Real Estate Agent vs Broker vs Realtor®

Written by: Ethan Peyton

Last updated:

A career in real estate can take many paths. For many real estate professionals, a successful and rewarding career  means working as a home buying and selling expert, using their knowledge to get the best purchase contract for their home buyer or seller client. This person can be a real estate agent, broker, or Realtor®.

A real estate agent and broker each have a distinct license, while a Realtor® is a professional designation given to those agents or brokers who are members of the National Association of Realtors®.

To determine what career path you want to pursue, it is helpful to understand what a real estate agent, broker, and Realtor® do as part of their job and what is required for each career path.

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Real Estate Agent, Broker, and Realtor®: What They Do

First, we’ll consider what each of these real estate professionals do as part of their work:

  • real estate agent is licensed as a real estate salesperson to represent a home buyer or seller in a real estate transaction. They must work under a licensed broker, either as part of a team that works together or an agent who works independently but still falls under the broker’s professional license.
  • real estate broker is licensed to work independently to represent a home buyer or seller in a real estate transaction. Some own their own brokerage firms and have agents that work under them, while others work on their own as part of a larger firm. A broker can act as a real estate salesperson during a real estate transaction.
  • Realtor® is a designation given to a real estate agent or broker who is a member of the National Association of Realtors® (NAR). To become a member, the agent must agree to the NAR’s code of ethics.

What is the Difference Between a Real Estate Agent and a Broker?

The main differences between a real estate agent and a real estate broker are experience and licensing. A real estate broker must complete additional real estate coursework and pass a longer exam.

Most real estate professionals who want to work directly with clients begin as a real estate agent. You do not need any experience to become a real estate agent, although you will need to learn quickly to become a top real estate agent.

Brokers have more experience and almost all states require that new real estate professionals work as agents for some time period before being eligible to apply for a broker’s license.

Becoming a Real Estate Agent vs. Broker

Both real estate agent and broker licenses are regulated by each state. This means that states have different requirements for pre-licensing requirements, such as education and experience.

For real estate pre-licensing education, StateRequirement recommends: How to Become a Real Estate Agent.

Almost all states require real estate brokers to have more experience and knowledge than real estate agents. Given that brokers are licensed to lead a team of agents, this higher standard is necessary to ensure that they have the knowledge, experience, and skill to take on a leadership role.

Required Education for a Real Estate Agent and Broker

All states outline specific professional education requirements for a real estate license. Those requirements are generally longer and more in-depth for the real estate broker license than the real estate salespersons license.

Consider the following example:

In Texas, real estate agents must take 180 hours of real estate pre-license coursework, completing each of the following topics:

  • Principles of Real Estate I and II
  • Law of Agency
  • Law of Contracts
  • Promulgated Contract Forms
  • Real Estate Finance

Those wishing to become a real estate broker in Texas need to complete 270 hours of pre-license coursework. They take classes in the same areas as real estate agents, with Real Estate Brokerage as an additional requirement. The state does not specify a timeline for course completion, other than to say that the Real Estate Brokerage course must be completed within two years of the broker’s license application.

Brokers also need to document 630 hours of approved continuing education in topics such as:

  • Real Estate Appraisal
  • Real Estate Law
  • Real Estate Marketing
  • Real Estate Math
  • Property Management
  • Real Estate Investments
  • Residential Inspections for Real Estate Agents

Brokers in Texas can also use college courses or a bachelor’s degree to satisfy their education requirements, as long as they cover the required topics. You can check with your state authority to see if this applies to you.

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Additional Experience Requirement for a Real Estate Broker

Real estate brokers must document their professional experience as part of their license application. In Texas, you must have worked as a real estate agent for at least four of the last five years. Documentation of this experience includes a copy of your agent license as well as a list of the transactions that you claimed during this period.

How to Become a Real Estate Agent

Prospective real estate agents and brokers in Texas both need to pass a real estate exam. As expected, the broker’s exam is longer and more comprehensive than the real estate agent exam. Both require careful preparation and study.

In most states, the real estate license salesperson exam consists of 100-150 questions. It is often divided into a national section and a state-specific section. In Texas, the national section of the exam consists of 80 scored questions and the state section consists of 30 scored questions.

How to Become a Real Estate Broker

The broker’s exam often has more questions and covers more information. In Texas, brokers take the same national section as real estate agents. The state section of the broker’s exam consists of 50 scored questions, including 10 case study scenario-based questions.

A test prep course can help both real estate agents and brokers prepare for their state real estate licensing exams.

Job Responsibilities of Real Estate Agents and Brokers

A real estate agent and a real estate broker often do similar tasks, but their day-to-day routines can look different. Real estate agents focus on working with clients on individual real estate transactions, while brokers have the added responsibility of managing a team or business.

What Does a Real Estate Agent Do?

There is no such thing as a “typical day” for a real estate agent, an exciting and fast-paced aspect of the career that many agents enjoy. Some of the duties that take up the majority of a real estate agent’s time include:

  • Meeting with clients to determine their needs
  • Showing homes to prospective buyers
  • Conducting market research 
  • Researching homes for sale on the Multiple Listing Service (MLS)
  • Preparing and submitting purchase paperwork and contracts
  • Arranging inspections and repairs for homes

Realtors® have access to the MLS to be able to conduct a search for homes for sale quickly and efficiently. Other search platforms can be helpful, but the MLS database is the industry standard and the most commonly used search tool.

What Does a Real Estate Broker Do?

A broker’s day includes many of the same tasks as a real estate agent, especially if they work directly with clients. Many brokers take on the additional responsibilities of leading a team of agents. Some even start their own brokerage business.

In addition to the work done by real estate agents, many brokers also spend time:

  • Applying for and maintaining business licenses and documentation
  • Handling payroll for the agents in their team or company
  • Manage office staff and administration
  • Network to bring new business or agents to their team

Real Estate Agent vs. Broker Salary

With the increased work and responsibilities of a real estate broker comes a higher salary. Most real estate agents and brokers are paid on commission. They receive a percentage of the sales price of homes that they help a client buy or sell.

Real estate agents make an average of $48,930 per year, according to the Bureau of Labor Statistics. Brokers average $59,720 per year. Brokers with a team of agents who work for them often earn a small percentage or fee of the sales that members of their team make.

Earnings for both real estate agents and brokers can vary. Those who specialize in luxury or high-cost markets often earn more than those in less expensive areas. The real estate industry is more active during the summer months, leading to higher earnings for both agents and brokers during this time compared to the slower winter and holiday months.

Why Does a Real Estate Agent Need a Broker?

The simplest reason that real estate agents need brokers is because it is a condition of their state license. Most states’ real estate agent license requires an agent to be employed by a broker with a valid broker’s license.

There are a few significant benefits to working under an experienced broker, especially for new real estate agents.

  • A broker has a more extensive network, which can help new agents make professional connections and more sales.
  • As an agent, you can concentrate on working with clients and making sales, leaving the business tasks to the broker.
  • You can benefit from a broker’s experience and knowledge, coming to them with questions as you learn about real estate.

What is an Associate Broker in Real Estate?

Not all states classify brokers into different categories. One of the most common designations in the states that do provide different classifications is an Associate Broker. Being an Associate Broker can mean that you are able to work independently, but not supervise other agents. You may need to take a broker’s exam to be licensed as an Associate Broker.

Some states use Associate Broker (or Associate-Broker) and Real Estate Agent interchangeably to refer to a sales agent who does not have an independent broker’s license. In this case, you need to be affiliated with or supervised by a broker in order to do business.

The important distinction is that in order to work for yourself without supervision and lead a team, most states require that you have a full broker’s license. Learn more about your state’s requirements and how to become a real estate salesperson to see which path works best for your situation and professional goals.

What is the Difference Between a Real Estate Agent and a Realtor®?

A Realtor® is a real estate agent who is a member of the National Association of Realtors. Many use the terms real estate agent and Realtor® interchangeably, often because these individuals do the same work and have the same state license.

Members can enroll in their local, state, and national associations when joining the Association of Realtors® (AR). This is a great way to network with real estate professionals in your area and participate in larger events, like conferences. You can also receive discounts on some professional services and software.

National Association of Realtors®: This professional organization provides training, expertise, networking, and the important Realtor® designation to its 1.4 million members.

State Association of Realtors®: Each state operates its own independent association. This is a great resource for state-specific licensing information and requirements, as well as training geared toward the real estate market in your area.

Local Association of Realtors®: The best place to network with other real estate professionals in your city or region, the local association is often the most active place to participate. You can take on a leadership role to build your own network and reputation. Some Realtors® choose to join multiple local associations if they work in a geographically broad real estate market.

All members must adhere to a code of ethics that goes beyond the legal requirements of your real estate agent or broker’s license. Many home buyers and sellers like to work with Realtors® because this professional designation means that their agent or broker is committed to acting in an ethical way.

“The term REALTOR® has come to connote competency, fairness, and high integrity resulting from adherence to a lofty ideal of moral conduct in business relations,” says the 2020 National Association of Realtors® Code of Ethics. To Realtors®, the code of ethics is more important than transactions, sales, or profits.

Is It Worth Becoming a Realtor®?

Like most professional organizations, the National Association of Realtors® provides opportunities for professional growth, networking, and career advancement. Annual dues for the National Association of Realtors® are $150 in 2020. Each state and local association also has its own dues requirement for members. These costs can be expensive, but you should consider the value of a strong professional network in building your business and reputation.

Brokers who are Realtors® do need to pay a non-member fee if any of the agents on their team are not members of NAR. If a Realtor® broker hires a non-member real estate salesperson, they will still need to pay NAR dues. This makes Realtors® often want to work with and hire others with the Realtor® designation.

Within a firm, one of the principal members, such as a partner or corporate officer, must be an official Designated Realtor® before any of the other brokers or agents can join. All principal members who are eligible must join the National Association of Realtors® for anyone in the firm or company to be affiliated with the NAR.

After the Designated Realtor® joins, other licensed real estate brokers, salespeople, and appraisers at the company can also join the NAR. If anyone chooses not to join, the Designated Realtor® will need to pay the non-member fee for that individual.


Talk to your broker or firm about paying for your National Association of Realtors® dues. They may be willing to cover this cost for the increased professional development opportunities.

Realtors® can save money on everything from insurance to marketing tools through their membership in NAR. If you plan to use these types of services, you can easily make up your annual dues in savings. Your company may also be more interested in hiring you if you are a Realtor®, especially if they are members as well.

A Career as a Real Estate Agent, Broker, or Realtor®

Once you are ready to start down the path to becoming a real estate professional, it’s time to set goals for your career. Whether you are starting to complete your pre-licensing education, studying for your licensing exam, or working on your first real estate sale, understanding the roles and responsibilities of a real estate agent, broker, and Realtor® will help you succeed.

You may just find that you are ready to continue your career in a position of increased responsibility as a broker or professional networking as a Realtor®. All of these positions are essential in the real estate industry and make rewarding careers. Whether you become a trusted home buying and selling real estate agent, join the National Association of Realtors®, or take on the leadership of a real estate broker, your know-how and experience will grow as your career progresses.

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