Choosing the right real estate professional is a key component in your home buying or selling experience. However, one thing you may not be aware of is that the term “real estate agent” and the term “Realtor” (which is trademarked) do not mean the same thing. Many buyers and sellers overlook this distinction, and thus may not receive the level of service they deserve.
To give you a quick reference point: Realtors are held to a higher standard of conduct based on a code of ethics, and are required to operate in accordance with the “Golden Rule.”
As such, they will always treat their clients, and, in return, expect to be treated in an honest and transparent manner with priority given to their best interest.
In addition to maintaining the proper licensing requirements, it’s not free to become a member of the National Association of Realtors (NAR). As such, if an individual is a member of NAR, they most likely remain active in the real estate industry in order to justify the expense.
What Is a Real Estate Agent?
A real estate agent is an individual who has taken and passed the required classes and the state licensing exam. The agent then pays a fee each year to keep the license active.
Real estate agents are legally licensed to represent both buyers and sellers in a real estate transaction.
Some locations have continuing education requirements every year or two, while other locations may have considerably different continuing education requirements.
Once agents have been working full-time for at least three years as an agent, they will be able to transition to becoming a broker in real estate—a position of greater responsibility than an agent.
What makes them distinctive?
Everyone who is an agent must obtain a license, but there are some agents who do not have the title of realtor.
Realtors gain their title by becoming members of the National Association of Realtors (NAR), an association that was established in 1908, first granting the title “Realtor” to its members in 1916, then filing for trademark protection in 1950.
In the U.S. in 2019, there were an estimated 1.4 million members using the title “Realtor”.
When someone chooses to be a realtor, he or she agrees to:
- Follow the NAR Code of Ethics
- Follow an established set of professional practices
- Place his/her clients’ needs above his/her own
Thus, although the distinction appears slight, it is very significant in the field of real estate when it pertains to the public perception of professionalism over time.
Purchasing a house is a major investment, and not something you will do weekly. You will want an agent who has experience with negotiations, contracts, and current market trends to help guide you through such a large financial decision on a regular basis. An agent that only completes one or two transactions each year may not be the ideal choice for providing sound advice during your purchase or sale.
You can consider how a realtor compares to a real estate agent like you might consider the difference between a fiduciary and a typical finance manager. A fiduciary is held to higher professional standards than finance managers that are not members of the National Association of Realtors (NAR). A realtor is required to always act in your best interests.
When you purchase or sell your property, you will be faced with multiple choices—what price to list your property for, what offers to accept, and what type of inspections are necessary, etc. If you find out what your agent means by “realtor” you will have an easier time making a good choice.
The distinction will allow you to decide if you prefer a person who has simply obtained a real estate license or a real estate professional who adheres to a written code of ethics and is affiliated with a national organization.
Both a real estate agent and a realtor can assist in the buying and selling of real property; however, although the distinctions may seem insignificant, they are very important in terms of the level of professionalism, training, and dedication.
When you begin the process of purchasing your first home or are preparing to list your property for sale, knowing exactly who you will be working with gives you a competitive edge.
