Good to Know February 24, 2023

Realtor vs. Real Estate Agent: What’s The Difference?

Many people are unsure about the difference between a real estate agent and a Realtor, but those in the industry know that they are not interchangeable. In this guide, I’ll explain how this works and provide you with the information so you’ll know the distinction between the two.

A real estate agent is someone who is licensed to assist individuals in buying and selling commercial or residential property. This can be done as a sales professional, an associate broker, or a broker. To obtain a real estate license, agents must complete a specific number of classes and pass a state-prescribed examination, which varies in requirements from state to state. The Bureau of Labor Statistics indicates that real estate licensing applicants may need to complete anywhere from 30 to 90 hours of classroom instruction from an accredited college, university, or technical school, depending on the state. Additionally, applicants must pass an exam that covers national as well as state and local real estate law, standards, and practices. All real estate agents must pay an annual licensing fee and renew their licenses every one or two years, depending on the state. In some states, agents may have to complete a certain amount of continuing education courses before their licenses can be renewed.

On the other hand, a Realtor is a trademarked term that refers to a real estate agent who is an active member of the National Association of Realtors (NAR), the largest trade association in the United States. The NAR was founded more than a century ago and was originally named the National Association of Real Estate Exchanges. It changed its name in 1916 to The National Association of Real Estate Boards, and in the same year, a real estate agent named Charles N. Chadbourn proposed the use of the term “Realtor” to distinguish members of the association from non-members. The association obtained the copyright and trademark on the term in 1950 to protect it from misuse. The association adopted its current name in 1974.

In summary, while all Realtors are real estate agents, not all real estate agents are Realtors. The difference lies in membership with the National Association of Realtors. It’s important to note that being a Realtor is not a requirement to practice real estate, but those who are members of the NAR are held to a higher standard of ethics and must abide by a Code of Ethics and Standards of Practice.