Did you know that there is a difference between a Realtor and a real estate agent? You might be using the terms interchangeably without a proper understanding if you’re new to the real estate scene. Understanding the distinctions between these two real estate professionals as well as a real estate broker can help you get the clarity you need in choosing whom to work with in your real estate endeavors.
A Realtor is a licensed professional who belongs to the National Association of Realtors (NAR). In fact, the word is often capitalized because it’s a registered trademark for a member of the NAR. Founded in 1908, the NAR is America’s largest trade association, representing 1.5 million+ members. It boasts an extensive code of ethics along with specific policies, procedures, and professional standards its members must adhere to. Having this membership can give consumers peace of mind in knowing they are working with a professional who has been thoroughly vetted and is currently committed to upholding certain standards.
Technically, not all Realtors are real estate agents. Other professionals in the real estate industry such as home appraisers, property managers, real estate counselors, and real estate brokers can also be considered Realtors if they are active members of the NAR.
Real Estate Agent
A real estate agent is a licensed professional who works in the real estate industry focusing on the transactions between buying and selling property, but is not a member of the NAR. A real estate agent not only helps clients buy and sell, but also rent. However they are not required to adhere to the high standards the NAR demands without membership. In order for a real estate agent to be considered a Realtor, they must become a member of the NAR.
Real Estate Broker
A real estate broker is an independent business person who often sells real estate property owned by another party. Brokers can either work on their own conducting real estate transactions independently, or have real estate agents working for them. Brokers are the ones who supervise real estate transactions and bear responsibility for the agents conducting those transactions. They can also work with property managers, charging them to manage or rent out their properties for a fee. Because of their weighty responsibility, becoming a broker requires additional education and exams for licensure.
Again, you can be a licensed real estate broker without joining NAR, but to be considered a Realtor, you have to be a member.
NAR’s Code Of Ethics
The Code of Ethics created by the NAR serves as the ethical guidelines that its members must uphold. Composed of 17 articles covering different areas of standards of practice for real estate professionals, the Code of Ethics is strictly enforced. Articles one through nine define a Realtor’s duty to their clients and customers. Articles 10 through 14 state a Realtor’s duty to the public. And Articles 15 through 17 define a Realtor’s duty to other Realtors.
Here are listed summaries of the 17 articles realtors pledge to abide by:
- Promote their clients’ interests before their own and treat all parties involved honestly.
- Avoid exaggerating, misrepresenting, or withholding facts about the property or transaction that are within the scope of their real estate license.
- Cooperate with other brokers when it is in their client’s best interest.
- Disclose with their client if they are working with another member of their existing client’s family.
- Avoid providing professional services regarding a property they have an interest in, unless it is disclosed to the client.
- Receive the client’s consent and knowledge before accepting any form of payment or commission.
- Disclose to all parties and receive consent from their client if a payment is to be received from more than one party involved in a transaction.
- Keep personal funds and clients’ funds separated.
- Ensure all agreements are clearly and understandably communicated between all parties involved in a transaction, and that each party receives a copy of each agreement.
- Refrain from discriminating against any person based on race, color, religion, sex, handicap, familial status, national origin, sexual orientation, or gender identity.
- Competently abide by standards of practice in their real estate discipline, and do not provide services they are unqualified for.
- Remain truthful in their advertising and marketing materials.
- Do not practice law if they are not authorized to do so.
- Present all evidence and cooperate if charged with unethical practice.
- Refrain from making false or misleading statements about other real estate professionals.
- Do not interfere in another realtor’s contractual relationships.
- Handle disputes with other realtors through arbitration instead of litigation.
Choosing the Right Person to Help You Buy or Sell Your Home
When deciding on a real estate professional to work with, there are a few things you should consider in addition to NAR membership:
- Experience: How well does this person understand the details of the property buying and selling processes? They should be able to walk you through each step thoroughly with provided materials.
- Location-specific knowledge: A good real estate agent has their hand on the pulse of the local market. They should be able to provide you with comparable properties, price points, school ratings, and crime ratings as well as determine fair price margins in the area.
- Negotiation skills: Can they boast about the deals they’ve landed for their past clients through negotiation? Real estate agents act as the middleman between the buyer and the seller which calls for clear communication and keen negotiation tactics.
At the end of the day, the decision is yours on who you want to work with. But it’s important to keep these things in mind to make sure you get a pleasant experience getting what you want in your real estate venture. I have over 10 years of real estate experience, and am a proud member of the NAR. Click here to learn more about how I can help you in your real estate journey!