Realtors, also known as real estate agents, are licensed real estate professionals who can help you buy or sell a home.
There are two types of realtors:
- Listing agents represent home sellers.
- Buyer’s agents represent home buyers.
Most agents work with sellers and buyers instead of working exclusively with one group. Occasionally, the same agent will represent both the buyer and seller — this is called dual agency.
The most important day-to-day responsibilities of a realtor include:
- Adding homes to the Multiple Listing Service or MLS (the online database where homes are displayed publicly for sale) so other agents and potential buyers can see them
- Marketing via open houses, social media, and local signage
- Showing houses to prospective buyers
- Submitting offers on behalf of buyers
- Negotiating with other realtors about offers and contract details
Real estate agents earn commission from the proceeds of each sale they assist with. Typical commission is 6% of the final sale price, which gets split between the buyer’s agent, the listing agent, and their brokers — the individuals who oversee transactions in a real estate firm.
|Real estate agent qualifications|
|📚 Minimum real estate education from state real estate association|
|✅ Passing grade on the state's licensing exam|
|👤 Sponsorship from a licensed real estate broker|
Realtor vs. real estate agent
We use the titles “realtor” and “real estate agent” interchangeably, but technically they refer to different things.
A real estate agent is a licensed professional who helps people buy and sell homes.
A REALTOR (uppercase) is a licensed professional who is also a member of the National Association of REALTORS (NAR).
Many real estate agents belong to the NAR because it can boost their credibility and provide networking opportunities, but agents aren’t required to join.
For the purposes of this article, all uses of the word realtor, unless fully capitalized, are intended to refer to all real estate agents.
What are the responsibilities of a realtor?
A realtor’s responsibilities depend on who they’re representing: buyers or sellers.
Agents who represent sellers are responsible for marketing homes and finalizing deals with the buyers and/or buyer’s agents.
Agents who represent buyers are responsible for helping to find and purchase homes.
What does a realtor do for a seller?
Listing agents use their marketing and negotiation skills to guide you through your home sale, from the moment you commit to working with them until your home officially sells.
Before your home is listed
First, a listing agent determines a competitive listing price for your home. They do this by conducting a comparative market analysis (CMA). A CMA uses recent sales data from comparable properties in your area to determine the market value of your home.
Next, the realtor works with you to prep the home for listing. Generally, this means they:
- Take pictures of the house to capture its best features
- Get information from you about any upgrades or repairs you’re aware of, or repairs that need to be made
- Give you advice about how to prepare your home for showings
While your home is listed
Once your agent activates your listing, it’ll be publicly available for buyers and agents to view on the MLS.
Your agent may also place a For Sale sign in your yard to make the property more noticeable to potential buyers from the street.
Listing agents also use other strategies to promote an active listing, such as:
- Hosting an open house
- Creating custom brochures to share with buyers
- Running targeted social media ads
When an offer comes in from a buyer, your listing agent will review it with you and help you decide if you want to accept, respond with a counter offer, or reject the offer.
Once you accept an offer
After you’ve accepted an offer, it’s your listing agent’s job to guide the sale toward closing.
In real estate attorney states, the agent doesn’t have to do as much since attorneys manage all of the details.
In other states, the agent will be responsible for reviewing paperwork and checking in with the buyer’s agent to make sure all contingencies of the sale are met before closing day — the day when the home officially changes hands.
What does a realtor do for a buyer?
Buyer's agents use their knowledge of house construction and local real estate experience to help you identify a suitable home. They can point out flaws when you tour a home, help you put together an offer, and negotiate with the seller on your behalf.
When you're looking for houses
An experienced buyer's agent helps you evaluate houses because they know what repair issues to watch out for, and they know prices in the local market well enough to judge whether or not you're looking at a good deal.
A buyer's agent will ask you questions while you're touring houses to make sure you're financially prepared to purchase a home. If you aren't, they'll probably instruct you to get pre-approved with a mortgage lender.
Your buyer's agent will also find out what matters to you the most (home size, location, amenities) to make sure they're showing you houses that match your criteria.
When you're ready to make an offer on a house, your realtor can prepare and submit it on your behalf. They may advise what to include in the offer, like a home inspection contingency in case you'd like to have the home inspected before finalizing the deal.
After your offer is accepted
After a seller accepts your offer, your realtor will communicate with the listing agent to make sure everything is moving forward as planned.
Your realtor will also make sure you're meeting all of your contingencies (getting final approval for a mortgage, getting a home inspection, etc.) on time.
Your agent can answer questions leading up to closing to help minimize the stress of making such a big purchase.
If any issues come up, the buyer's agent works things out with the other party and does whatever they can to make sure the deal doesn't fall through.
Should I use a realtor?
In most situations, you should use a realtor when you buy or sell your home. A real estate agent uses their expertise to help you to get maximum value whether you're buying or selling, and they'll protect you from making amateur mistakes.
Most homeowners only get the chance to buy or sell a house a couple of times, so they never become experts. The best realtors, on the other hand, do dozens of these transactions every year.
If you're a seller, you could try selling your home by yourself but these sales are much more difficult. In fact, for sale by owner (FSBO) sellers sell for 26% less than sellers who work with a realtor, on average.
You don't have to work with a real estate agent, but you'll be exposing yourself to a lot of unnecessary risks if you choose to represent yourself — which is why most people still use an agent.
According to the National Association of REALTORS, 88% of buyers and 89% of sellers chose to work with a real estate agent in 2020.
Percent of people who work with a real estate agent
3 reasons to work with a realtor
- They help you save money: Even though real estate agents charge commission, they can often make up for it by getting more money for your house if you're a seller, or negotiating a fair price if you're a buyer.
- They protect you from liability: Most real estate agents are required to carry errors and omissions insurance, so there's less chance that you'll be on the hook if there's a legal issue with your sale or purchase.
- They know the market: A realtor's true value is their local market knowledge. They're familiar with sale prices, neighborhood amenities, and common problems with properties.
How do realtors get paid?
Realtors are paid commission from the proceeds of a home sale.
Typically, listing agents charge 6% of the final sale price and split this commission with the buyer's agent.
The agents also have to split commission with their brokers, so they might only walk away with 1.5% of the final sale price.
For example, on the sale of a $300,000 home, 6% commission would equal $18,000.
|Buyer's agent (1.5%)||$4,500|
|Buyer's broker (1.5%)||$4,500|
|Seller's agent (1.5%)||$4,500|
|Seller's broker (1.5%)||$4,500|
|Total commission (6%)||$18,000|
FAQs about realtors
What is a realtor?
A realtor is a licensed professional who helps people buy and sell real estate.
Realtors must obtain basic real estate education from their state, pass a licensing exam, and be sponsored by a licensed real estate broker to legally represent clients.
A REALTOR (uppercase) is a member of the National Association of REALTORS, but realtor (lowercase) is commonly used to refer to all real estate agents.
Millions of realtors work in the United States, which can make finding the right realtor for your situation difficult. Check out our complete guide on how to find a realtor.
What do realtors do?
Realtors guide home buyers and sellers through the real estate transaction process.
For sellers, this means establishing a competitive price, listing the home on the open market, and marketing the home to maximize its exposure and attract strong offers from qualified buyers.
For buyers, this means assisting with finding and evaluating homes, and putting together offers. Realtors also help buyers negotiate when necessary and meet all of the conditions outlined in the home-purchase contract before closing.
Some realtors go above and beyond with services like staging and professional photography. Learn how to choose a realtor who can increase your odds of success whether you're buying or selling a home.
How much do realtors charge?
Realtors generally charge 6% of the final sale price, but this commission is split between the listing agent, the buyer's agent, and their brokers.
The listing agent pulls the commission from the process of the sale and pays themself, the other agent, and the brokers after the sale has been closed.
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