What's the Difference Between a Broker vs. Realtor?

Updated July 19, 2023

A person with straight hair stands in a city with buildings in the background

Brokers and realtors are both types of real estate agents who possess specific credentials. While similar, these two titles signify different licensure and have separate job duties. If you're interested in advancing your career as a real estate agent, it may be helpful to know the differences between being a realtor and a broker.

In this article, we define what a broker and a realtor are, list the differences between a broker vs. realtor and offer tips on choosing between the two careers.

Key takeaways:

  • Both brokers and realtors begin their careers as real estate agents, then pursue further licensure.

  • A realtor is a specific credentialed role for a real estate agent, while a broker is a more advanced role with greater responsibility, and it includes the authority to manage others.

  • Brokers and realtors can earn money from commissions, and both roles have their advantages and considerations. 

What is a broker?

A real estate broker is a real estate agent who has special real estate licensing that allows them to represent different parties during a transaction. They're able to practice real estate independently. The three main types of real estate brokers include:

  • Principal broker: A principal or designated broker manages licensed real estate agents. Principal brokers earn a percentage of their employees' commissions, and they implement internal procedures to mitigate risks and prevent legal or ethical violations from affecting real estate transactions. 

  • Managing broker: This broker works primarily in an administrative office role and handles tasks like hiring and training agents, supervising other office staff and overseeing office transactions. Some principal brokers also work as managing brokers.

  • Associate broker: While this broker has their broker's license, they work under the guidance of a managing broker. They fulfill typical broker duties but rarely supervise other agents.

Related: What Is a Real Estate Broker? (Definition, Duties and Types)

What is a realtor?

A Realtor is a trademarked name for a real estate agent who's joined the National Association of Realtors (NAR) and possesses a license that enables them to help people buy and sell real estate. This licensure signifies high ethical standards in the industry. Through the NAR, realtors can access industry webinars and legal resources that they can use to resolve disputes, in addition to relevant historical data that can help them perform their duties. Real estate agents typically represent a home buyer or a seller.

Related: Learn About Being a Realtor

Broker vs. realtor

Real estate brokers and realtors perform many similar tasks and possess a license that allows them to help their clients buy, sell or rent a property, but there are some notable differences between the two roles. These differences include: 

Level of independence 

A broker is a more advanced role than a real estate agent or realtor. While a realtor or real estate agent typically works directly for a broker or a firm, a real estate broker can work as an independent contractor or begin their own brokerage. Having a brokerage license can allow a broker to earn higher commission rates and become more independent.

Related: Real Estate Agent vs. Broker vs. Realtor: Definitions and Comparison


Realtors help people buy and sell real estate, and their membership in the NAR provides them with access to the multiple listing service (MLS) for the state where they operate. The MLS is a tool that real estate agents use to keep track of property listings that other real estate agents host. Using the MLS provides a real estate agent with more properties when trying to satisfy a client with specific requirements, and it also makes it easier for a larger number of clients to view a property that a homeowner wants to sell quickly. 

The MLS also provides advanced search functions that allow agents to filter property listings based on specific criteria, such as location, price range, property type and amenities, which can help save time. A broker performs many of the duties a real estate agent does, but they also possess the ability to manage agents and create contracts. Brokers might help mediate real estate contract-related legal disputes and manage the funds in escrow accounts. Some additional tasks that a broker might have during a typical workday include:

  • Hire, train and manage a team of real estate agents

  • Write contracts and supervise real estate transactions

  • Assist clients with preparing and marketing their property listing

  • Negotiate with property sellers and buyers to facilitate purchase agreements

  • Conduct market analyses and perform research to provide pricing recommendations

  • Manage client relationships and provide them with personalized services 

  • Oversee financial matters by managing escrow accounts and disbursing funds

Related: Real Estate Broker vs. Salesperson: Which Career Is Right for You?


It's necessary for both brokers and realtors to pass their state licensing exam and become real estate agents before they can practice. Real estate agents who already possess their real estate license and have at least one year of experience may be eligible for their state's broker's licensing exam. Some states require a certain number of transactions or transactions of a specific dollar amount to qualify. To apply for a broker's license, it's important for a real estate agent to take a state-approved broker education course and pass the licensing exam.

There are a few different course levels, including broker pre-licensing courses, real estate designation programs and the Graduate Realtor Institute (GRI) training program. To join the NAR and become a realtor, it's important for candidates to have an active real estate license for the state in which they plan to practice. NAR also asks that candidates have an active membership with a real estate association within their state. It additionally requires each of its members to take a course on business ethics every three years, and Realtors pay a yearly fee to maintain their NAR membership.

Related: How To Become a Realtor in 8 Simple Steps


Brokers and realtors each make money by keeping a percentage of the sale of a property as their commission. If a real estate agent is working with the owner of the property, they typically establish a commission rate when they contract to sell the house. If a client hires a real estate agent to help them find a property to buy, the real estate agent can include their broker's fee in the sale price of the property. A real estate broker earns a national average salary of $91,082 per year, while a realtor earns $96,384 per year.

Several factors can affect these salaries, including geographic location and market conditions. Real estate personnel in locations with more expensive properties may have the potential to mean a higher annual salary. Brokers can also accept a share of the commission that the real estate agents who work for them earn. If their brokerage performs well, they may earn a higher salary. For the most up-to-date salary information from Indeed, click on the links provided.

Related: How Is a Real Estate Agent's Commission Split With a Broker?

Tips for choosing between a career as a broker vs. realtor

Brokers and realtors are both real estate agents and a broker can also be a member of the NAR. These roles have several similarities and differences, and if you're deciding between which role to pursue, it can be beneficial to review a few useful tips. Here are some tips you can use to help you choose between becoming a broker or a realtor:

Consider your desired salary

When choosing between becoming a broker or a realtor, think about your salary expectations. A broker may have more opportunities for a higher salary because they're qualified for higher positions within a real estate brokerage, but a realtor may also earn more money, depending on the market where they operate. They can also increase their commission rates by working as an independent contractor.

Related: How To Start in Real Estate

Assess how much responsibility you want

If you're interested in working as an independent contractor, it may be preferable to gain licensure as a broker. If you're satisfied with your real estate agent salary and are interested in networking and closing deals, joining the NAR as a realtor may be preferable. Keep in mind that becoming a principal broker often means working in managerial roles and overseeing other real estate agents' sales and transactions. This requires developing more leadership and management experience. 

Determine how much time you're willing to spend training

Becoming a broker requires accumulating prior real estate experience, taking broker courses and completing an exam. If you're interested in the benefits that becoming a broker can provide, then it may be worthwhile to spend some time obtaining your license. Before taking the broker exam, consider doing some research about the specific qualifications brokers require in your state. If you're only a part-time agent and you're not interested in the additional responsibilities of becoming a broker, you may prefer to simply register with the NAR and become a realtor.

Please note that the company mentioned in this article is not affiliated with Indeed.


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