Everything you need to know about which types of real estate agents can help you buy property (even the more obscure types) and their differences. —-
Being careless with language is never a wise idea, but it can cost you money and time, not to mention cause a headache, during your house hunt. By not understanding the difference between the various types of agents and their specialties, you could waste time looking at houses that aren’t quite right, or spend more money than you should have because your agent lacked the specialist knowledge needed for your search. Worst of all, you could end up paying too much for a house that has issues you weren’t aware of!
Buying a house is a big decision, and you want to make sure the person guiding you through the process is the right person for your needs. This is why we’ve spoken with agents, investors, and buyers just like you and put together this article to explain the terminology and what these different types of real estate agents do.
Knowing exactly what type of agent you need for your house hunt will make the whole process so much easier — and maybe even faster! So let’s dig in.
Realtors® vs. agents vs. brokers
Some people think of Realtors®, agents, and brokers as roughly the same thing, but when you’re looking to buy a house, finding the right type of person to help you is going to be critical. (Spoiler: They aren’t all describing the same thing.)
For example, are you aware that Realtors® can have special designations that indicate they have been certified in a specific type of transaction? These certifications are varied ranging from green housing to international transactions and can be very, very relevant if you happen to be buying a house in that category.
Brokers and agents do not have official certifications, but they often have designations that determine how they work.
Some real estate brokerages will work with many types of agents who have various specialties.
Zach Walkerleib, a top Las Vegas real estate agent who specializes in working with first-time homebuyers, luxury homes, and investment properties, runs an operation that has several brokers with different specialties. He explains:
“We have a commercial agent. We also have a luxury real estate specialist. Both my partner and I are luxury certified, and we have a certified residential specialist, as well.”
Type 1: Real estate agents
A real estate agent has passed their state real estate exam and is licensed to sell real estate.
Real estate agents are supervised by a managing broker and can specialize in working with buyers or sellers, or both. However, agents who work with both rarely represent both the buyer and the seller on the same transaction, as that is called dual agency and is illegal in some states.
Real estate agents are sometimes called subagents, real estate salespeople, or sales agents. According to the Bureau of Labor Statistics, there were 168,740 real estate agents employed in the United States in May 2020. In New York, sales agents are known as brokers. It gets confusing!
Type 2: Realtors®
In order to be a Realtor®, an agent must be a member of the National Association of Realtors® (NAR), which has additional guidelines and requirements above those of state agencies, including a code of ethics that all members must follow. These requirements are often stricter than those of state agencies, making it more work to be a Realtor® versus just an agent or broker.
Many real estate agents and brokers are also Realtors®. You’ll know if they are because they’ll display their Realtor® credentials on their agent/broker profiles and their business cards.
Realtors® often have access to real estate inventory that other agents don’t have. As part of being a Realtor®, in some areas, this gives them access to the multiple listing service (MLS), which gives them access to more home listings. If you work with a Realtor®, you can benefit from that additional access.
Type 3: Real estate broker
Also licensed state-by-state, brokers have at least two to five years of sales experience as a real estate agent under their belts and must pass the real estate broker exam for their state.
Real estate brokers can (but don’t always) supervise other agents; sometimes they just want to work without supervision! Some brokers choose to join other broker’s firms, in which case they are usually referred to as an associate broker.
As noted above, in some states, a real estate agent is referred to as a broker (New York is probably best-known for this practice).
Now that we’ve covered the three main types of real estate agents, let’s explore some of those special designations and subtypes so we can learn more about how to find the best one for you.
Subtype 1: Listing agent
Listing agents specialize in listing homes, so they represent the seller in the transaction. If you’re looking to sell your home, you will want to contact a listing agent.
A listing agent will help home sellers with a variety of tasks, including setting the listing price, staging the home, marketing the home, advising repairs, and negotiating on their behalf.
Subtype 2: Buyer’s agent
Buyer’s agents represent the buyer and specialize in helping those buyers find homes and write and negotiate offers. They also help buyers through the post-purchase processes of home inspections and necessary repairs, often providing a list of home inspectors and repair-people they can recommend.
Walkerleib is known for exactly this sort of buyer support and service. He believes buyer’s agents at his brokerage “really show their value in ways that are above and beyond navigating the real estate transaction — they need to go into a vendor list and have concierge programs where we can help you with movers. We can help you with handyman. We can help you with all these different things in addition to just the transaction. We’re going to be there for you as your advisor after the transaction.”
Buyer’s agents are usually an accredited buyer’s representative and have passed the NAR Accredited Buyer’s Representative (ABR®) Designation Course.
Ryan Whitcher of Harmony Home Buyers in North Carolina purchases many homes, and when working with a buyer’s agent, he has a process he follows. He explains,
“I always want to make sure that anyone I choose to represent me is a credible person who is knowledgeable in their field. Choose an agent who has sold homes in the location in which you are buying, with experience selling homes similar in size and price. You may not want to use an agent who is used to selling three-bedroom houses at $200,000 if you are looking at purchasing a six-bedroom house for $1,000,00”
Subtype 3: Associate broker
Associate brokers are licensed brokers who actively work with buyer and seller clients, and who choose to work under another broker.
Associate brokers may want to work under another broker for a variety of reasons, including business or compliance support, or simply to gain experience. Some brokers choose to be associate brokers to avoid management responsibilities, including hiring and training other brokers and office staff, and to focus on their clients.
Subtype 4: Managing broker
Managing brokers are licensed brokers who manage agents and possibly associate brokers. They are responsible for the day-to-day operations of a brokerage, including staff, training material development, support and compliance, developing marketing materials, and more.
Depending on the brokerage, managing brokers may or may not help buyers or sellers directly.
Subtype 5: Dual agent
This is an agent who represents both a buyer and seller in the same transaction. Dual agency is currently illegal in nine U.S. states: Alaska, Colorado, Florida, Kansas, Maryland, Oklahoma, Texas, Vermont, and Wyoming.
To mitigate conflict-of-interest concerns, the other states have their own laws governing the disclosure of dual agency and the behavior of dual agents.
If two agents at the same brokerage are representing a buyer and a seller in the same transaction, that’s known as designated agency. It’s still a gray area in some states but is generally better-received than dual agency.
Subtype 6: Accredited agents
Are you interested in buying land? What about a house overseas? Perhaps a foreclosure or short sale? NAR offers over a dozen specialty certifications to help you identify an agent who has the right knowledge base and skill set to assist you with your specific purchase.
A NAR Certified International Property Specialist is going to be able to better advise you on buying a retirement house in Portugal than the average buyer’s agent.
Similarly, an agent with NAR’s Green Designation will help you find the energy-efficient home of your dreams.
If you want a technologically advanced home, you should consider working with a NAR Smart Home certified agent.
These are special certifications that are usually only available to Realtors® and that indicate an agent has a certain skill set. Agents will often advertise these certifications, but if you aren’t sure, ask!
Picking an agent
If you have a unique situation or are looking for expertise in a specific area (such as a type of purchase or physical neighborhood), be sure to keep that in mind as you’re checking reviews and talking to potential agents.
Chaia Milstein, a recent home buyer and longtime writer/editor, did not, and she ended up having to switch agents after spending nearly a year on a deal that didn’t work out. She advises,
“It turned out to be extremely important to find someone who knows the area — not just in terms of how to get from one place to another, but in terms of the cultural mores of the real estate industry. Or at least someone who was willing to learn fast enough to get you the deal you want.”
Instead of spending a long, hard, frustrating year in process for a deal that wasn’t right, having the right agent would have gotten her into her dream home sooner.
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