Real Estate Broker vs. Agent: Job Roles, Differences, and Salaries

Key Takeaways

Many people use the terms "real estate broker" and "real estate agent" interchangeably, but the truth is that these two job titles aren't the same. While both are real estate professionals who can help you buy and sell property, real estate brokers have more education and experience, which allows them to take on more responsibilities. Here are some important things to know:

• Many agents become real estate brokers if they want to advance their careers.

• To become a broker, you must first work as a real estate agent to gain experience and then pass an exam to become a broker.

• The steps to becoming a real estate agent vary by state. Before you seek your license, check with your state's regulation board to determine the current rules. 

If you're ready to start your career in real estate, consider the Successful Negotiation: Essential Strategies and Skills course offered by the University of Michigan on Coursera. You'll learn to understand the negotiation strategies and skills necessary for success and use a negotiation analysis to prepare for negotiations. In this real estate broker vs. agent guide, you can explore what each type of professional's job is like, how much they earn, and what it takes to become one.  

Real estate broker vs. agent compared.

Real estate agents and brokers are professionals who can help you buy and sell properties, but a few key differences exist. You can become a real estate agent by earning a license in your state. To become a broker, you must first work as a real estate agent to gain experience and then pass an exam to become a broker. Agents typically work for brokers, while brokers can work independently or hire agents to work for them. 

What is a real estate agent?

A real estate agent is a licensed professional who assists clients in buying and selling properties. In this role, you may assist sellers in listing properties on the market, determining a fair price, and advertising the property to potential buyers. You may also assist buyers in searching for the right property, accompany them to view properties, and help them make an offer. Once your clients are ready to make a transaction, you'll help them navigate the potentially complicated negotiations and paperwork that come with the process. 

What is a real estate broker?

A real estate broker is a licensed real estate professional who began as an agent and then gained experience, additional education, and licensing, enabling them to assume more responsibilities. Brokers may work independently, start their own brokerage, and hire other real estate agents. 

When you start as a real estate agent, you must have a real estate broker who will sponsor you to get your license. While both types of real estate professionals generally earn a commission, a real estate broker may also earn a commission from each of their sponsored real estate agent’s sales. In some real estate offices, the agent may handle the sales part of a property, while the broker handles the more technical aspects, like preparing the paperwork for a contract. 

How to become a real estate agent

The steps to becoming a real estate agent vary by state. Before you seek your license, check with your state's regulation board to determine the current rules. 

In most states, you must be at least 18 years old and have a high school diploma or GED. Other requirements often include passing a background check, undergoing fingerprinting, being a resident of the state, or being a U.S. citizen. Some states also require proof of good moral character and integrity, while others may have specific stipulations about any criminal activity in your past. 

Once you determine that you meet your state's requirements, you must take pre-licensing courses. Some states offer these online and in person, and the number of hours your state's course requires can vary. After you finish the exams, you must pass the state's real estate licensing exam. Many states also require a broker to sponsor you before they will give you your license.  

A college degree is usually optional to become a real estate agent, but it can be helpful. Some schools may offer degrees in real estate, but related majors, such as finance, marketing, and business, can also help build your knowledge for your real estate career. 

Skills and qualifications

A license will get you started as a real estate agent, but you'll also need to develop various skills to succeed. For example, you'll spend much of your day working with clients and other real estate professionals, so it's essential that you are a people person who enjoys spending time with others. It also means that communication skills are vital. From being an excellent active listener who can pick up on social cues to having good written and oral skills, you want your clients to see you as professional, competent, and trustworthy.   

Some other human and technical skills real estate agents need are:

• Problem-solving 

• Time management 

• Industry knowledge (including knowledge of your local real estate market and laws)

• Negotiation 

• Knowledge of your community (schools, taxes, public transportation, jobs, entertainment, etc.) 

• Tactfulness and honesty

• Strong ethics 

• Integrity 

• Traditional and digital marketing 

• Knowledge of technological trends in your field

• Networking 

Real estate agent salary

According to Lightcast™, the average annual earnings for a real estate agent is $99,178.25 [1]. Remember that real estate agents are usually paid on commission, which means you earn a percentage of every transaction you make. If you make more sales, your earning potential can be higher.  

How to become a real estate broker

Before becoming a real estate broker, you must work as a real estate agent for some time. Every state has unique requirements, but the average is between two and five years. 

Once you've met your state's requirements, you'll go through a process similar to the one you went through to become a real estate agent. First, you'll take pre-licensing courses. These usually cover more advanced topics, like laws, taxes, and insurance. Once you complete your state's courses, you must pass an exam to receive your license.  

Again, check with your state's regulation board to ensure you have up-to-date information.  

Real estate brokers fall into three categories: associate, managing, and principal or designated brokers. Associate brokers usually work for a brokerage but don't manage other agents. They share the workload. Some people compare managing brokers to human resources employees. They help hire and train new agents and oversee day-to-day operations in a real estate firm. A principal or designated broker runs a brokerage and its agents. Every real estate office has one on staff. 

Skills and qualifications

Real estate brokers need all the same skills that real estate agents need. For example, negotiation is an integral part of any real estate career, but as a broker, you will play an active role in all negotiations. Your negotiation skills must be strong to get the best deals for your clients. Working as a real estate agent for a few years before becoming a broker can help you hone your skills, as can continuing your education through earning certifications and taking courses. 

Other skills real estate brokers need include: 

• Business development 

• Strong knowledge of real estate laws and regulations 

• Strong understanding of your local real estate market

• Problem-solving 

• Sales and marketing 

• Critical thinking

• Management and leadership 

• Communication and persuasion 

Real estate broker salary

According to Lightcast™, the average annual earnings for a real estate broker is $139,677.26 [2]. Like real estate agents, brokers usually earn a commission. However, since you may also manage a group of real estate agents, you may take a cut of their sales as well. 

Real estate job outlook

According to the US Bureau of Labor Statistics, the job outlook for real estate agents and brokers is 3 percent. That means the government expects the field to grow as fast as the average compared to other fields by 2032 [3]. 

Learn more with our free resources.

Exploring a career as a real estate agent? Stay updated on the latest career trends with our LinkedIn newsletter, Career Chat! Or, browse our other free resources:

• Watch on YouTube: Must-Have Skills Every Aspiring Real Estate Agent Needs or 10 Skills That Make the Best Real Estate Agents

• Take a course: The Principles of Real Estate offered by Keller Williams

• Go through a guided project: Deep Learning for Real Estate Price Prediction

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