You are finally entering the real estate business world, but you are not sure about some things yet. There are similar terms that you would like to clarify; for example – what is the difference between Realtors and real estate agents?
Before you take off with your own business or start working in some big real estate company, it would be best to be 100% familiar with the basics.
Don’t trouble yourself with those big books and stacks of paper that are energy-draining. Read our article and find out everything about the differences and similarities between Realtors and real estate agents, how much they earn, and whether this business is worth it?
Welcome To Real Estate
The world of the real estate business is bigger than you thought. There are different types of real estate and even different opinions on investing in it.
Real estate is concerned with all of the legal matters of land, buildings, or any other property type in ownership. We could say that there are four types of real estate:
- Residential real estate – This type of real estate deals with the construction and sale of homes. These homes are usually meant for single-families, and they include townhouses, vacation houses, etc.
- Commercial real estate – This type of real estate deals with a public property like shopping centers and malls. We could fit apartment buildings in here too because they also produce some income.
- Industrial real estate – This type of real estate deals with manufacturing – mainly warehouses and other types of buildings used to distribute goods.
- Land – This type of real estate isn’t about buildings, but managing and the subdivision of land and ranches.
Besides this division, we have the seller’s and buyer’s agents. The seller’s agents use listings that are used to put a price on your property. They also help you present your property in the best way possible. On the other hand, the buyer’s agents help the buyer find the perfect house. They guide you to areas which are according to your taste and negotiate in your name.
Now, a little something on real estate investing:
- Both selling and buying houses are a part of real estate investing. You can do a lot of things. For instance, you can flip houses – buy a house to impress, renovate it, and then sell it to make a profit. You can also buy stocks of homebuilders, and after a few years, you can get some good money for them.
- Another way is investing through Real Estate Investment Trusts (REIT). REIT is a group of companies that owns and operates with real estate properties, but the most important thing they do is invest in parking lots or office buildings.
Is Realtor The Same As Real Estate Agent?
The answer is NO. However, many people mistake these two terms and mix them, thinking that they mean the same. In order to prevent yourself from making this mistake, you should learn the differences and similarities between these two professions.
The main distinction between these two terms is that a real estate agent can be anything from a broker to a buyer’s agent. On the other hand, a Realtor must be subscribed to the Realtor Code Of Ethics, which has 17 articles. (But, we’ll get to that later)
A Real Estate Agent
- This is a person who has a real estate license, and his job is to assist in buying and selling a house. They can work in various fields, from residential to commercial, or even land. This depends on their certificate. With this mentioned, agents need to obtain a certain level of state education and pass the exam. When they finish this, they are advised to continue their education and renew the license every two years.
- A real estate agent needs to follow these steps to get their license: research the education requirements and start a course, apply and pass the exam, and after they are “listed,” try to find work to gain experience.
- Some quick tips on how to become a top real estate agent:
- Be proactive
- Deal with issues before they appear
- Have good allies
- Always self-improve
- This is a person who is a member of NAR – National Association of Realtors. This is the largest trading organization in the USA. The important thing about this is that every Realtor should be subscribed to The Code Of Ethics produced by this organization. In simple words, the 17 articles in this code represent a set of rules that every Realtor should obey..
- We are here to give you a list of those articles:
- Promote your client’s interests at all costs.
- No exaggerating and avoiding facts about the property.
- Do business with other brokers.
- Avoid providing professional services unless needed.
- Disclose with the client if they are working with another member of the family.
- Receive knowledge and consent from the client before doing anything.
- Disclose to all parties and receive consent if the payment is received from more than one party.
- Separate personal and client funds.
- All agreements should be communicated clearly.
- No discrimination by race, color, religion, etc.
- Follow the real estate discipline and standards.
- Remain truthful in advertising.
- Do not practice law if not authorized to do so.
- Present all evidence and cooperate.
- No false or misleading statements.
- Do not interfere in another Realtor’s business.
- Handle disputes through arbitration.
- Important Note: Always capitalize the word Realtor – because the NAR trademarked it.
The Benefits Of Having A Real Estate License
Having a real estate license can get you far in this field of business. After getting familiar with the job description of Realtors and real estate agents, let’s mention some benefits of being licensed.
- Extra income – You are bound to get some extra cash in one way or another. Even if you don’t want to make this a permanent thing, you can still earn some good money.
- Access to new deals – Having a license enables you to enter values that you couldn’t before.
- New contacts – During your deals, you will come across many new references and meet people who might be of great help in the future.
- Education – The more you know, the better. Always choose to learn more if you have the chance. There is nothing more useful than to be curious about your job.
- Commission – With personal commissions, you will be saving money, which will, after some time, come in handy.
Money In The Pocket
Of course, everyone is interested in how much money this business brings, and we are here to do the math for you. There are some differences in the paychecks when it comes to realtors and real estate agents, so pay attention:
A real estate agent can make anywhere from $24.000 to $103.000. This depends on the real estate agency he is working for. So, let’s say that an average real estate agent salary is close to $50.000. Not bad at all!
Some of the top companies for real estate agents are Keller Williams Realty, Inc ($52k), Re/Max Real Estate ($47k), and Redfin ($35k).
On the other hand, a Realtor can get paid anywhere from $23.000 to $149.000. The average salary of a Realtor is close to $60.000.
Some of the top companies that employ Realtors are almost the same, but the paychecks are different. Self Employed ($100k), Keller Williams Realty, Inc. ($70k) and Re/Max Real Estate ($41k).
The Difference Between Realtors and Real Estate Agents – Conclusion
To prevent yourself from making the mistakes and mixing the terms Realtor and real estate agent, you should learn the differences and similarities.
The real estate business is pretty big, and sometimes it can leave people confused – there is industrial, residential, commercial, and land real estate. There are also many agents working in these fields, like the seller’s and buyer’s agents.
By being in real estate, you are investing both time and money. You can decide to invest in a house by buying it and then selling it (flipping) or investing in REIT.
Now, a real estate agent is a person who has a real estate license, and his job is to assist in the procedure of buying and selling a house. A realtor is a person who is a member of NAR – National Association of Realtors. This organization produces the 17 articles, which are a set of rules that should be obeyed by every Realtor in the country.
You should get a real estate license, mainly because of extra income, commission, and new job deals and contacts.
Both Realtors and real estate agents earn a good amount of cash. They can make anywhere from $20.000 to $149.000, depending on the agency they work for.