Comstock Images/Stockbyte/Getty Images

Real Estate Agent Vs. Broker

Growth Trends for Related Jobs

A real estate agent is a salesperson licensed to facilitate real estate transactions in a particular state. A broker can perform sales activities, but brokers also own, operate and manage real estate offices. Each state has laws regarding licensing qualifications and roles for each professional, but some commonalities exist across the country.

Basic Roles

Real estate agents represent buyers or sellers in the sale of property. Agents can specialize with buyers or sellers, or work with both types of clients. The primary duties of an agent include marketing home listings, representing clients throughout the selling or buying process, managing negotiations and contracts, and helping clients through closing.

Brokers oversee the activities of sales agents in a brokerage or real estate office. In many states, an agent is required to work under the direction of a licensed broker to acquire and maintain licensing. The broker ensures that sales agents act ethically and professionally in their activities. Brokers conduct their own, independent real estate business as well.

Background Requirements

The basic elements of licensing requirements are similar in many states for agents and brokers. Standards are just escalated for brokers. Prelicensing classes, exams and background checks are common requirements. Specific hours needed vary by state for an agent.

Brokers have to complete additional classes related to broker responsibilities. Someone must also be an active salesperson for one or two years to get a broker's license in many states. A minimum age, often 18 for agents and 21 for brokers, is also typical for broker licensing.

Scope of Role

The primary role of a real estate agent centers on client interaction. Agents are professional marketers, salespeople and service people all in one. A listing agent identifies people looking to sell a property and helps them prepare it and market it for sale. A buyer's agent works closely with buyers to look at properties and make an offer.

Brokers have much broader opportunities to perform real estate activities. In a traditional office, brokers are managers of a business and earn money based on the success of agents and the business. Many brokers work as real estate property managers or engage in property investment activities as well.

Additional Considerations

When someone lists a home or buys a home, the contracts are typically generated by the brokerage firm. The seller pays a commission on the sale to the broker. Commissions are paid to the seller's agent and the buyer's agent, and then the firm retains a percentage based on its agreement with agents. Agents and brokers both have legal and ethical responsibilities to operate fairly with clients. Agents are generally responsible for their actions, and brokers may be held responsible for any illegal activities carried out in their business.

Some states, including Indiana, have eliminated the "salesperson" or "agent" designation, and simply license all real estate professionals as brokers. This move is intended to simplify licensing laws and raise the bar on real estate qualifications.