The Difference Between a Real Estate Broker and an Agent?

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The real estate industry is full of many skilled professionals that assist clients with buying and selling homes, negotiating purchase offers and counteroffers, and more. But despite the wide variety of professionals in this industry, many people use the terms “real estate agent” and “real estate broker” interchangeably. In reality, both of these professions are distinct and have slightly different responsibilities. Although they both work in the real estate industry, real estate agents and brokers are not the same things.  Understanding the differences between real estate brokers and agents will help you determine which of the two you need to contact if you're looking to buy or sell a home in the near future.  Let’s take a look at the differences between these real estate professionals in detail.

What is a Real Estate Broker? 

A real estate broker is fairly similar to a real estate agent, although they do slightly different things and have different limitations. In many ways, brokers are managers or leaders for several agents. Agents usually report to brokers and share their commissions with them (and sometimes vice versa, but not always). Real estate brokers come in three types:

  • Associate real estate brokers have official brokerage licenses but work underneath another broker or broker association.
  • Managing real estate brokers cover daily operations and transactions in a bigger broker office. They may also have other managerial duties, like training new brokers, managing administrative staff, and more.
  • Designated or principal real estate brokers supervise incoming real estate agents and ensure that everyone complies with national and state real estate laws. Any given real estate office will have one designated broker only.

As you can see, real estate brokers and agents will often work closely together.

What Do Real Estate Brokers Do? 

As “brokers,” these professionals work with buyers to look for properties that either completely or closely match criteria set by their clients.  Additionally, brokers can:

  • Conduct real estate negotiations
  • Prepare purchasing offers for buyers
  • Assist buyers with the issues that lead up to closing the deal
  • If they’re sellers’ brokers, they can help to determine fair market value for client properties
  • List and show properties
  • Talk to sellers about particular offers and advise them about which ones to take
  • Assist with other parts of the property selling process

In other words, real estate brokers are versatile professionals that can help both home buyers and sellers with the entire procedure.

How Are Real Estate Brokers Paid?

A real estate broker earns money by taking a cut of the commission received from various real estate agents who work beneath them. You can think of real estate brokers as managers or officers of a real estate company in some ways. The agents are the people who actually go out and meet directly with clients or find properties (though brokers can also meet with clients directly). Furthermore, real estate brokers often make their deals and can earn commissions from those. Unlike real estate agents, as described below, they do not have to split the commission from these deals with the rest of their office.

What is a Real Estate Agent? 

A real estate agent is a professional who carries a license to help people sell, rent, or purchase real estate or other properties. Depending on the licenses they hold, real estate agents can be qualified for assisting with different types of property transactions, although most have a license to help buy or sell homes rather than other pieces of property like farmsteads, commercial buildings, etc. Overall, real estate agents focus on connecting buyers and sellers and are typically paid a commission for their services. Real estate agents may be called real estate salespeople or real estate associates as well, depending on the official titles used at the company where they are employed. Most real estate agents do not work individually (although some do). Real estate agents have to acquire several qualifications in order to acquire licensure. These requirements can vary from state to state, as there are no federal requirements. But most states require qualifications like:

  • 18 years or older
  • Legal residency in the US
  • Completion of a pre-licensing class (dependent on the state)
  • Completion of a required background check
  • Sponsorship by another licensed real estate broker (not an agent, see above)
  • Taking and passing a state real estate exam
  • Completing more continuing education courses if they want to maintain their license

These requirements may seem like a lot, but working for a real estate agency is a viable career opportunity for many types of personalities.

What Are Real Estate Agents’ Responsibilities? 

Real estate agents are primarily focused on organizing transactions between buyers and sellers. However, they can also help facilitate transactions or agreements between homeowners and renters. Think of real estate agents as designated officers that communicate between any two real estate transaction parties, particularly if the prospective buyer and seller of a property do not live close together. For example, agents may:

  • Carry offers or counteroffers between the parties.
  • Discuss queries or points of contention between the parties.
  • Work with other agents to guide clients through the buying and selling process.
  • Help clients fill out all necessary paperwork.
  • Ensure that their clients know about any fees or costs, particularly during the closing process.
  • Fill clients in on important dates and procedures, such as home inspections and final closing dates.

If a real estate agent is a listing agent (an agent specializing in representing home sellers), the real estate agent may also:

  • Help the homeowner to set an appropriate listing price.
  • Suggest improvements or updates to help boost the home’s value.
  • Assist with home staging (i.e., setting up attractive furniture or cleaning the home).
  • Marketing the home through the MLS or Multiple Listing Service for their channels, such as online websites.
  • Negotiating sales prices and closing costs.
  • Helping to submit and file important documents.

If a real estate agent specializes as a buyer’s agent, they may:

  • Find properties that are suitable per their client’s requirements or desires
  • Find properties within appropriate price ranges for their clients
  • Arrange home appraisals and inspections
  • Negotiate terms
  • Help prepare, submit and file important documents

Regardless of the exact type of real estate agent, each agent has a lot of responsibilities. But they get paid excellent money if they do a good job.

How Are Real Estate Agents Paid? 

Real estate agents usually work for agencies or brokerages. As a result, they are paid on a commission basis, so they get paid on a percentage of the sale price for a property. Thus, the more expensive the property they sell or help their client to buy, the higher their potential commission. Commission rates are negotiable but are usually between 5% and 6% of the total purchasing price. Real estate agents also don’t usually take home the entire commission but instead take home a part of the commission. The commission overall is divided between the listing agent, buyer’s agent, the brokerage firm that the agents work for, and others, if necessary. For example, if a listing agent sells a home for $200,000 with a 6% commission rate, they may only see 1.5% of that total sales price. Thus, they would only get $3000 for the sale.

Are Either of These the Same as a Realtor? 

No. But either a real estate broker or agent can be a realtor in addition to their primary job title. To be a realtor, you have to be a member of the National Association of Realtors or NAR, which is a trade commission. Technically, a realtor can be a real estate agent, a salesperson, a property manager, appraiser, real estate broker, and more. A realtor can be any real estate professional provided they have additional licenses. Realtors have their own special licenses and have to pay annual membership dues. In exchange, they get various benefits, such as access to new property listings, better networking capabilities, and more. Many real estate brokers or agents who want to stay in business over the long term may become realtors as they develop professionally.


The differences between real estate agents, brokers, and realtors can be a bit obscure and complex. But the above breakdown should help you identify which real estate professional you need if you want to buy or sell a property for its maximum value. Want to know more about how to get into the real estate market and maximize your profit potential? Or do you need to know how to get a loan to buy a house in the first place? In either case, you should check out Seek Capital’s guides and personal funding options.  Sources: Broker vs. Realtor vs. Real Estate Agent | Investopedia Value of NAR Membership | NAR, Real Estate Agent, Broker | Salaries & Compensation How To Become a Real Estate Agent | Investopedia

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