The real estate industry is huge, with over 2 million real estate agents in the United States. You would assume many pursue a college degree in real estate. There are many more real estate investors, lenders, mortgage brokers, contractors, inspectors, title companies, and more that build their business around real estate. I am a Realtor, I invest in real estate, and I think the real estate industry is an amazing opportunity for anyone. However, when people think about a career and going to college, there is very little mentioned about real estate. Some colleges offer a few classes in real estate as part of a broad business degree, and there are a few masters degree programs in real estate and real estate investing. Here is a great article on how much a real estate agent can make.
I think there is a huge opportunity in the real estate industry to make a lot of money for agents or investors. I detail a lot of my investing strategy in my complete guide to investing in long-term rental properties. One question many people have is how to get a formal education in real estate investing. Every state offers real estate classes for those interested in becoming an agent, but those classes teach almost nothing about real estate investing. Here is an article on how hard it is to become a real estate agent.
The problem with getting a college degree in real estate or real estate investing is there are very few options. To get a formal degree in investing in real estate you have to go to four years of college, minor in real estate and you might get one class about investing. You could also go to four years of college majoring in any degree and then get a master’s degree in real estate investing where they will teach you a lot about investing. To be honest I have never met anyone that has a master’s degree in real state investing, and I don’t know exactly what a master’s degree in real estate investing teaches. Here is a great article on the top ten colleges for real estate degrees.
Problems with getting a real estate degree in investing
- Investing in real estate is an extremely localized venture. What works in some areas may not work in others when investing in real estate. My friend Ben Leybovich only buys multi-family homes. He can buy a four-plex that produces $2,000 in monthly rent for $120,000 in his town. Where I am, that same four-plex with the same rent would cost $220,000 or more. Even if I got a great deal and bought the four-plex below market value, it still wouldn’t cash flow as well as the single family homes I invest in. Knowing your market is more important than anything when investing in real estate.
- The real estate markets and lending regulations are changing all the time. You have to be in the business and constantly aware of changing policies to be successful. I find it very hard to believe college course curriculum could be updated every year to keep up with these changes.
- There are many different real estate strategies and places to buy real estate. Many investing strategies work for many different people. My question to colleges that offer masters degrees or minors in real estate is: how do you ensure you are teaching all the options?
- Who are the instructors that are teaching the college classes? Are the instructors actual investors making money right now, retired investors or are they educators who have never practiced investing. I want to learn from investors who are making money now in the current market.
- Every state has specific real estate laws and practices. What works in one state may not work in another or even be legal. There is no way colleges can teach and keep up with the individual state laws.
How much will a real estate degree cost?
I wrote an article about who do you listen to when investing in real estate. There are many gurus looking to make a quick buck who have never bought a real estate investment. They can charge $20,000 or more for their real estate programs that assume everyone is the same and all state laws are the same. I suggest you run from them as fast a you can, but is a college that charges you $30,000 or more for a blanket education that takes four years or more a better deal? Not only do you have to factor in the money that a real estate degree will cost you, but you have to factor in the time it takes and the opportunities lost when going to college. I wish I would have begun investing much sooner than I did. At least with the real estate guru you will realize you wasted your money in a couple of months and be able to move on with your life.
Real life experience is the best teach for real estate investors
I am not saying college is bad for everyone, I went to college and received a bachelor’s degree in business finance. I loved college! I loved the friends I met, moving away from home, the freedom and going to Mexico for spring break. The classes were okay, but if my main goal back then was to make as much money as possible I would have to say my college degree was not worth it. If your goal is to work in the finance world, become a doctor or another professional service that requires a degree then I would say you need to go to college. If you only want more information on investing in real estate, I don’t think a college degree is worth it.
The best way to learn about real estate investing is to do it. Take that money that you would have spent on a college degree or real estate guru and buy a house with it. Chances are you will learn a lot more and have a lot more money left over. I don’t think you should buy a house without educating yourself, but you can do that online. There are thousands of books on real estate and real estate investing. Chances are you will learn something from each book that you read.
Do state real estate license classes teach about investing?
Many investors think about getting their real estate license so they can take the real estate classes and learn about investing. Think again, those courses teach you how to become a real estate agent. State real estate courses have almost no information on real estate investing and most people are extremely disappointed with the information provided as they are mostly about laws and things you should do to keep your license. If you want to get your license and sell real estate then take those classes, but not if you are an investor looking to learn how to buy cheap houses. I do highly suggest investors get their real estate license if they want to be a serious investor.
There are real estate degrees available for people who want to learn more about the industry. In my opinion they are not worth it for investors, and in some cases may not be worth it for real estate agents either. Some states will accept a college degree in real estate in lieu of the state courses, but some do not. You may take four years of college and then still have to take the additional 100+ hours of state education required to get a real estate license. Learn by actually investing in real estate. If you did your homework, you will make money while you are learning instead of going into debt.
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