Although a career in real estate can be very exciting, working commission-only can be a little unsettling at times. If you’re feeling somewhat financially insecure, then you should consider pursuing other income streams.
In this post, I’m going to cover five additional ways to earn money as an agent or a broker.
As a real estate wholesaler, you essentially get paid to bring a buyer to a seller. That’s putting it very simply. Now, you might be thinking, “Uh, that’s what I do as an agent anyway.”
Well, wholesaling properties is a bit different than working with active listings.
I’ll explain by example: Let’s say you meet John who wants to sell his home quickly, and he doesn’t want to pay any real estate commission or wait for his property to sell on the open market. He wants a cash buyer and a quick sale.
You offer to purchase John’s property for $40,000 cash and close in 30 days. John agrees, and you both sign a contract.
However, you’re not actually the buyer.
You go out tell your real estate investor buddy Dave about John’s property, and Dave agrees to buy it for $43,000. At closing, John sells his house to Dave, and you make $3,000. That’s wholesaling in a nutshell.
You should carefully research the your state’s laws around wholesaling real estate, but it can be a great way to make money with off-market properties.
There are a number of ways you can find wholesale deals. You can call on expired MLS listings, put up bandit signs, online ads or even check out FSBO listings on Craigslist.
Buy and flip
Thanks to HGTV, the world is in love with flipping houses, so this isn’t a concept that I need to explain in depth. However, people often assume renovating is a necessary part of flipping houses, and it’s not.
You can buy and flip houses without investing a dime in renovations or repairs.
As an agent, you can discover and research deals faster than the average buyer. Being able to jump on deals quickly and pay cash will maximize your chances of acquiring distressed properties at steep discounts that you can immediately turn around and flip for profit.
Now, in the event you’re thinking, “I don’t have cash to buy property!” — fret not. There are a number of companies that issue sizable personal loans or personal lines of credit that can help you get the cash you need to buy real estate.
Here are a few of them:
- Wells Fargo
- Best Egg
- Loan Depot
- Regions Bank
- Rocket Loans
Teach real estate classes
Teaching real estate classes can be another great way to supplement your real estate income. A simple internet search will uncover many real estate schools you could apply to.
Additionally, major job sites such as Indeed and Monster are great places to find companies looking to hire real estate course instructors.
You’ll want to check with your state to understand what the requirements are for becoming a real estate course instructor, but don’t overlook this opportunity.
BPO stands for “broker price opinion.” Like appraisals, BPOs are a broker’s opinion of value for a property.
Banks usually hire brokers to do BPOs to better understand the value of short sales or properties that are in foreclosure.
If you’re not a broker, ask your broker if BPOs are something you can help with for some extra cash.
Managing properties is another great way to supplement your income. Property managers typically take 8 percent to 12 percent of the gross monthly rent plus additional fees for finding tenants.
Although most states do require a broker’s license to manage property, some states have no licensing requirements at all. For property management laws by state, check out this site.
If you’re looking for more financial stability in your real estate career, you should think about creating multiple income streams.
Hopefully, the five strategies I’ve mentioned in this post will help you take your real estate career to the next level and achieve more financial security.
Brandon Jones is a licensed Realtor, real estate investor, and the founder of RealEstateHacks.net. He resides near Springfield, Missouri, with his wife and two sons.