Working with the right agent is key to finalizing a property deal
There are four primary types of real estate agents.
It’s important to work with a real estate agent who can represent your interests as a home buyer or seller.
Real estate brokers are typically the managers of a real estate firm, overseeing a team of agents.
Buying and selling real estate can be a complicated process, even when every step goes smoothly. That’s why it’s important for buyers and sellers to work with real estate agents, for whom listing properties, reviewing offers, and explaining the fine print of purchase contracts is their everyday business.
If you’re looking to buy or sell a property—or both—it helps to understand what a real estate agent does and the type of agent you need to represent your side of the sales transaction. Let’s take a look at the four types of real estate agents.
A real estate agent has completed coursework and passed a state exam to obtain their real estate license, which allows them to represent the interests of a home buyer or seller. With a real estate license in hand, an agent can work selling residential or commercial real estate under a real estate broker at a real estate agency.
The word “realtor” is sometimes used interchangeably with real estate agent, but a Realtor® is a trademarked term reserved for members of the National Association of REALTORS® (NAR), one of the largest trade organizations in the country. Many real estate agents specialize in either commercial or residential real estate, and have different duties depending on whether they represent the buyer or seller of the home sale.
Now that we understand the purpose of a real estate agent’s work, let’s break down the primary types of real estate agents you could hire.
Real estate brokers start as real estate agents but continue in their education to earn an advanced license. When an agent decides to become a broker, it is usually with the intention of owning and managing their own real estate agency or firm, with a team of real estate agents under their management. A broker who works at a firm owned by another broker would be an associate broker.
Brokers can do everything an agent can do, with additional responsibilities such as moving money in and out of an escrow account and mediating legal conflicts.
Just as there are buyers and sellers in every real estate transaction, buyer’s agents and seller’s agents represent the appropriate side of the deal. The buyer’s agent helps the potential home buyer find the right property for their needs, submit an offer, negotiate the price, and close on the transaction. Buyer’s agents also analyze sale properties and comparable properties in the area to provide their clients with insight on how to propose a competitive offer.
Particularly for first-time homebuyers, buyer’s agents serve as knowledgeable experts during the property-buying process, including the home inspection and title search, among other aspects of a somewhat complicated transaction. They may also advise buyers about financing and relocation—some agents even bill themselves as relocation experts. Most importantly, the buyer’s agent serves as the liaison between the buyer and the seller (or seller’s agent).
The seller’s agent represents the seller of the property and takes on the responsibility of listing the home sale and communicating with potential buyer’s and their agents. This type of agent, sometimes known as the listing agent, is responsible for marketing the property, hosting open houses or individual buyer appointments, and analyzing comps to advise the seller on an asking price.
The seller’s agent will also receive and review offers from potential buyers and help the sellers choose the best offer. This agent will also negotiate on behalf of the seller at any point during the transaction. Remember that a seller’s agent is not the same as a selling agent—this is another term, albeit a confusing one, for a buyer’s agent.
While this scenario is not legal in all states, a real estate agent can represent both the buyer and the seller of a property sale. This type of agent is referred to as a dual agent. Dual agency is tricky because it can be difficult for the dual agent to uphold their moral and financial responsibilities to all parties, creating a higher likelihood of a conflict of interest.
Another form of dual agency involves two agents from the same real estate firm, with one person representing the buyer and the other the seller. Before working with a dual agent, consider some of the drawbacks, such as misaligned interest between the agent and the home buyer and seller.
