For both industries, a broker is one who is licensed to execute transactions while a sales agent is only permitted to assist the broker in bringing together a transaction. Hence, this leads to the more pragmatic definitions of brokers and sales agents offered by others: Brokers 1) must stand to a high level of industry knowledge and competence as verified by examination, 2) are able to legally open a brokerage, 3) take on nearly all liability for issues with transactions, and 4) bear additional operating expenses like insurance. Sales agents/"Agents" 1) meet minimal standards of industry knowledge by examination, 2) must work for a licensed broker, 3) have fewer responsibilities and accept fewer liabilities, and 4) receive after-expense commission splits from brokers.
As mentioned, a broker can choose to work under another broker's brokerage and be positioned somewhere between a broker-owner and a sales agent in terms of responsibility.
The relationship between broker and sales agent is very similar to that between a doctor and nurse or a lawyer and paralegal. So, just like an experienced nurse may have far more practical knowledge than a fresh doctor, the ultimate responsibility still lies with the doctor and his judgment.
While it would be most ideal for clients to work directly with brokers, the reality is that they've often got limited available time as they're overseeing their brokerage, managing their sales agents, and reviewing contracts. So, if you have an opportunity to work with a broker, that's a great luck of the draw. Otherwise, experienced sales agents are more than sufficiently helpful for most clients' needs.
I don't know if agency relationships are interpreted differently in Florida, but what you wrote is misleading. A real estate agent or salesperson does not have a principal. Only the real estate broker may have a principal and is an agent of the principal. A real estate salesperson is an agent of the real estate broker and has a fiduciary responsibility in servicing the principal of the real estate broker.
The old practice of interchangeably using the terms "real estate agent" and "agent" makes this very confusing. In California, the DRE is moving towards using the terms "broker" and "salesperson" for the sake of consumers.
The term varies some in certain states, but generally a person becomes an agent first, and if they choose to after some level of experience required by law, can later become a broker.
A Broker can be an associate broker or a managing broker. An associate broker may or may not manage other agents. A managing Broker is responsible for the actions of the agents they supervise. All agents must be associated with a broker to conduct business.
There are good agents, with many years of experience who never decide to become Brokers. To become a broker the education requirements are greater, another more substantial test must be taken and typically the licensing fees are greater. I hope this helps.
I'd be happy to help if you need real estate assistance.
An Agent has a principal, you for instance. A broker can too if he or she lists or sells property. An agent must take additional classes and pass additional tests to obtain a broker's license.
A Broker can open an office or run an office and have control over other agents and brokers. Agents can not.
Aidet answered perfectly! In Florida an Agent has to have their Real Estate license with a Broker, but either can sell Real Estate.
Please let me know if I can help you with your home search. I specialize in Cooper City and the surrounding areas.
Stefanie Cohen, PA, ABR, SFR
Prudential Florida Realty
Hope this helps