People use the phrases Realtor and real estate agent interchangeably, although they're not the same. Both must have a licence to sell real estate, but there are several key differences. Realtors aren't all real estate brokers.
Real Estate Agents
A real estate agent is a person who is authorized to assist in the purchase, sale or rental of real estate. They are paid a commission for their efforts—typically a percentage of the property's sale price—which they use to bring buyers and sellers together. Real estate associates and real estate salespeople are also real estate agents. Each state has its licensing standards for real estate agents (there is no federal licence).
It is a Realtor's job to represent buyers and sellers in real estate transactions. Active membership in the National Association of REALTORS® (NAR) must be considered a REALTOR® in the United States. The National Association of Realtors (NAR) requires its members to complete training, pass a licencing exam, and sign a code of conduct. Realtors are expected to put the interests of their clients ahead of their own by this code of ethics.
What Does a Real Estate Agent Do?
A real estate agent is a person who facilitates the exchange of ownership and rental interests between parties interested in buying and selling real estate. Agents handle all bids and counteroffers and any questions the parties may have.
When an offer is accepted, an agent will liaise with another agent to assist customers in completing the necessary documentation. As a result, they ensure that their customers are informed of all of the steps they need to do to close the deal, including house inspections and relocation plans.
How do Real Estate Agents Make Money?
Real estate brokers get paid a commission if they assist a client in purchasing or selling a house. A typical commission is between 4% and 6% of the sale price of a particular property, which is distributed among the brokers and agents engaged in the transaction. How much commission would you pay if you were to put your home on the market for $350,000?
A $5,250 would be split equally between the listing agent and broker, based on a 1.5 per cent commission split. The buyer's agent and the broker would be paid the same sum. Real estate brokers frequently work with many customers at once to maintain a steady flow of commissions.
Work of Realtors
An active member of the National Association of Realtors is referred to as a "Realtor" (NAR). A licenced real estate agent in the United States can assist customers in purchasing or selling commercial or residential real estate. However, not every real estate agent is also a Realtor, and vice versa. As a member of the NAR, Realtors can be property managers, real estate consultants and brokers, and home appraisers.
Each state in the United States has its licencing requirements for real estate agents. According to the Bureau of Labor Statistics, most states need a minimum of 30 to 90 hours of classroom training in real estate basics from an authorised college, university, or technical school.
Real Estate Agent vs Realtor: What Is the Difference?
The state licences real estate agents to help people purchase or sell homes. There are a few distinctions between real estate agents and members of the National Association of Realtors (NAR).
Requirements for Realtors
This is only the beginning of what a Realtor can do; they may also be a broker-associate, a managing broker, or a sole buyer's agent. To join, Realtors must agree to follow the Realtor Code of Ethics, divided into 17 sections, each of which has a different set of Standards of Practice.
NAR's Code of Ethics
Local real estate boards closely follow the NAR Code of Ethics, created in 1913. Instead, it's not merely a set of standards that agents promise to uphold because their brokers made them join the Association. The rules are far stricter and more rigid than the state guidelines that control agents.
The 17 Articles
Each of the 17 Articles is important, but the first one takes centre stage. As a result, a Realtor's approach to business must be built on this foundation. When acting as a buyer's agent, a Realtor is not required to be fair to all parties but rather honest with the buyer and the seller's representative.
Conditions for Personnel Working as Agents
In most states, real estate agents must be at least 18 years old and have a high school diploma or GED to operate as a realtor. A four-year college degree is rarely or never necessary.
They must next take and pass the state's licensure test, approved by the state. A real estate licence may then be obtained. Continuing certification is required in several states.
For certification, Realtors must complete a course on the National Association of Realtors' Code of Ethics and retake it every four years.