Buying or selling a real estate property, whether it’s a house and lot, a condominium unit, or a commercial space or building can be a lot of hassle. Not only do you need to take care of all the legal documents that need to be prepared, signed, and notarized, but you also would have to do a lot of legwork. Fortunately, there is a real estate professional whom you can tap to do the “dirty work” for you.
For many, transacting in real property is something that can be daunting and, as such, should best be left to the experts. The two who come to mind immediately are the real estate broker and real estate agent, both of whom can provide valuable help in selling or buying properties. These real estate professionals make sure that when you close the deal, it’s legal and won’t give any headache later on.
It can be confusing, however. Isn’t a real estate broker an agent, and vice versa? And then, someone would also mention getting the services of a realtor instead, which could further add to the confusion. Aren’t all three the same?
Actually, they are not. Let’s distinguish each one from the others. For our purposes, we shall refer to them simply as broker, agent, and realtor, keeping in mind that we are talking about real estate professionals since other industries would have their versions of brokers and agents, especially.
Real Estate Professional 1: Broker
A broker must have passed a four-year college course of BS in Real Estate Management (BSREM), undergone further relevant training to gain more expertise in their field, and then taken and passed the Real Estate Brokers Licensure Examination administered by the Professional Regulations Commission (PRC). The license they earn allows them to manage the transaction between a seller and a buyer of real property. They also need to be there even when a real estate agent is involved in the deal.
A broker can do the job of an agent themselves or establish their own company and hire agents to do the basic tasks. The broker steps in when deals will be closed and also for other legal matters.
According to the online source Salary Explorer, the average monthly salary of a broker this year is P37,300.
Real Estate Professional 2: Agent
Also known as the Real Estate Salesperson, the agent is a duly accredited professional who works for a licensed broker in exchange for a commission, professional fee, and other compensations depending on their contract.
They don’t need to take the PRC examination but should have attended a Real Estate Brokerage Seminar (REBS) and earned 15 hours of CPD (Continuing Professional Development) units. They should also secure accreditation from the Housing and Land Use Regulatory Board (HLURB) if they will be dealing with projects such as condominiums and subdivisions registered with the agency.
The agent works under a broker and is not authorized to complete any transaction. They are, however, usually the first and consistent point of contact of either the buyer or seller, acting as their liaison. They look for prospective buyers of a property or help someone looking for a property to buy.
Sometimes, they may even help a buyer secure financing for the property. They are the ones who arrange ocular visits to the property being sold, expertly pointing out its best features to the prospective buyer to convince them to make a positive decision. In effect, an agent is also the marketing arm of the broker.
Agents can also be found in malls and other high-foot-traffic areas, giving out flyers and leaflets containing information about properties for sale. Depending on their arrangement with the broker or the brokerage company, they can be assigned a specific quota on the number of clients they can generate, which would explain why some of them can be aggressive when promoting their product.
Per Salary Explorer, an agent’s monthly salary in 2022 is P36,800.
Real Estate Professional 3: Realtor
This is a trademarked term in the United States to describe the members of the National Association of Realtors (NAR USA). Here in the Philippines, realtors apply to the members of the Chamber of Real Estate & Builders’ Association (CREBA). A broker or agent can be called a realtor if they are an active member of either of the aforementioned real estate organizations.
Broker vs. Agent: Which is better?
Dealing in real estate normally involves a large amount of money, which is why brokers and agents are compelled to secure a license or accreditation with the relevant government agencies to protect the interest of their clients. They are also expected to follow the Code of Ethics as described in the Real Estate Service Act (RESA) to further secure the interest of their clients.
But given the fact that both broker and agent are held to a high standard in the performance of their jobs, who would be a better hire if you are buying or selling a property?
All things considered, getting the services of a broker from the beginning may be a better decision. Brokers can perform the tasks of an agent quite as effectively, and they also carry with them more experience, a higher standard of education, and a license.
When you are dealing with transactions that can go up to millions of pesos, having someone who is licensed and a certified expert in the field as your guide should be an easy decision. Plus, brokers are authorized to complete the transaction, something that an agent is not allowed to do. Keep in mind, though, that brokers will usually command a higher professional fee or commission compared to agents.
Here in the Philippines, there seems to be no clear demarcation between an agent and a broker as far as clients are concerned because both practically do the same thing. Agents, however, develop a stronger bond with the client because they are their constant companions during the entire process.
Usually, it’s only during the last few steps, when the deal is being closed, that the broker gets into the picture to make sure that the transaction is legal and binding and that both parties (seller and buyer) are protected from future headaches (if it turns out to be a defective deal).
If you like this article, you may also enjoy our other writeups on various topics on real estate here at enta.ph/resources. If you are interested in buying properties, enta.ph has a lot of great listings that you can check out.