When you enter the realm of buying or selling a home, you’ll likely encounter several real estate professionals who can assist you throughout the process. These experts include real estate agents, real estate brokers, and Realtors. While they all play vital roles in the world of real estate transactions, each has its distinct qualifications, responsibilities, and contributions.
Real Estate Agents
Real estate agents are the front-line professionals who guide individuals through the intricate process of buying, selling, or renting real estate properties. They serve as the intermediaries, bridging the gap between buyers and sellers, and their compensation is primarily commission-based. Agents may represent either the buyer or the seller, depending on their clients’ needs.
Becoming a licensed Myrtle Beach real estate agent entails meeting specific state requirements, which can vary from place to place. In general, aspiring agents must be
- at least 18 years old,
- legal residents of the U.S.
- complete mandatory pre-licensing courses
- pass the state real estate license examination
- undergo background checks
- secure sponsorship from a licensed real estate broker.
To maintain their license, agents must also engage in ongoing continuing education.
Real estate agents perform a wide range of tasks, including
- organizing transactions
- conveying offers and counteroffers between parties
- addressing client inquiries
- guiding clients through the paperwork maze
- ensuring that clients fully comprehend the various aspects of the sale
Agents who work with sellers, known as listing agents
- help determine appropriate listing prices
- suggest property enhancements to boost its value
- offer staging advice
- market the property through channels like the Multiple Listing Service (MLS).
Conversely, agents representing buyers, referred to as buyer’s agents
- search for properties that align with their clients’ criteria and budget
- arrange appraisals and inspections
- negotiate terms.
Real estate agents are typically compensated on a commission basis, meaning they receive a percentage of the property’s sale price. This commission is divided among the buyer’s agent, the listing agent, and their respective real estate firms. The specific division varies but often falls within the range of 5% to 6% of the purchase price.
Real Estate Brokers
Real estate brokers share many responsibilities with agents but operate at a more advanced level. To become a broker, an individual must pursue additional education and successfully obtain a state real estate broker license. What distinguishes brokers is their ability to work independently, and they may also have the authority to employ other real estate agents.
Real estate brokers engage in activities similar to those of agents, such as
- assisting buyers and sellers
- conducting negotiations
- preparing offers
- addressing clients’ needs.
However, brokers possess the freedom to establish their own real estate brokerage firms and oversee multiple agents. There are various tiers of real estate brokers, each with different responsibilities:
Associate Brokers: These brokers have broker licenses but opt to work under another broker. They typically do not supervise other agents.
Managing Brokers: Managing brokers assume more significant responsibilities, overseeing daily operations, transactions, and often playing a role in hiring and training new agents.
Principal/Designated Brokers: At the highest tier, principal or designated brokers supervise real estate agents, ensuring their compliance with state and national real estate regulations. Each real estate office usually has one designated broker.
Brokers earn money through a combination of their own commissions and a portion of the commissions earned by agents working under them. Unlike real estate agents, brokers do not need to share their commission with a real estate agency.
Realtors are a distinctive group of real estate professionals who belong to the National Association of Realtors (NAR), the most extensive trade association in the U.S. While many people use the terms “Realtor” and “real estate agent” interchangeably, Realtor status is not limited to agents; it extends to various professionals within the real estate industry, including brokers, salespeople, property managers, and appraisers.
Becoming a Realtor involves specific requirements:
- Holding a valid and active real estate license.
- Actively participating in the real estate business.
- Maintaining a clean record with no sanctions for unprofessional conduct.
- Avoiding recent or pending bankruptcy filings.
Once these criteria are met, individuals can apply for Realtor membership by joining their local real estate association, paying a one-time application fee, and covering annual membership dues. Realtors must adhere strictly to the NAR’s Code of Ethics, which upholds high standards of professionalism and conduct.
Realtors use the Realtor trademark in their names to indicate their membership in the NAR. However, it is essential to understand that being a Realtor is not synonymous with one’s professional licensing status; it signifies a commitment to ethical conduct and industry standards.
Choosing Between a Real Estate Broker or Agent
The decision to work with a real estate broker or agent hinges on your unique circumstances. Independent brokers may offer access to a broader range of properties and could provide flexibility regarding fees since they do not need to share commissions with an agency.
Differentiating Between Buyer’s and Seller’s Agents
In a real estate transaction, a buyer’s agent assists homebuyers in their property search, guiding them through the selection process. Conversely, a seller’s agent, also known as a listing agent, aids homeowners in listing and selling their properties. Both agents typically share the commission paid by the seller, with their respective cuts potentially divided with their real estate firms.
Utilizing Real Estate Professionals for Rentals
Real estate agents and brokers also assist in listing rental properties and locating suitable tenants. Tenants often pay their broker a fee (usually one or two months’ rent), which is then shared with the listing agent in Myrtle Beach.
Selling a Home Independently (FSBO)
For those seeking to avoid substantial commissions, it is possible to sell a home independently through a “for sale by owner” (FSBO) approach. This method includes various levels of involvement, from simply placing a “for sale” sign in the yard to utilizing discount listing services to post the property online.
However, it’s important to note that FSBO listings typically lack professional staging and marketing, and sellers may still need to pay the buyer’s agent’s commission when the property is sold. The choice to go FSBO should be carefully considered based on individual preferences and circumstances.
In essence, understanding the roles and distinctions among real estate professionals empowers buyers and sellers to make informed decisions throughout their real estate journeys. Each of these experts plays a crucial part in facilitating real estate transactions, whether you’re a buyer looking for your dream home, a seller seeking to maximize your property’s value, or a landlord interested in renting out your space.
Knowing the differences among real estate agents in Myrtle Beach, brokers, and Realtors equips you with the knowledge to navigate the real estate landscape confidently and make well-informed choices that align with your specific needs and goals.
Cheryl Woodward is both a real estate agent and a broker. Hire the best – Full Potential Real Estate. Call us now.
Like our Facebook page for more information about buying or selling homes.