Quick Takeaways
- All REALTORS are licensed agents, but not all agents are REALTORS.
- REALTORS must join the National Association of REALTORS and follow a strict Code of Ethics.
- The main practical difference for consumers is the added fiduciary protection a REALTOR provides.
- Both can list property on the Multiple Listing Service (MLS), but only REALTORS can claim "Realtor®" branding.
- Understanding the distinction helps you choose the right professional for buying or selling.
What Is a REALTOR?
When you hear the term REALTOR is a licensed real‑estate professional who is a member of the National Association of REALTORS and subscribes to its Code of Ethics, it signals a specific set of standards beyond a regular real‑estate license. The trademarked word “Realtor®” can only be used by members in good standing with the NAR, which means they have passed background checks, paid annual dues, and agreed to uphold ethical rules that cover honesty, disclosure, and client‑first conduct.
In Australia, the equivalent body is the Real Estate Institute of Australia (REIA), but the term "Realtor" is still common in marketing material for properties that attract international buyers. Whether you’re dealing with a Melbourne suburb or a remote regional town, a Realtor brings two layers of accountability: the state licensing board and the national association.
What Is a Real Estate Agent?
A Real Estate Agent is anyone who holds a state real‑estate license and can represent buyers or sellers in a transaction but does not necessarily belong to the NAR. In Australia, agents must be registered with the state’s Consumer Affairs or Fair Trading department and complete a prescribed set of courses, typically 120‑150 hours of study covering property law, ethics, and market analysis.
Once licensed, an agent can work under a broker, advertise listings, negotiate offers, and collect commission. The key point is that the term "agent" only guarantees the person has met the minimum legal requirements to practice; it does not promise adherence to any additional code beyond the state’s basic regulations.
How Licensing Works for Both Roles
Both REALTORS and real‑estate agents start with the same foundation: a state‑issued licence. In Victoria, for example, the licence costs around AUD 600 and must be renewed every two years. The curriculum covers:
- Property law fundamentals
- Contract preparation and settlement procedures
- Consumer protection and fair trading
- Basics of the Multiple Listing Service (MLS)
After passing the exam, the individual can call themselves a licensed agent. To become a REALTOR, the next step is joining the National Association of REALTORS (or the local equivalent) and paying an additional annual fee of roughly USD 150. Membership also requires a background check and agreement to the 17‑article Code of Ethics, which adds duties such as:
- Putting the client’s interests above personal gain
- Disclosing any known material defects in a property
- Respecting the exclusive rights of other REALTORS when showing a listing
Key Functional Differences on the Ground
In day‑to‑day transactions, the differences often boil down to three practical areas:
| Attribute | REALTOR | Real Estate Agent |
|---|---|---|
| Membership | National Association of REALTORS (mandatory) | None required beyond state licence |
| Code of Ethics | 17‑article NAR Code (enforced) | State regulations only |
| Branding | Can use the ® trademark | No trademark protection |
| MLS Access | Full access, can list and co‑operate | May have limited access depending on broker |
| Continuing Education | Required 2‑year NAR courses + state CE | State CE only |
Notice that both can list on the MLS, but a REALTOR can do so under the Realtor® brand, which many consumers recognize as a sign of professionalism. Brokers often prefer to have REALTORS on their team because the ethical guidelines reduce the risk of disputes and legal challenges.
Why the Code of Ethics Matters to You
The NAR Code of Ethics is more than a brochure-it’s a binding contract. If a Realtor breaches the code, they can face disciplinary action that includes fines, loss of membership, or even revocation of the Realtor® title. For a buyer, this adds a layer of protection. Imagine a scenario where a seller fails to disclose water damage. A REALTOR is obligated to disclose that fact to the buyer; a non‑member agent might overlook it, leading to costly repairs later.
Additionally, the Code requires REALTORS to treat fellow agents fairly. This means you won’t see shady tactics like “dual agency” without full disclosure, unless you explicitly consent. While some agents do follow similar ethical standards voluntarily, the formal code gives you legal footing if something goes wrong.
Commission Structures: Same or Different?
Both REALTORS and agents typically earn a commission of 2‑3% of the sale price, split between the seller’s and buyer’s sides. The split is negotiated between the broker and the professional, not dictated by title. However, because REALTORS often belong to larger networks, they may have access to shared marketing resources that can reduce the overall cost to the client. Some brokers offer a lower commission rate to agents who are also REALTORS, leveraging the brand’s trust factor to attract more business.
When you compare offers, ask for a clear breakdown:
- Base commission percentage
- Broker split
- Any additional marketing fees (photography, portal listings)
- Whether the professional is a Realtor® and how that impacts service quality
Common Misconceptions
Misconception #1: "All agents are REALTORS." The truth is only a fraction of licensed agents join the NAR. In the U.S., roughly 30‑35% of agents have Realtor® status; in Australia the percentage is similar for REIA members.
Misconception #2: "REALTORS are more expensive." Cost is driven by commission rates, not by title. In many cases, a Realtor can negotiate the same or lower rate because their network provides economies of scale.
Misconception #3: "Only Realtors can list on MLS." State‑licensed agents can access the MLS through their broker; the distinction is that a Realtor can also list under the Realtor® brand, which adds marketing cachet.
Choosing the Right Professional for Your Transaction
Ask yourself three questions before signing a listing agreement or buyer’s representation contract:
- Do I want the added ethical safeguards that come with a Realtor®?
- Does the professional have a proven track record in my neighbourhood?
- Can they demonstrate transparency in commission and fee structures?
If the answer is yes to all three, a Realtor® is likely the safer bet. If you find an agent with a strong local reputation, solid reviews, and transparent fees, they can be just as effective-just remember they won’t carry the NAR Code of Ethics badge.
Bottom Line
Both titles indicate a licensed professional capable of handling real‑estate transactions. The Realtor® designation adds a layer of ethical commitment, national branding, and often broader MLS participation. Understanding these nuances helps you make an informed decision, whether you’re buying a first‑home condo in Carlton or selling a family home in the Dandenong Hills.
Can a real estate agent become a REALTOR?
Yes. After obtaining a state licence, the agent simply joins the National Association of REALTORS, pays dues, and agrees to follow the Code of Ethics. Once accepted, they can legally use the Realtor® trademark.
Do Realtors charge higher commissions?
Not necessarily. Commission rates are set by the broker, not the title. Some Realtors negotiate lower rates because their brand can attract more clients, offsetting marketing costs.
What is the MLS and why does it matter?
The Multiple Listing Service (MLS) is a database where agents share property listings. It gives buyers access to a wider inventory and sellers greater exposure. Both REALTORS and agents can list on the MLS, but Realtors can also market the listing under the Realtor® brand.
Is the Realtor® Code of Ethics enforceable?
Yes. Violations can lead to fines, suspension, or revocation of membership. The Code provides a legal framework that protects clients and ensures professional conduct.
How do I verify if an agent is a Realtor?
Visit the official Realtor.com directory or the local NAR chapter site. Look for the ® symbol next to the professional’s name, and ask to see their membership card or NAR ID.
