be good.
You will be at a disadvantage: Gone are the days of people walking into a realtor’s office and looking for the first available sales agent, but that doesn’t mean you’ll be on a level playing field with full-time agents. While you are there working 9 to 5, they will be devoting all their time to finding more customers and increasing sales. At best, you’ll be playing most of the time since you won’t have as much time as regular agents.
Not only that, but if potential clients know you only work as a part-time job, they may be turned off. People will need your undivided attention, and knowing that you may not be available every day from 9 to 5 can be very discouraging.
Obtaining a realtor’s license may be a way to add another stream of income to your arsenal, but it is by no means an easy way to make money. If you’re willing to put in the time and effort, you can definitely make it worth your while with just a few sales a year. You will need to be available to the client, spend hours working with documents and be ready for all the responsibilities associated with the work of an agent.
All this while juggling a full-time job, family and other responsibilities can be challenging. Make sure you understand what you are getting yourself into before you invest your time and money in real estate education to become a licensed real estate agent.
There are definitely benefits to becoming a licensed broker, both from an investment perspective and from a side hustle perspective. None of them are without flaws either. Investors will have additional work and costs for their transactions, and they will not simply appropriate commissions. There may also be restrictions on what trades they can place themselves, depending on which brokerage they are affiliated with.
Both for investing and for side hustle, there are cost and time commitments such as refresher courses and renewal fees that you will also need to consider. At the end of the day, you’ll have to decide how much it’s worth doing all these functions yourself and how much money you’ll makesave in the process.