Difference Between a Brokerage, Team, and Agent
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Why is the Difference Important?
There are several reasons why it is important to understand the difference between a real estate agent and a broker. The most important reason is that each offers its own set of unique advantages when it comes to pursuing a career in real estate. Working as a real estate broker is not the same as working as a real estate agent. By the same token, working as a solo real estate agent is not the same as working as part of a real estate team. Each of these career paths provides unique opportunities and working environments that are certainly worth considering.
The more information a person is armed with as they begin their real estate career, the better informed their decisions will be. Questions such as "What is a real estate broker?" and "What does a real estate broker do?" are an important foundation for a complete education and will real estate students select the direction they want to pursue. With that in mind, let's take a look at the important distinctions between a real estate brokerage, team, and agent.
What is a Brokerage?
A real estate brokerage is a company that consists of a team of real estate agents. Meanwhile, a real estate broker is a real estate agent who has the option of working on their own or hiring real estate agents to work under them as part of the brokerage.
Many people do not realize that when they receive their license as a real estate agent, they aren't automatically able to begin working independently. Instead, real estate agents are required to work under a brokerage. To work under their own name or start their brokerage and hire real estate agents to work under them, real estate agents are required to take additional training courses and pass a broker licensing exam in addition to having first worked a certain number of years as a real estate agent. The exact requirements to receive a license as a real estate broker can vary dramatically from state to state, so it's important to check the state's specific requirements ahead of time.
The advantage of working as a real estate broker, though, are considerable. In addition to being able to work under their own name rather than working for someone else, attaining a license as a real estate broker also enables real estate agents to start their own agency and hire employees, meaning that working as a real estate broker provides a high degree of upward mobility.
What is a Team?
A real estate team is a group of real estate agents who work together to pursue the same leads. Real estate teams almost always work for a real estate brokerage and are typically directed by a team leader. However, this team leader isn't always a real estate broker. Instead, many real estate brokers will choose to assemble a team for their brokerage and choose a team leader to work directly beneath them in charge of the team.
At the same time, not all real estate brokerages choose to employ real estate teams. Many brokerages decide to employ a group of solo agents who work independently to pursue their own individual leads rather than employing a real estate team.
There are several important considerations when deciding between working on a team or working on your own as a solo agent. Since working on a team requires much more collaboration and reliance on others, it is essential for real estate agents to choose a team whose personality and work ethic aligns with their own. If an agent can find a great team to work with, working as part of a real estate team can be an excellent career, particularly for new real estate agents who will especially benefit from the extra structure and guidance that a real estate team provides.
What is an Agent?
Anyone who receives their real estate license can begin working as a real estate agent. However, real estate agents who have not acquired their broker license will be required to work under a brokerage either as part of a team or as solo agents.
Unlike working as part of a real estate team, working as a solo agent means that a real estate agent will be solely responsible for generating leads and helping those leads through the process of buying or selling a home. Working as a solo agent instead of part of a real estate team means that an agent will have more freedom to make their own career decisions. However, it also means that they may not receive the same degree of assistance and guidance that working for a team provides.
Once an agent acquires their real estate license, choosing to work as part of a real estate team or on their own as an agent for a real estate brokerage is one of the first career decisions they will need to make. After several years of experience, real estate agents also have the option to pursue their broker license and work as real estate brokers. In the end, the best option will depend on the agent's unique personal preferences and career goals. Understanding the key differences between these various real estate roles is an important place to start.