So you’re probably wondering: HOW then can I be a real estate investor without a license? Well, we’ve prepared for you a list of useful tools and tips that you can use in order to become a successful investor, without having to get a license. But before we go into the details of this list, let’s first see what exactly a real estate license is and what the benefits of having one as an investor are.
What Is a Real Estate License?
A real estate license gives real estate agents and brokers the legal ability to represent a property seller or buyer in a real estate deal. This means that anyone who wants to conduct real estate transactions on behalf of somebody else is required to be licensed.
Although there are no licensing requirements for people who invest in real estate, many investors choose to get a real estate license due to its many benefits. The most important benefit of getting a license is gaining personal access to the Multiple Listing Service (MLS), where properties for sale are posted by all brokerage firms. This means that if you obtain a license, buying and selling property will become easier as an investor through the MLS. If, for example, you want to sell a rental property or a flipped house, you can list your own property for sale without the assistance of a certified agent. This, in turn, will help you save a lot of money. In fact, an agent typically collects as much as 6% to 8% of the sales price as commissions. With the license, you’ll not only avoid agent commissions but also increase your income on every real estate deal. In addition, having a license as an investor can supply you with a broad real estate investment network and provide you with more control over your deals.
Related: How Can Obtaining a Real Estate License Boost Your Real Estate Investing Business?
However, having a license as an investor isn’t as necessary as many people think it to be. You can find many successful real estate investors who do not have a license. This brings us to our next point: How can I be a real estate investor without a license?
How to Become a Real Estate Investor Without a License: 4 Things You Do Need
1. Education
Educating yourself on real estate investing is key to becoming a successful real estate investor. Before buying an investment property, the first thing you need to do is learn the ins and outs of the real estate business. You need to have sufficient knowledge of all aspects of real estate investing, such as understanding the housing market, the different types of investment properties, the different investment strategies, the financing options available, and the risks involved in investing. There are also many laws and legal requirements that you need to know and follow, and sometimes they can differ from state to state.
Fortunately, you don’t necessarily need a degree to be a real estate investor. There are many different ways to get educated in real estate investing, and you actually don’t need to spend thousands of dollars to learn the business. You can, for example, get a copy of real estate books, read through magazines, listen to podcasts, or watch videos on Youtube. Blogs are also an amazing source of information; they are easily accessible and you can basically find everything you need to be a real estate investor. Take Mashvisor’s Blogs, for instance, they cover a variety of topics ranging from tips and guidelines to do’s and don’ts in real estate investing.
Related: How to Learn Real Estate Investing on Your Own
2. Access to listing data
To be a real estate investor, you need to have access to extensive listing data. There are many ways to gain access to valuable real estate insights without a license.
You can try to find and connect with an investor-friendly real estate agent who can grant you access to the MSL. It may be difficult to form this real estate networking relationship at first, but it will be rewarding in the long term. Having access to the MSL will make it easier for you as a real estate investor to do market research. You can pull accurate historical data on properties that have recently sold, and as a result, you will know how much to offer on a house or how much to put your investment property on the market for.
Related: Everything You Need to Know About Multiple Listing Services (MLS)
You can also get active listing data from the MLS by visiting real estate websites like Mashvisor or Realtor.com. These websites provide data sets that allow investors to pull comparable home sales without the actual use of the MSL.
3. Online Property Finders
When you invest in real estate, your goal is to find a property that matches your investment goals and business plan. But first, you need to decide what types of investment properties you want to target (single family homes, multi family homes, condos, etc.) and what price range you want to invest in. You should also choose the rental investment strategy you want to implement: for example, are you looking to invest in traditional (long-term) rentals or Airbnb (short-term) rentals? Once all that is determined, you can start looking for investment properties that match your criteria.
Luckily, you can use online property finders to help you in your search for the best investment properties. Mashvisor’s Property Finder can help you find the best and most profitable rental properties for sale in your city of choice quickly and easily. It’s a tool that comes with a number of filters that allow you to set your own criteria, such as your desired location, budget, preferred rental strategy (Airbnb or traditional) and type of investment property, etc. It then gives you all the available properties with the highest cash on cash returns and that best match your search criteria.
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4. Real Estate Analytics
Before buying an investment property or making any real estate deal, you have to do your due diligence first. You can do so using real estate analytics. Using real estate analytics will make your life easier and help you save so much time when it comes to investing in real estate.
Using Mashvisor real estate database, you can obtain accurate analytics that can help you identify the optimal investment opportunity for you to invest in. They are actually embedded in Mashvisor’s Investment Property Calculator. These analytics are predictive, meaning they can show you future trends and outcomes based on historical and comparative data. With predictive analytics, you will not only get projections of your rental income and returns on investment but also see if an investment property will make more money as a traditional rental or as an Airbnb rental. This will allow you to make smarter and better real estate investment decisions.
Mashvisor’s Investment Property Calculator
When it comes to investing in rental properties, it is crucial that you evaluate the selected properties before buying them in order to ensure that they will be profitable. Basically, you want the properties to generate positive cash flow; in other words, your rental income must exceed your rental expenses so you can make a profit.
The best way to ensure that a rental property will be profitable is by using a real estate investment calculator, also called a rental property calculator. It’s a tool in which you input some basic information about a residential real estate property, such as the purchase price and the financing method, and then it calculates your rental income, rental expenses, and return on investment (as cap rate or cash on cash return). Based on these calculations, it can tell you whether or not you should go for the rental property. If you want the best investment property calculator in the market, use Mashvisor’s Investment Property Calculator.
Click here to sign up for Mashvisor and get access to the best investment property calculator.
Conclusion
It is totally possible to be a real estate investor without a license. It is true that having a real estate license can boost your real estate investing business, but there are many tools available (listed above) that can help you invest in real estate without having to get one.
Do you want to buy your first investment property? Sign up for Mashvisor and become a real estate investor now.