Many people assume that real estate agents and brokers do the same job, but in reality, there are important differences between these roles. Whether you're a buyer, seller, or an aspiring real estate professional, knowing the distinction can help you navigate the industry with more confidence. In this blog, we’ll explain what separates an agent from a broker, the qualifications required for each, and why understanding this distinction matters in real estate transactions.

Real Estate Agent vs. Broker

Real estate agents and real estate brokers are essentially different stages of the same profession. Both job titles enable you to facilitate real estate transactions, but agents (sometimes called salespeople) require supervision to practice. Brokers don't.

It's worth noting that in some states, including Washington, the first level of licensing is called "broker" instead of agent or salesperson. As a result, the next level of licensing is "managing broker." It's the exception rather than the rule, but it certainly adds to the confusion.

Real Estate Agents

Real estate agents are responsible for connecting buyers and sellers to facilitate the sale of "real property" (commonly known as real estate).

To become an agent, an industry professional must take and pass all mandatory state-specific courses and fulfill the state's licensing requirements.

Once they receive their real estate license, a real estate agent must work for a brokerage under the supervision of a licensed broker. They cannot work independently.

Responsibilities of a Real Estate Agent

All real estate agents have the following common responsibilities:

1. Match a Buyer to Available Properties on the Market
Real estate agents – whether representing buyer or seller – aim to match buyers and properties based on the buyer's needs, neighborhoods of interest, and the property's attributes. For seller's agents, this is largely through marketing.

2. Submit Offers and Negotiate
After a buyer finds a property they are interested in purchasing, real estate agents submit an offer and facilitate the negotiation until terms are agreed upon by both parties.

3. Finalize Purchases
Real estate agents are responsible for guiding clients through the finalization of purchases. They complete tasks such as finalizing paperwork, facilitating repairs and inspections, and navigating the closing of the sale.

Real Estate Agent Compensation

Real estate agents typically earn a commission based on the sale price of a property. In most cases, this commission is split between the buyer’s agent and the seller’s agent.

However, agents also need to share their portion of the commission with the broker they work under. The exact split can vary depending on the brokerage, the agent’s experience, and negotiated agreements. As a result, agents often have less control over how much they get paid, as they are subject to their brokerage’s policies.

Real Estate Agent Time Commitment

Real estate agents often have more flexible schedules, which can be one of the appealing aspects of the job. However, this flexibility can also lead to long or irregular hours, as agents must be available when their clients are – often on evenings or weekends.

The amount of time an agent spends on the job can vary based on market conditions, the number of clients they are working with, and the complexity of the transactions.

Types of Real Estate Agents

There are two main ways to divide real estate agents: residential vs. commercial, then by role.

Agents typically have to commit to either residential or commercial real estate. It's rare for an agent to do both, and typically only in rural markets.

Within both residential and commercial real estate, there are buyer's agents and seller's agents. Some agents take on both types of clients, while others choose to specialize in buyers or sellers. Either way is fine, but it's ethically dubious (and sometimes illegal) to represent both the buyer and the seller in the same transaction.

Type of Agent	Job Description
Residential Agent	Residential real estate agents specialize in individual residences like houses, condos, or townhomes. Most agents go into residential real estate because it's a bigger market.
Commercial Agents	Commercial real estate agents specialize in commercial properties. This career path often requires advanced education – at least a bachelor's degree. Commercial agents often specialize in types of commercial property.
Seller's Agent (Listing Agent)	A seller's agent (also known as a listing agent) is responsible for representing the person who is selling the property in a real estate transaction. These agents have extensive knowledge of local housing markets and are excellent at negotiating and moving quickly throughout the selling process. A seller's agent has the following responsibilities: List the home or property on a variety of listing services Coordinate and schedule showings of the property Price the home or property being sold Advertise and market the property to potential buyers Negotiate prices and conditions for the seller Help the seller with closing paperwork
Buyer's Agent (Selling Agent)	A buyer's agent (also known as a selling agent) works with the individual who is purchasing real estate or real property – the buyer. Buyer's agents are industry professionals who understand the complex transaction process and who have in-depth knowledge of local housing markets so that they can present the buyer with properties that match what they might be looking for. A buyer's agent has the following responsibilities: Locate unique properties that meet the needs of the buyer Help buyers with financing Showing buyers the merits of different properties Works to negotiate fair pricing of properties Help the buyer with closing paperwork

Real Estate Brokers

Brokers are more advanced real estate professionals. To become a broker, professionals need to complete a certain number of years as a real estate agent and then earn the next level of real estate license. That involves repeating the licensing process, including the completion of broker's pre-license courses.

This additional experience and education permit them to take on advanced duties like supervising other agents, handling certain financial and legal aspects of a transaction, and owning a brokerage.

The requirements for becoming a broker are different in every state. For example, Colorado brokerage licensing requires completion of a 24-hour Brokerage Administration Course, two (2) years of active real estate experience, and meeting the requirements of Colorado Rule A-27. In Texas, on the other hand, the requirements are much more extensive – agents who wish to become brokers must have four (4) years of active experience and complete 270 hours of qualifying education, including the Brokerage Administration Course.

Responsibilities of a Real Estate Broker

Real estate brokers are still allowed to do everything real estate agents do, but they have a heightened level of responsibility.

1. Perform an Agent's Duties Independently
A broker's license provides you with the ability to become legally responsible for the entirety of a real estate transaction. That means you no longer need the supervision of a senior agent – you can handle the whole transaction on your own.

As a result, brokers who continue to work directly with clients often have a better commission split with their brokerage.

2. Supervise and Guide Agents
A broker's license allows real estate professionals to supervise and manage agent-level licensees. They provide guidance and mentoring in exchange for part of their supervisees' income. The flip side is that they become legally responsible for the actions of every agent under their purview.

3. Ensure the Legality of Transactions
The reason that brokers can work independently or supervise other agents is that they're allowed to handle certain financial and legal steps in the transaction process that agents cannot. Brokers can move money in and out of escrow accounts and mediate legal disputes that arise from the transaction.

Ultimately, brokers are responsible for ensuring that a transaction is completed lawfully, that the paperwork is correct and complete, and that all monies are recorded and reported properly.

4. Own a Brokerage and Hire Other Professionals
Brokers are legally able to start or purchase their own brokerage, hire other real estate agents and brokers, assume responsibility for all transactions, and benefit from them financially.

Broker Compensation

Brokers generally have more flexibility and control over their earnings. While brokers can also earn commission on sales, they often have additional income streams, such as earning a portion of the commissions from the agents they supervise.

For brokers who own their own firm, they benefit from the overall profitability of the brokerage. This additional responsibility allows brokers to increase their income potential.

Broker Time Commitment

Brokers generally have a greater time commitment. In addition to working with clients, brokers also manage and supervise agents, review contracts, and ensure that all transactions are legal and compliant.

For those running their own brokerage, there are even more demands, including overseeing the administrative and financial aspects of the business. This added responsibility means that brokers are likely to spend more time managing their operations, even if they are no longer directly handling as many client transactions.

Types of Real Estate Brokers

Not all brokers choose to exercise all these responsibilities, and the degree to which they assume responsibility determines what type of broker they are.

Type of Agent	Job Description
Associate Brokers	Associate brokers continue to work directly with clients under another broker. They use their license to handle transactions independently. Typically, they do not supervise other licensees. The title also indicates that they're not a managing or principal broker.
Designated Brokers	Designated brokers take legal responsibility for the actions and transactions of all brokers and agents underneath them. The title indicates legal liability only. Many designated brokers have active supervisory duties, especially down the chain. Upper-level designated brokers are ultimately responsible for their employees’ actions, but they may not take an active role in mentoring or managing.
Managing Brokers	Managing brokers take hands-on responsibility for the daily operation of the brokerage. They are often designated brokers responsible for transactions, but not always. The title means that they take an active role in operational responsibilities like managing all staff and overseeing the administrative aspects of the firm.
Principal Brokers (Broker-Owners)	The ultimate designated broker within each brokerage is its principal broker. All brokerage transactions are ultimately legally their responsibility – the buck stops with them. Each brokerage must always have a principal broker. Principal brokers who own part or all the brokerages are known as broker-owners.
Property Manager	A broker's license also allows you to leave the world of sales brokerages behind altogether and become a property manager. Property managers develop, manage, and administrate rental properties on behalf of the owner, whether these properties are apartment buildings or shopping centers.

Choosing the Right Real Estate Career With VanEd

Choosing a career between a real estate agent and a real estate broker depends on what you are looking for.

Some real estate agents are happy to continue working with their team. They enjoy having the available resources their brokerage offers. Working for a brokerage provides an agent with brand presence, networking opportunities, and one-on-one training. However, for self-motivated agents who aspire to be their own boss, becoming a broker may be an important step in their career.

Ready to kickstart your real estate career? Head over to the VanEd website to take a look at our catalog of real estate license courses or take your career further with our real estate continuing education courses!

Written and Published by: VanEd