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A real estate agent is a licensed professional who represents buyers or sellers in real estate transactions. Agents help clients navigate the process of buying, selling, or leasing property, providing market expertise, negotiation skills, and transaction management. Real estate agents work under a supervising broker and earn commission based on successful transactions.

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What This Section Covers

Types of Agents

Buyer’s agents, listing agents, dual agency, and team structures

The Agent Process

What agents do from initial contact through closing

Commission and Costs

How agents are paid and what it costs

Comparing Agents

Questions to ask and what to look for

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What Real Estate Agents Do

Listing agents help property owners sell:
  • Price property based on market analysis
  • Market property to potential buyers
  • Manage showings and open houses
  • Negotiate offers
  • Coordinate transaction details
  • Guide through closing process
Buyer’s agents help purchasers find and buy property:
  • Understand buyer needs and preferences
  • Search and identify suitable properties
  • Arrange property viewings
  • Provide market insights and property analysis
  • Write and negotiate offers
  • Coordinate inspections and due diligence
  • Guide through closing process
Agents provide local knowledge:
  • Current market conditions
  • Neighborhood characteristics
  • Recent comparable sales
  • Property value trends
  • School districts and amenities
  • Zoning and development plans
Agents manage the process:
  • Contract preparation and review
  • Deadline tracking
  • Communication between parties
  • Vendor coordination (inspectors, appraisers, etc.)
  • Problem resolution
  • Closing preparation

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Licensing and Regulation

Real estate agents must be licensed by their state:
  • Complete pre-licensing education
  • Pass state licensing exam
  • Work under supervising broker
  • Complete continuing education
  • Maintain active license status
Requirements vary by state.
Real Estate Agent (Salesperson): Licensed professional working under a broker.Real Estate Broker: Higher-level license allowing independent practice and supervision of agents. Requires additional education and experience.Realtor: Agent or broker who is a member of the National Association of Realtors (NAR) and subscribes to its code of ethics. This is a trademarked term, not all agents are Realtors.
Common memberships:
  • National Association of Realtors (NAR)
  • State and local real estate boards
  • Multiple Listing Service (MLS) access
  • Specialty designations (CRS, ABR, GRI, etc.)

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When to Hire an Agent

  • Professional market knowledge
  • Access to MLS listings
  • Negotiation expertise
  • Transaction management
  • Legal compliance
  • Network of vendors and resources
  • Time savings
  • Emotional buffer in negotiations
  • First-time buyers or sellers
  • Competitive markets
  • Complex transactions
  • Limited time or availability
  • Unfamiliar with local market
  • Need for negotiation support
  • Want professional guidance
Some buyers and sellers choose:
  • For Sale By Owner (FSBO)
  • Discount brokers
  • Flat-fee MLS listing services
  • iBuyers (instant cash offers)
  • Real estate attorneys (in attorney states)
Each option has tradeoffs in cost, service, and convenience.

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How Agents Are Paid

Agents typically earn commission as a percentage of the sale price, paid at closing. No sale means no payment.This aligns agent incentive with achieving a successful transaction.
Traditionally, the seller pays total commission, which is split between the listing agent and buyer’s agent.Commission is negotiable and varies by market and agreement.
The commission is typically divided:
  1. Total commission paid by seller
  2. Split between listing broker and buyer’s broker
  3. Each broker splits with their agent based on their agreement
Individual agents may receive 40-70% of their broker’s share, depending on their experience and brokerage structure.

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Agent Fiduciary Duties

Agents owe specific legal duties to their clients:
  • Loyalty: Act in client’s best interest
  • Obedience: Follow lawful instructions
  • Disclosure: Share material information
  • Confidentiality: Protect private information
  • Accounting: Handle funds properly
  • Reasonable care: Use skill and diligence
Different representation creates different obligations:
  • Seller’s agent: Owes fiduciary duty to seller
  • Buyer’s agent: Owes fiduciary duty to buyer
  • Dual agency: Agent represents both parties (restricted or illegal in some states)
  • Transaction broker: Facilitates deal without representing either party
Agents must disclose:
  • Agency relationship
  • Material property defects
  • Conflicts of interest
  • Personal interest in transaction
  • Compensation arrangements
Failure to disclose can result in license discipline and legal liability.

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