If you are considering buying or selling a home or property and plan on using a real estate professional, it is important to know the difference between a real estate broker, real estate agent and a realtor. Many people use the terms interchangeably, however, they are different – especially when it comes to their qualifications and the investment they’ve made in their education in the real estate industry.

A real estate agent is an industry professional who completes a standardized course and passes all required tests, as well as a real estate licensing exam in the state in which they intend to work. Agents represent buyers and sellers.

As part of their services, they provide expert advice in valuing your home, list it for sale, actively market the property and bring buyers to the table. However, an agent cannot act on their own. They are required to work under a licensed real estate broker to fully engage in a real estate transaction. So, when you work with an agent to buy or sell your home, you are actually working with someone who is employed by a real estate brokerage.

Agents are responsible for negotiating offers and counteroffers between parties, field questions about the property and the surrounding neighborhood, and facilitate inspections and repairs. Agents can also make professional recommendations, like attorneys, title and inspection companies. There is a lot of paperwork involved in buying a home.  Your agent will work with your attorney to facilitate necessary documents, disclosures and contracts. Real estate agents provide their clients insights into the purchase and sale process, including timelines, closing procedures, and other relevant contractual responsibilities.

Real estate brokers have a higher level of licensing, which requires more classwork hours and a tougher exam. Brokers supervise and guide agents to make sure transactions are accurate and that all contracts, listing documents and protocol is up to par. Brokers can handle real estate transactions independently and can operate their own brokerage company – representing both buyers and sellers alike.

Brokers conduct negotiations, prepare offers and help buyers and sellers with all matters leading up to the closing. They determine market values of the properties owned by their clients, list and show properties, communicate with sellers about offers, identify opportunities for their buyers and assist in moving the closing process along swiftly.

Like real estate agents, brokers receive a commission once a sale is completed. The commission rate is listed in the contract between the broker, and the buyer or seller. The listing agreement or contract generally outlines how much of a percentage of the sale will go to the broker.

The term “realtor” is a trademark of the National Association of Realtors (NAR).  Although the word “realtor” is commonly confused with a “real estate agent”, the designation is open to a variety of professions within the real estate industry, including residential and commercial real estate brokers, salespeople, property managers and appraisers in addition to brokers and agents. So, just hiring a realtor without being a licensed agent or broker can be an issue. Realtors are bound by a code of ethics set forth by the NAR and must be experts in their fields. To become a member, a real estate professional has to agree to abide by the association’s standards and uphold its code of ethics.

Real estate agents and brokers are paid on a commission basis, based on a percentage of the property’s sale price. Hiring an agent or broker to sell your home will reduce the net proceeds from your sale, however, brings value to the sales process. Whether it is listing your home at the right price, marketing your home effectively or presenting viable offers by pre-approved, reliable buyers, the benefits are worth the cost.

When considering purchasing or selling your home, finding the right real estate professional is paramount to the success of your transaction.

If you are buying a home, it is important that your agent or broker understands your needs, has good communication skills and has the time to work with you to find your ideal home. If selling your home, it is important to find a real estate professional that understands what buyers are looking for and advise you on how to most effectively prepare your home to sell. They should be able to work around your schedule and provide you with a realistic market value for your home. A broker or agent that tells you they can get more money for your home than another broker or agent is not necessarily a better choice, and can cause your home to sit on the market longer than necessary.

Christine DeHart, Broker/Owner     Salmon Real Estate

(718) 273-1200              salmonrealestate.com