In everyday life, it’s common to come across the terms “Realtor” and “real estate agent.” Although these titles are often used interchangeably, there are differences. Gaining a clear understanding of these distinctions can be helpful for both professionals and clients alike in making informed decisions within the industry.
A real estate agent is a professional who has obtained a state license to assist consumers in buying and selling properties. In contrast, a REALTOR® is an agent who has gone further, becoming a National Association of Realtors (NAR) member. This membership brings additional requirements and benefits, including adherence to a strict code of ethics and access to various resources and designations. Let’s dive in and compare Realtor vs Real Estate Agent!
Key Takeaways
- Real estate agents help buy and sell properties, while REALTORS® are agents with NAR memberships.
- REALTORS® must adhere to a strict code of ethics and have access to valuable resources and designations.
- Understanding the differences between real estate agents and REALTORS® can help make informed decisions within the industry.
What Is A Real Estate Agent?
A real estate agent is a professional who has obtained a state license to help people buy, sell, or rent properties. They can work with residential or commercial properties, depending on their specialty. As an agent, you might also focus on a specific niche within the industry, such as a listing agent, buyer’s agent, or rental agent.
Listing agents generally work with sellers to list and market their homes, ensuring their properties are prominently displayed to potential buyers. On the other hand, buyer’s agents work with buyers to find and negotiate the best deal on their dream homes. If you’re in the market for a new home, working with a buyer’s agent can help you navigate the complex process of househunting and making offers.
As the name suggests, rental agents work with tenants to find suitable rental units that fit their budgets and preferences. If you’re looking for a new rental property, partnering with a rental agent can save you time and effort by streamlining the search process.
As a real estate agent, you have the opportunity to build a successful and fulfilling career by helping clients find the perfect property. You’ll be involved in various aspects of the transaction, from the initial search to the final details, and you’ll earn a commission for your hard work. So, if you’re ready to dive into real estate, consider becoming a licensed agent and making your mark on the industry.
Requirements for Agents
Becoming a successful real estate agent starts with fulfilling the necessary licensing requirements. To earn your license, you must complete the required pre-licensing education and pass a state exam. The coursework often covers various aspects of the industry, including national real estate laws, state laws, and local practices. Remember to check out the specific requirements for your state; they can differ substantially, making it important to understand what needs to be accomplished before diving in headfirst.
You must complete 40 to 180 hours of pre-licensing courses about local, state, and national real estate laws and practices. Once you’ve completed the coursework, you must take a licensing exam. Passing this test will officially grant you the title of a real estate agent. It’s crucial to prepare thoroughly for the exam, as it is designed to evaluate your understanding of the industry and its various regulations.
Upon obtaining your license, ongoing requirements will be for maintaining your status as a licensed real estate agent. Most states mandate that agents renew their licenses every one to two years, with some variation based on location. Part of this renewal process typically entails completing a certain amount of continuing education coursework to ensure you remain up-to-date on any changes to industry regulations and best practices.
What Is A REALTOR®?
Imagine a real estate agent, Mark, who decided to become a REALTOR®. What changed? Well, Mark went above and beyond. He didn’t just stop at earning his state license; he also became a part of a legendary network known as the National Association of REALTORS® (NAR), the largest trade association in the U.S., with roots tracing back to 1908. This step transformed Mark from being just another real estate agent into a proud Realtor, a title held by over 1.4 million members across various real estate fields.
You might think a Realtor is just another real estate agent, but there’s more to it. Realtors must adhere to a strict code of ethics and standards of practice that go beyond state laws. This means they are expected to operate with more professionalism and integrity. So, when you work with a Realtor, you can expect a higher service level than a regular real estate agent.
As a member of NAR, a Realtor also has the exclusive right to use the trademarked term REALTOR®. This is important because it distinguishes them from other real estate agents and showcases their commitment to ethical conduct and client service. So next time you’re looking for a real estate expert, remember that a Realtor has that extra layer of professionalism that sets them apart!
Requirements for REALTORS®
Becoming a REALTOR® is a step up from being a regular real estate agent. Let’s dive into what you need to do.
First, you must be a licensed real estate agent affiliated with a NAR (National Association of Realtors) member brokerage. This means that you’ve already completed the necessary training, coursework, and licensing exams to be a practicing real estate agent. You must know local, state, and national real estate laws and practices.
You’re ready to take the next step now that you’re a licensed agent. To become a Realtor, you must join a local real estate association that the NAR charters. What’s the point of this? It allows you to access resources, networking opportunities, and an official NAR designation. Remember the annual membership fee – this is part of being affiliated with the association.
But wait, there’s more! As a Realtor, you need to complete a one-time online course on the NAR Code of Ethics. This shows your commitment to professionalism and ensures that you understand the high standards of ethical behavior that you’re expected to uphold. And if you think you can coast after that initial course, think again! Realtors must take a refresher NAR Code of Ethics course every three years. This ensures you stay up-to-date with changes and maintain the highest ethical standards in your practice.
| Real Estate Agent | REALTOR® | |
|---|---|---|
| Licensing Requirements | State License | State License + NAR membership |
| Adherence to Ethics Code | Varies by state | Strict NAR Code of Ethics |
| Access to MLS | Depends on brokerage | Yes |
| Average Salary (2020 data) | $33,900 | $49,700 |
| Continuing Education | Depends on state requirements | Yes |
| Required Exams | State Licensing Exam | State Licensing Exam + Ethics |
What is the National Association of REALTORS®?
The National Association of REALTORS® (NAR) was founded in 1908 as the National Association of Real Estate Exchanges and changed to NAR in 1972. As a part of NAR’s mission, they strive to empower you and other members to be leaders in advancing and protecting the interests of property owners, consumers, and communities. Through their professional standards and trade association efforts, they focus on enhancing the real estate industry and fostering a positive environment for everyone involved.
NAR offers a range of benefits for its members designed to help you grow and succeed in your real estate career. These benefits include access to education, advocacy efforts, research, networking opportunities, and exclusive discounts on products and services.
By being a part of NAR, you’re joining a vast network of professionals who continually work together to improve the real estate industry and ensure a bright future for property owners and communities. So take advantage of those valuable resources and benefits, and make your mark in real estate.
The NAR Code of Ethics
The NAR Code of Ethics is a set of principles and standards that guide the professional conduct of Realtors. Adopted by the National Association of Realtors (NAR) in 1913, it has been revised and updated periodically to reflect the changing needs and expectations of the real estate profession and the public.
The Code of Ethics consists of 17 Articles outlining the ethical duties of Realtors to clients, customers, the public, and other Realtors. It is designed to ensure that Realtors provide their clients the highest level of service and work together professionally and ethically.
Some key Articles from the Code of Ethics include:
- Article 1: Protect and promote the interests of clients
- Article 2: Avoid misrepresentation or concealment of facts
- Article 3: Cooperate with other brokers
- Article 12: Present a true picture in advertising and representations
- Article 16: Respect the exclusive representation or exclusive brokerage relationship agreements that other Realtors have with their clients
As a Realtor, you must always adhere to these ethical guidelines. Failure to do so can result in disciplinary action, including fines, suspension, or even expulsion from the organization.
Part of your commitment to NAR and the Code of Ethics involves participating in ethics training. This training is designed to keep you up-to-date with the latest ethical standards and best practices in the industry, ensuring you maintain high professionalism in your real estate career.
REALTOR vs Real Estate Agent: FAQs
Should Real Estate Agents Become REALTORS®?
Deciding whether to become a Realtor is ultimately up to you and depends on your goals and preferences as a real estate agent. So, let’s explore some advantages and disadvantages of becoming a Realtor to help you with this decision.
Advantages of becoming a Realtor:
- Access to the Multiple Listing Service (MLS), a widely used database with properties for sale by buyers and sellers. This resource can give you an edge in your real estate transactions.
- Recognition and credibility, as a Realtor, is an indicator that you follow a high standard of ethics and conduct.
- Opportunities for continuous education, certifications, designations, and career development, helping you grow and advance in your profession.
- Representation and advocacy on legislative and regulatory issues affecting the real estate industry provide your business with an extra layer of support.
- Networking and referral opportunities within the National Association of Realtors connect you with other Realtors across the country and the world.
- Savings and discounts on various products and services tailored to support your real estate business.
Disadvantages of becoming a Realtor:
- Additional costs and fees associated with membership and education can be a burden, especially when starting your real estate career.
- Becoming a Realtor requires following the National Association of Realtors’ Code of Ethics and other rules and regulations, adding to your obligations and responsibilities.
- You might run into potential conflicts or disputes with other Realtors relating to ethical or contractual issues, which can bring challenges to your practice.
In conclusion, weigh the pros and cons of becoming a Realtor based on your preferences, goals, and long-term plans. Understanding how becoming a Realtor can complement your real estate career and whether the benefits outweigh the potential disadvantages is essential. With this information, you can make an informed decision that suits your needs.
What does it cost to become a Realtor? What do membership fees pay for?
So, you’re ready to take the leap and become a Realtor! First, let’s talk about costs. To become a Realtor, you must pay an annual membership fee to the National Association of REALTORS® (NAR) and your local association.
For 2023, the NAR membership fee is $150 per year. But what about your local association? This fee varies by location and typically ranges from $100 to $300 annually. Now that you know the costs, let’s discuss what these membership fees provide you.
Your investment in Realtor membership fees goes towards a variety of valuable benefits, including:
- Education: Gain access to a wide range of educational resources, including classes, webinars, and certification programs to help you stay up-to-date in the real estate industry.
- Advocacy: NAR and local associations lobby for your local, state, and national interests to ensure that policies and regulations are favorable to the real estate profession.
- Research: Receive exclusive access to market data, trends, and other valuable information to help you stay ahead of your competition.
- Networking: Build your professional network by attending association events, meetings, and other gatherings designed to connect you with fellow Realtors and industry professionals.
- Discounts: Take advantage of exclusive savings and special offers on various products and services, such as personal insurance, technology, marketing resources, shipping, car rentals, and more.
By investing in Realtor membership fees, you’re not just buying a title – you’re gaining access to resources, support, and a community that will help you succeed in your career.
What is the difference: Realtor vs Realator?
The difference between a Realtor and a Realator is that the first one is a correct spelling, and the second one is a common misspelling. A realtor is a real estate agent who is a member of the National Association of Realtors (NAR), which is a trade association that sets ethical standards and provides resources for its members. A real estate agent is someone who has a state license to assist consumers in buying or selling properties but does not necessarily belong to the NAR. Therefore, all realtors are real estate agents, but not all real estate agents are realtors.
Do REALTORS® earn more money than real estate agents?
Income in the real estate industry tends to vary greatly. Location, market conditions, experience, skills, and commission structure can all impact how much a Realtor or real estate agent earns. Some studies suggest that Realtors typically earn more than non-Realtors on average.
Why is this the case? Let’s take a look at some income data. According to the National Association of Realtors’ (NAR) 2020 Member Profile, the median gross income for Realtors in 2019 was $49,700, while non-members earned a median gross income of only $33,900. That’s quite a difference!
To further illustrate this point, we can examine salaries from ZipRecruiter’s data as of September 2021. The average annual salary for Realtors was $83,072, while real estate agents earned an average annual salary of $79,733. Although the difference between the two is not extreme, it demonstrates that Realtors tend to outearn their non-Realtor counterparts.
Why might this be the case? One possible reason is the professional standards Realtors adhere to as members of the NAR. These high standards translate to better service, contributing to higher earnings.
Of course, it’s important to remember that individual experiences may vary. Successful real estate agents earn more than some Realtors, and vice versa. Ultimately, both career paths can be lucrative, depending on personal dedication, skill, and market factors.
Do You Need a License and the NAR Designation?
First, you need a real estate license to practice in any state. Each state has its real estate commission or board responsible for issuing licenses. You’ll have to fulfill all the requirements in your state before being granted a license. Remember that a real estate license only applies in the state where it’s issued.
Now, let’s talk about the NAR designation. To use the term “Realtor” or display the Realtor logo, you must be a National Association of Realtors (NAR) member. This means you must follow NAR’s rules and regulations, which often involve a higher standard of ethics and professionalism than just being a licensed real estate agent.
So, you need a license to work as a real estate professional, but the NAR designation isn’t required. However, it can add credibility and prestige to your practice, leading to more clients and a more successful career.
How does a real estate broker’s role differ from a REALTOR®?
A real estate broker has pursued education beyond the agent level, as state laws require, and has passed a broker’s license exam. As a result, they have a deeper understanding of the ins and outs of the real estate industry. On the other hand, a Realtor is a licensed real estate agent, broker, or another real estate professional member of the National Association of Realtors (NAR). They are required to comply with NAR’s strict Code of Ethics. This means that while all Realtors must be either licensed agents or brokers, not all agents and brokers are Realtors.
Regarding daily activities, one of the main differences between a broker and a Realtor is that a broker has the authority to work independently and hire other real estate agents to work for them. Depending on their state’s regulations, a Realtor may or may not have that ability. So, you’re an agent looking for more autonomy. Consider working with a broker instead of just being a Realtor.
Another noteworthy point is that a real estate broker may possess additional certifications or specializations that a Realtor doesn’t have, such as being a mortgage broker, property manager, or appraiser. These extra qualifications can be useful when providing clients with comprehensive services.
