Whether you’re searching for a new home or hoping to sell your current one, identifying the right type of real estate professional to work with can make a big difference to your success. There are various types of real estate agents, and it’s important to understand the role and expertise of each so that you can find the professional best suited for your needs.
Real estate agent
A real estate agent is a professional who represents individuals in the process of either buying a home or selling a home. Agents must pass an exam in the state where they intend to do business in order to obtain a real estate license. In addition, they must complete a certain number of hours of related coursework — the required amount varies from state to state. Agents can represent a variety of clients, from individual home buyers and sellers to property investors.
As of October 2024, there are about 4.3 million licensee records in the database maintained by the Association of Real Estate License Law Officials.
Realtor
While the two terms are often used interchangeably, Realtors and real estate agents are not exactly the same thing. A Realtor is a professional who not only has completed the relevant coursework and earned their real estate license, but is also a member of the National Association of Realtors (NAR), a trade organization in the real estate industry.
The word is trademarked, hence the capital R — it’s sometimes also written all in caps as REALTOR. Agents who are also Realtors are expected to pay dues and follow the organization’s rules and code of ethics. While it is entirely possible to be a fully licensed real estate agent who is not a member of NAR, such individuals cannot use the Realtor designation.
As of October 2024, NAR has about 1.5 million members.
Real estate broker
Another type of real estate agent you may encounter is a broker. Like other agents, a broker is a licensed professional who has undergone the required training or coursework and can help you with buying a new home or selling your current home.
However, a broker has more legal and financial responsibilities than an agent does. While agents are licensed to represent property buyers and sellers, brokers are licensed to oversee property sales. They ensure that the transaction is compliant with state and federal regulations, and that all paperwork is complete and correct. Unlike real estate agents, a broker also has the ability to move money in and out of escrow accounts.
A broker has also completed additional training and licensing beyond what a real estate agent has completed. An advanced state exam must be passed in order to earn the title of broker. Once an individual obtains that title, they can work on their own or run a real estate firm, hiring and managing other agents or brokers. In fact, real estate agents must work under the sponsorship of a broker or with a brokerage.
Specialized real estate professionals
Like other professionals, real estate agents often have specialities or areas of particular expertise. Some of the most common include:
- Listing agent: A listing or seller’s agent specifically represents the seller in a real estate transaction. As part of this role, the listing agent typically helps identify a fair asking price based on local comps, lists the property for sale, markets it and is the one who shows the home to buyers and hosts open houses. A listing agent will also serve as the point of contact for potential buyers and their agents. When offers are received on the home, a listing agent will review the bids and help negotiate a final deal on behalf of the seller.
- Buyer’s agent: A buyer’s agent, on the other hand, represents those seeking to buy a property. Their typical tasks include finding appropriate homes for buyers to visit, making recommendations regarding how much to offer for a home, and helping to negotiate a deal. Buyer’s agents may also recommend other professionals needed during the process, such as home inspectors. These agents can be especially helpful for first-time home buyers who lack experience navigating the purchase process.
- Dual agent: When a single real estate agent simultaneously represents both the buyer and the seller in a transaction, they are called a dual agent. Dual agency can be challenging because it may be difficult for the agent to fairly represent the interests of both parties, and there is a higher likelihood of a conflict of interest — after all, the amount of commission the agent earns is based on how much the home sells for. For this reason, dual agency is not legal in some states.
- Commercial agent: Commercial real estate agents typically focus on helping people buy, sell or lease properties that will be used for business or professional activities, as opposed to residential ones. Like a residential real estate agent, commercial agents must complete coursework and pass an exam to obtain a license.
NAR designations
NAR also awards specialized credentials for Realtors who undergo extra training and education in certain areas of expertise. These designations include:
- Accredited Land Consultant (ALC)
- Certified International Property Specialist (CIPS)
- Luxury Homes Certification (LHC)
- Military Relocation Professional (MRP)
- Seniors Real Estate Specialist (SRES)
Finding an agent
Buying or selling a home is one of the most financially significant transactions most people engage in. Finding an agent you are comfortable working with and can trust is an important first step — having the right agent as your guide can help make the process far less daunting.
Start the search process by asking friends or relatives to provide references to agents they have used and liked. It’s also useful to walk or drive around your area and take note of the names you see on yard signs — you want to work with someone who knows the market in your local area well.
Interview a few different candidates to see who you click with best. Professional designations or areas of specialty can be helpful in determining whose experience most closely matches your needs. Don’t be afraid to ask questions: The better you and your agent can work together, the more successful your real estate journey is likely to be.
FAQs
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Brokers undergo additional training and licensing that agents do not, which enables them to take on additional legal and financial responsibility. In addition, a real estate agent must work under a broker or with a brokerage firm — a broker, unlike an agent, is able to work on his or her own and may also hire and manage other agents.
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Real estate agents work on commission, receiving a percentage of a home’s final sale price. (So, the more expensive the home, the more the agents in the transaction earn.) The typical real estate commission is somewhere between 2.5 and 3 percent, though the amount can often be negotiated. Some agents will accept a predetermined flat fee for their services, rather than a percentage of the home’s sale price; only a very small number of them work on salary.
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No: There’s no requirement that you must hire an agent to sell your home. Many homeowners choose to go the “for sale by owner” route, in which they essentially act as their own agent and thus avoid paying a listing agent’s fee. However, having a skilled professional to help navigate the process is often worth the price, especially for inexperienced sellers — real estate transactions are complex and involve a lot of paperwork, and savvy marketing can help your home bring in a higher price.
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No. Similar to selling a home, you are not required to have an agent to purchase a home. However, it can be very helpful having a skilled professional on your side to help negotiate price and contract terms. Buyer’s agents can also be very helpful in locating properties that meet both your needs and your budget — they will likely know about listings and areas that you wouldn’t be able to find on your own.
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