Difference Between a Real Estate Agent and a Broker: What you need to know

photo of a real estate broker and agent discussing a property
It is estimated that there are approximately 326,000 property management companies in the US, generating billions in annual revenue. Alone, the industry of property management Massachusetts is worth $422,191,390,000. Such massive market magnitude requires a fair number of dealings between buyers and sellers every day. However, the common man is often confused regarding the real estate terms and functionalities, requiring the help of expert professionals. Among these real estate experts, two are very prominent and are the imperative aspect of any property dealing, called real estate agents and brokers. Although these terms are often used interchangeably, there are important differences between the two. Understanding the roles and responsibilities of agents and brokers can help buyers and sellers make accurate decisions regarding buying or selling a property. In this read, we will explore the differences between real estate agents and brokers and what you need to know.

What is a Real Estate Agent?

Regarding real estate agents vs brokers, the main difference is in their roles. A real estate agent is a licensed personnel who manages real estate transactions, makes collaborations between buyers and sellers, and serves as their representative in negotiations. Real estate agents usually work on commission and pay a percentage of the property’s sale price. They can work for either the buyer or the seller in a transaction. Moreover, in various states, a real estate agent is authorized to work through a real estate broker, firm, or fellow professional with more experience and a specialized license. Real estate agents have extensive information about the local industry and can offer valuable guidance and advice to their clients throughout the process.

What is a Real Estate Broker?

In the property industry, a real estate broker is a certified professional who has completed additional education and experience requirements beyond those required for a real estate agent. Brokers have a choice; either they can operate independently or employ agents to work under them. In regards to the query, what does a real estate broker do; they are responsible for managing their brokerage. This includes hiring and supervising agents, handling accounting and payroll, and ensuring that all transactions comply with state and federal laws. In addition, brokers have a broader scope of work than agents and are responsible for ensuring that clients are satisfied with their services and addressing any issues that arise during the buying or selling process.

Broker vs Agent – What Differentiates Them?

Education and Licensing

Real estate agents and brokers have different education and licensing requirements. In most states, real estate agents must complete pre-licensing education courses and pass a state licensing exam to become licensed. The courses typically cover real estate principles, contracts, and property management. After obtaining their license, agents must work under the supervision of a licensed broker. Brokers, on the other hand, are required to have more education and experience than agents. They must complete additional coursework and pass a broker’s exam before becoming licensed. The coursework typically covers real estate law, ethics, and finance. This enhanced knowledge allows them the choice to work autonomously.

Scope of Work

Real estate agents work as a subordinate for a broker. They are responsible for finding clients, showing properties, negotiating deals, and providing support throughout the buying or selling. They are also responsible for marketing properties and handling paperwork, such as contracts and agreements. Brokers have a broader scope of work than agents. In addition to the responsibilities of an agent, brokers can manage their brokerage and hire agents to work under them. They are also responsible for ensuring all transactions comply with state and federal laws. Further, when it comes to asset management vs property management roles, brokers are more involved in asset management as these are high-profile decisions and require insights of the practiced individuals to make.

Responsibilities and Duties

There is not much difference in the broker vs agent responsibilities. Both these experts share similar responsibilities and duties. They both help clients buy, sell, or rent properties. They also provide guidance and advice to clients on pricing, marketing, and negotiating. However, brokers have additional responsibilities that agents don’t have. Brokers are responsible for managing their own brokerage, which includes hiring and supervising agents, handling accounting and payroll, and ensuring that all transactions comply with state and federal laws. They are also responsible for maintaining relationships with clients, ensuring that clients are satisfied with their services, and addressing any issues that arise during the buying or selling process.

Income and Earnings

Real estate agents and brokers earn money through commissions. These commissions are typically a percentage of the sale price of the property. Real estate agents usually earn a lower commission rate than brokers. However, since brokers have a wider scope of work, they can earn more money by closing more transactions and managing their own brokerage.

Brokers vs Realtors

People often get confused between the terms realtor and broker. Even though they are usually used interchangeably, they represent distinct roles within the real estate industry. A Realtor is a real estate expert who is an associate of the National Association of Realtors (NAR), a trade association that sets high professional and ethical standards. In the brokers vs realtors debate, it is important to understand that while all Realtors are either agents or brokers, not every agent or broker is a Realtor. In essence, a Realtor is a voluntary member of an association that upholds specific ethical standards within the real estate profession.

Associate Broker vs Broker

There is another term when it comes to the real estate landscape that may confuse you, which is associate broker. Although both personnel have the same level of education and experience, the difference comes in autonomy. An associate broker does not work independently; rather they choose to work as a subordinate under an independent broker. The reasons can range from acquiring more experience to not having a stable network of connections to lead smoothly. Either you hire a broker or an associate; both can help you effectively in real estate dealings. What makes a broker a more attractive option in the associate broker vs broker competition is their ability to make decisions independently and direct access, especially when you require personalized attention.

Blog Conclusion

While real estate agents and brokers both play an essential role in real estate transactions, they have different responsibilities, licensing requirements, and earning potentials. Understanding the real estate agent vs broker difference can aid buyers and sellers in navigating the real estate market seamlessly and profitably. It helps clients choose the right professional based on their specific needs, whether it’s a seasoned broker for a complex transaction or a dedicated agent for a more straightforward residential sale. This knowledge enables individuals to make well-thought-out decisions and ensures a smoother and more successful real estate experience. Real estate dealing is not something to be taken for granted; it is an investment that entails dreams and joys. So choose your real estate professional wisely and manifest your land-owning dreams into a beautiful reality. Happy Home Hunting!


Can a real estate agent become a broker?

Yes, after gaining experience and meeting additional education requirements, agents can pursue broker licensing.

Do brokers exclusively work independently?

Brokers can work independently, but they may also supervise agents and earn a portion of their commissions.

What are the qualifications for agent versus broker roles?

Agents need pre-licensing education, while brokers require more education and experience, often as licensed agents.

How do their compensation structures vary?

Agents earn commissions shared with the broker, while brokers earn from agent commissions and personal transactions, overseeing and training agents.