It’s time to buy or sell your home, but who should you call? If you phone a real estate agent, is it the same as calling a broker or a Realtor? Don’t all these terms describe the same profession? Actually, no. Comparing the difference between a real estate agent vs broker vs Realtor can help your real estate transaction process.
Each of these three titles pertains to a professional working in the real estate industry. But there are subtle differences between each. To help, we’ve outlined the main difference between Realtors, agents and brokers so that you can make a more informed decision when choosing to work with your next real estate representative.
Key Takeaways
- Real estate agents are licensed individuals who help people buy, sell, and rent real estate
- A real estate broker is a real estate agent who has completed additional training and received a broker’s license
- Realtors are members of a professional organization, which requires them to pay dues and adhere to a Code of Ethics
What is the Difference Between Brokers and Realtors?
When comparing a real estate agent vs broker vs Realtor, the main difference lies in their level of education and whether they are a member of a professional association, such as the Canadian Real Estate Association (CREA).
For instance, not all agents are Realtors—being a Realtor requires being a licensed agent and a member of a national association such as CREA. Real Estate Agents or Realtors work under a brokerage for several years before they advance to a broker through additional training.
While there is a fundamental difference between Realtors, agents and brokers, all of these professionals are licensed to represent you when buying or selling real estate. Therefore, the most critical aspect is that the professional you choose to work with is not only adequately educated and licensed, but also acts in good faith to protect your best interests in a real estate transaction.
What is a Real Estate Agent?
A real estate agent is anyone with an active real estate license. Real estate agents guide property buyers and sellers through real estate transactions. Some provinces may refer to agents as real estate associates, real estate salespersons, or real estate representatives.
Requirements to become a licensed real estate agent differ from province to province. For instance, in British Columbia, agents are required to complete two courses as part of their licensing requirements. On average, this takes 60 to 72 hours to complete, excluding exams. In contrast, real estate agents in Saskatchewan must complete the educational curriculum offered by the Association of Saskatchewan Realtors (ASR) within one year.
Due to regulations, a real estate agent is required to work under the supervision of a real estate broker (or brokerage). That means you hire a real estate agent and their broker.
Agents charge a commission based on a percentage of the property’s sale price. While Canada’s Competition Act promotes free and open competition, most agents will charge a commission rate within a typical range for their province or city. The average commission rate isn’t officially collected or readily available. But it is easy to find out by asking a few agents what commission they charge.
For instance, a Vancouver-based agent will probably charge 7% on the first $100,000 and 2.5% on the remaining balance of the sale price. In Toronto, however, the total commission rate will be 5% on the full sale price, with 2.5% going to the buyer’s agent and the other 2.5% to the seller’s agent. Regardless of the agent’s location, a percentage of their commission is then paid to their brokerage. This is unless they pay a flat fee upfront to keep 100% of their commissions annually.
Real Estate Agent Responsibilities
A real estate agent typically handles most of the interactions with their clients and other real estate agents. Typical agent responsibilities include:
- Showing homes to buyers
- Organizing open houses
- Searching for properties for clients
- Market research
- Writing offers
- Negotiating real estate deals
What is a Realtor?
Realtor is a trademarked term for an agent who belongs to a recognized real estate board. For instance, an agent who pays their fees and belongs to the Real Estate Board of Greater Vancouver (REBGV) can call themselves a Realtor.
As a Realtor, these agents must adhere to the board’s Code of Ethics and standards of professionalism. Additionally, each agent who belongs to either their provincial council or the Canadian Real Estate Association (CREA) must complete ethics training on a regular, ongoing basis.
What is a Real Estate Broker?
A real estate broker is an agent who can run a brokerage and manage a team of agents. To become a broker, agents complete additional training, pass an exam, and obtain a broker’s license. A licensed real estate broker can operate their own brokerage and own business, with the authority to hire and supervise agents. They can also practice independently, unlike agents who must first join a brokerage.
A real estate brokerage must comply with real estate regulations. This includes following the Competition Act requirements and other legal regulations (such as anti-money laundering requirements). Therefore, brokers have extensive knowledge of real estate laws and regulations. Plus, they have more power and responsibilities than professionals who remain real estate agents.
There are different types of real estate brokers, who have different levels of responsibilities:
- Associate broker – Have the training; however, they are not in charge of the brokerage
- Managing broker – Actively manages the brokerage and ensures business is in accordance with regulations
Real Estate Broker Responsibilities
A real estate broker has more responsibilities than an agent, and generally oversees the entire real estate office and brokerage firm. Typical broker responsibilities include:
- Overseeing other agent deals
- Reviewing contracts
- Ensure business is in accordance with provincial and federal regulations
- Ensure that trust accounts and records are maintained
- Showing homes to buyers
- Organizing open houses
- Searching for properties for clients
- Market research
- Writing offers
- Negotiating real estate deals
What are a Listing Agent and Buyer’s Agent?
A broker, Realtor or agent can act as a listing agent or a buyer’s representative. A listing agent, also known as a seller’s agent, represents the seller by marketing and negotiating on their behalf. On the other hand, buyer’s agents, sometimes known as buyer’s representatives, represent buyers by finding suitable properties, negotiating terms and assisting with paperwork.
Regardless of who you choose to work with, these real estate professionals all have something in common: They owe their clients a legal responsibility to protect their best interests in a real estate transaction. That means each real estate professional must put their client’s needs and financial well-being ahead of all other factors.
It also means that any agent who ends up representing both the buyer and seller in the same transaction (known as a dual agency) must be upfront about this potential conflict of interest and obtain the written agreement of both the buyer and the seller.
Choosing Between a Real Estate Agent vs Broker vs Realtor
Both real estate agents and brokers are well-equipped to help you buy or sell a home in Canada. Choosing the right real estate professional comes down to their specialities and your needs as a buyer or seller. Here are some considerations before you hire a real estate agent or broker:
- Licensing – Ensure that whoever you choose is licensed and in good standing with their regulatory body. By searching on your provincial regulator’s website, you will be able to see if they have any history of disciplinary action or license restrictions
- Specialty – A professional who specializes in the type of property you want to buy is helpful. Additionally, someone who is an expert in your prospective neighbourhood is an asset, whether you are buying or selling
- Fees – Commissions are negotiable, so be sure to ask about their typical fees before you sign a representation agreement
- Availability – In hot markets, homes can sell quickly. You’ll want to ensure your agent is available when you need them, as some agents only work part-time
Bottom Line
When choosing the right professional, remember that every agent has different capabilities and focuses in the real estate industry. To ensure you’re working with the right person, remember to interview a few real estate professionals and focus on their knowledge, experience, and whether they can and will effectively work with your needs and requirements
Real Estate Agent vs Broker vs Realtor FAQs
How do you become a real estate broker?
Becoming a real estate broker in Canada varies by province. Generally, you must be a licensed real estate agent and complete additional education. In many provinces, you must have at least two years of experience as a licensed salesperson or conduct a minimum number of real estate transactions.
How much do real estate agents make?
According to the Government of Canada’s Job Bank, residential real estate agents in Canada earn between $32,867 and $178,000 per year, with a median annual wage of $58,400. However, a real estate agent’s income varies depending on where they live and the number of real estate transactions they complete in a year.
How many Realtors are there in Canada?
According to the Canadian Real Estate Association (CREA), there are over 160,000 Realtors across Canada. This includes brokers, agents and salespeople, working through 61 real estate boards and associations in Canada.
Is a broker better than an agent?
A broker is not necessarily better than a real estate agent or Realtor. While a broker may have more real estate experience, that is not always the case. Before you hire a real estate agent or broker, it’s essential to ask questions about their license, experience, specialty, availability, and fees.
What exactly does a broker do?
A real estate broker oversees agents to ensure that each deal goes smoothly. Brokers review contracts and ensure all transactions are compliant and legal. Additionally, brokers are responsible for maintaining a trust account that holds deposits and commissions, and they will handle any legal issues that may arise.
