You don’t need a real estate license to flip houses, but some flippers find these credentials come in handy. You should get a real estate license to flip houses only if the benefits make sense for your business. For many flippers, it’s not necessary to have a real estate license to do the job, but circumstances can change with success. Just don’t waste the money getting your license only to decide that home flipping isn’t for you!
When To Consider The Real Estate License
You should consider a real estate license only if you’re going to flip houses full-time. Getting your real estate license is a lengthy process, and while it will give you some insight into the legal and financial side of transactions, it isn’t very practical for the hard work needed to renovate houses. You’ll also have to pay fees to become licensed, which will cost thousands of dollars no matter where you are.
One benefit of becoming a licensed real estate agent is that you get access to a Multiple Listing Service (MLS). This lets agents catch new properties in ideal locations faster than someone relying on a real estate agent to locate them. The MLS also provides valuable historical data on the neighbourhoods and properties. This includes past and present sales prices, comps with similar properties for comparisons, and other valuable information.
However, it is possible to access free listing services and create a good list of leads. For those doing house-flipping as a side hustle, this will save the high amount of money it takes to get a license.
Free Multiple Listing Services And Other Tactics
There are many listing services available in Canada. Realtor.ca, Prelist, and Zillow Canada are good starts to your research. They won’t be as detailed as a realtor’s MLS, but they can give you a good indication of the market and help you find some leads.
Many great opportunities aren’t uploaded to listing services. Industry insiders call these “pocket listings,” and it’s a tactic used by some brokers to earn a higher commission without sharing it with another agent. Home flippers without a connection to the industry could find the right property could pass them by. Pocket listings are harder to find, but if you join up with someone who has contacts or perform the right search on Zillow, you might have some luck.
Some people who are new to the house flipping might feel their lack of real estate knowledge prevents them from making the first step. You can start by joining up with a property investment company and taking a more hands-off approach to home flipping. It’s a good way of dipping your toe in and learning if the industry is right for you.
Hesitation is understandable, but it can hurt your strategy. You have to act fast and expect the property to take a lot of your time. You’ll be managing contractors, doing the work, and trying to stick to timelines. If you’re doing it as a side hustle or as a hands-off investment, don’t bother getting a real estate license. But if you choose to do it full-time, a license might be a good investment!