Buzz
When it’s time to buy or sell a home, you head online to find an expert to help guide you through the real estate process. Some professionals call themselves real estate agents, while others use the title Realtor. (And yes, the ‘R’ is capitalized—more on that soon.) Both can list properties and assist buyers in the purchasing process.
Sadly, online home listings and catalogs often fail to explain the differences between these roles, or why one might be preferable over the other. If you’re shopping for a new home, here’s a simple way to grasp the distinction between these two key types of real estate professionals.
A real estate agent is someone who has obtained a state-issued license allowing them to handle the buying, selling, or renting of properties. This license is granted after completing a training program, which varies by state in both content and length. For example, California requires 135 hours of coursework, while Virginia mandates only 60 hours. After passing an exam on both federal and state real estate laws, individuals can officially work as licensed agents. As of 2018, there were approximately 2 million real estate agents in the U.S., assisting with transactions involving 5.34 million homes.
A Realtor is a type of real estate agent with additional distinctions. The term, which is trademarked, is owned by the National Association of Realtors (NAR), a professional body established in 1908. This designation indicates that an agent is a member of NAR, has undergone ethics training, and has agreed to adhere to the organization’s strict code of ethics. In short, the code requires Realtors to prioritize their clients’ needs above their own and refrain from exaggerating property details, among other commitments.
“Every Realtor follows a rigorous ethical code rooted in professionalism, consumer protection, and the golden rule,” says Mantill Williams, vice president of public relations and communication strategy for NAR, in an interview with Mytour. “Adopted in 1913, NAR’s Code of Ethics was one of the earliest ethical frameworks established by any professional group. By joining, members agree to uphold and are held accountable to this code, which includes obligations to clients, the public, and fellow Realtors.”
“For instance, when representing a buyer, seller, landlord, tenant, or any other client, Realtors pledge to safeguard and advance their client’s best interests. While this responsibility to the client is paramount, Realtors must also treat all parties honestly.”
As of July 2019, there were about 1.4 million Realtors in the U.S., each paying an annual $150 membership fee to NAR. While most Realtors are also real estate agents, some are brokers, having passed the broker’s license exam after completing additional training on legal issues, taxes, and insurance. To qualify for the broker’s exam, candidates typically need to have worked as a real estate agent for at least three years. It’s important to note that being a broker doesn’t necessarily mean one is a Realtor.
So, what does this mean for you, the consumer? While real estate agents who become Realtors commit to following a Code of Ethics, is it truly enforceable? If NAR receives complaints about a Realtor misrepresenting property listings, the agent could be expelled from the association. In contrast, an agent might only lose their license if a criminal offense occurs. Of course, any agent can operate ethically, but a Realtor is typically held to a higher standard and offers more pathways for consumers to file complaints in the event of improper conduct during a sale.
Does this mean that every Realtor is automatically better than an agent? Not necessarily. Some agents may have more experience than a Realtor or may specialize in a specific area that aligns with your needs, such as commercial real estate. When selecting a real estate professional, it’s wise to seek recommendations from friends and colleagues. You can also look for Realtors who focus on particular groups of consumers, like military personnel.
While Realtors generally have high customer satisfaction—90 percent of homebuyers would recommend their Realtor, according to NAR—it’s still important to take your time and make a well-considered decision. After all, purchasing a home is likely the largest financial commitment most people will ever make.
