When looking at a real estate listing, you've likely noticed that sometimes the contact is referred to as a broker, and other times as an associate broker, salesperson, or agent. What's the difference—and does it matter when you’re looking to rent, buy, or sell a place in NYC?
Salesperson or agent
These two terms are interchangeable, though in New York, the Department of State, which issues real estate licenses, uses salesperson. A real estate salesperson is someone who has completed the state’s 75-hour approved qualifying education course, and passed a 90-minute exam with 75 multiple-choice questions that cover the topics in the pre-licensing curriculum.
After they’ve received their license, salespeople are qualified to work in the industry, though they must be supervised by a licensed real estate broker. According to the New York Department of State, a real estate salesperson “facilitates the purchase and sale of property on behalf of customers, obtains lists of property for sale with an employing broker, and assists buyers (customers) of real estate to locate and purchase property (listed with employing brokers or another broker).”
“To get your license, you have to be sponsored, and a salesperson has to have their license held by a sponsoring broker and work under the guidance of a broker,” says Eileen Foy, an associate real estate broker with Douglas Elliman. “They can’t just have their own business.”
(By the way, if you're thinking about going into the real estate business, read this account of one person’s experience working as a salesperson.)
Broker or associate broker
Brokers and associate brokers must take an additional 45-hour course and 150-minute, 100 multiple-choice question test to get their broker’s license, which allows them to own a brokerage and be legally responsible for its activity.
Most of the additional education involves law, such as agency law, license law, and real estate law. For the state’s official description of a broker’s responsibilities, click here.
Before attempting a broker’s license, a salesperson needs at least two years experience as a licensed salesperson or at least three years of experience in the general real estate field or a combination of both, plus they must meet a minimum number of points required for the experience type (e.g., buying and selling your own property, managing property owned by your employer, etc.). Attorneys admitted to the New York State bar are exempt from the educational, experience, and examination requirements for brokers. They can submit a completed application and fee, indicating on the application that they are admitted to the New York State bar.
Brokers also are responsible for the running of the business, i.e., marketing and placing advertisements, maintaining escrow accounts, and must understand real estate license law. Associate brokers are usually someone who has their broker license but doesn't want to own their own business, so they still work for someone else, like a Citi Habitats, Corcoran, or Douglas Elliman.
Licensing and Fees
Some agents, especially if they’re working at a big brokerage where associate brokers are essentially doing the same job, decide not to take their broker’s exam. It can also come down to fees.
The salesperson application fee and renewal are $55 each. For brokers it’s $155 for each. The price to take each exam is the same for both: $15. Licenses are issued for two-year terms and must be renewed upon license expiration to remain continuous. Licenses can be renewed only up to two years beyond their expiration date.
So, does it matter who you work with?
It depends. A new broker will have at least two years more experience than a new salesperson, but you could just as easily wind up working with a salesperson with 20 years of experience who doesn't want the responsibilities of running a business.
“For the day-to-day job, a licensed salesperson and licensed broker can assist clients. There’s no effective difference,” says Andrea Saturno-Sanjana, an associate broker with Citi Habitats who earned her brokers license about eight months ago. However, unlike an agent or salesperson, a broker can legally "sign listing agreements and do anything involving that real estate transaction. The question is, why does someone go for the extra study and pay the higher fees to be a broker? They want to be their own boss. ... Or in a lot of the big brokerages in New York City, someone might want to work on the management side. If they're a managing director of 200 agents in an office, they have to have a broker’s license because they’ll be signing on behalf of the principal broker.”
“For me, I did it for the education,” Saturno-Sanjana adds. “The more you know about your industry and the more you know about what’s out there, the better you are to serve your clients and the more fulfilled you are.”
Practically speaking though, most renters, buyers, and sellers don’t draw a distinction between brokers versus salespersons. "Clients basically look for people with experience who they believe can sell their property at the highest price and handle it in a professional manner,” Foy says.
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