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Do You Want To Be a Customer...or a Client? In Florida, Are REALTORS® The Same As Real Estate Agents

By Christopher Carter - Real Estate Broker Associate

May 30, 2024

As usual, an answer to this week's headline question is more involved than it may initially seem. Before trying to arrive at one, we first need to define, discuss, and expand on the following terms :

• Agency Relationships
• State Business or Professional Licensee

REALTOR® (all capitals, Registered trademark symbol) can only be used by members of the National Association of REALTORS®. The NAR is a semi-voluntary membership trade organization of individuals from all 50 States, Puerto Rico, and the US Virgin Islands who hold real estate licenses.

The term REALTOR® identifies a person as being a member of the National Association of REALTORS®. Members must hold current State-issued licenses to provide real estate services, and are expected to follow the NAR (National Association of REALTORS®) Code of Ethics in their dealings with the public.

I refer to membership as semi-voluntary because most real estate brokers and offices require their individual licensees to join the local Board of REALTORS® which includes membership in the NAR and the appropriate State Association. Licensees join all 3 organizations (local, State, and National) at the same time, each with separate membership dues.

All member real estate offices and their individual licensees agree to follow the NAR's policies, standards, and rules. The NAR does not set commission amounts, nor do they establish brokerage relationships between its members and sellers or buyers. Both of those are negotiated directly with the brokers who will be providing real estate services.

In addition to promoting their Code of Ethics, the NAR has very strict rules regarding the proper use of their trademarked logos and the term REALTOR®, emphasizing that it is never be used as a generic job description. REALTOR® = member of the NAR.

The NAR expresses their Vision "To empower REALTORS® (members•) as they preserve, protect and advance the right to real property for all." To that end, the NAR supports an extremely powerful political lobbying effort at the National and State levels through their Political Action Committee, funded by members' voluntary contributions. As stated on the NAR website: "The REALTORS® Political Action Committee and other political fundraising are the keys to protecting and promoting the real estate industry."

It is interesting to note that through continued public use, the term "realtor" (lower case, no trademark symbol) is often used as a job description for people who have real estate licenses and offer their services for paid compensation.

The term REALTOR® refers to a real estate licensee who is also a member of the National Association of REALTORS® trade organization and has agreed to follow its policies, standards, and rules.

Agency Relationships
In all types of businesses, there are agency relationships in which one person (the agent) performs duties and interacts with a third party at the instruction and for the benefit of another (the principal). Agency relationships are fiduciary, meaning the agent must put the principal's interests above her or his own, working for the best possible result and outcome for the principal.

An agreement between both parties documents the agent's duties, time period for the relationship, scope of the agent's work, limits of the agent's authority, and compensation to be paid. Agents often have specialized training, knowledge, or skills that help principals accomplish their defined business goals.

General examples of agency relationships can be:

• Attorney - Client
• Financial Advisor - Investor
• Employer - Employee

Allowed residential real estate brokerage relationships in Florida are:

Transaction Broker - the default, non-fiduciary, non-agency relationship between a seller or buyer and a real estate broker. Transaction broker licensees do not work for individual sellers or buyers, they work to facilitate the transaction for both parties. Most real estate sales in Florida are handled under Transaction Broker relationships in which sellers and buyers are referred to as customers, not clients.

Single-Agent - a fiduciary, in-writing agency relationship in which the real estate licensee and broker work to promote and protect seller or buyer interests. Under Single-Agent relationships, licensees work for either the seller or the buyer, never both. Sellers and buyers are considered clients, not customers under Single-Agent relationships.

No Brokerage - the real estate licensee and broker have neither of the above relationships with the seller or buyer, therefore no duties of disclosure, confidentiality, or service apply. No Broker means exactly what it says, the seller or buyer is not being represented in any way by the real estate licensee and broker who are involved in the deal.

Any agreement and brokerage relationship between real estate licensees and sellers or buyers is with the real estate office's broker, NOT the individual licensee. A Sales Associate may be the direct contact person and do most of the work, though agreements and relationships for real estate services are between a seller or buyer and the office's supervising broker. In residential real estate, the brokerage relationship is documented in either the Listing Agreement with a seller, or the Buyer Broker Agreement with a buyer.

Speak with a Florida-licensed real estate attorney for interpretation and application to specific circumstances regarding agency and brokerage relationships.

Transaction Broker has been the default relationship in Florida since 2003, and has not required a separate written disclosure to sellers or buyers since July 2008. Transaction Brokerage automatically applies unless and until another relationship (Single-Agent or No Brokerage) is agreed to in writing. Take a few minutes to read this earlier article on Transaction Brokerage which goes into more detail, depth, and explanation. Here's a direct link to Florida's Best-Kept Real Estate Secret - Transaction Brokerage ( ):

An agent has a fiduciary relationship with another person (the principal), putting that person's business interests above the agent's, following the principal's lawful instructions, negotiating and making decisions promoting the best possible outcome for the principal.

State-Issued Real Estate Licensee
All States have laws governing real estate sales and transfers within their borders. These laws include requirements and procedures for obtaining a license to offer real estate services to the public for paid compensation.

The Florida Real Estate Commission (FREC), a division of the Department of Business & Professional Regulation, "...was created to protect the public through education and regulation of Real Estate licensees."

First-time applicants for Florida real estate licenses must:

• Be at least 18 years old and have a Social Security number
• Hold a high school diploma or equivalent
• Pass a 63-hour pre-license course from a FREC approved provider
• Complete an application and pay required fees
• Have a background check with fingerprints submitted to the Florida Department of Law Enforcement (FDLE)
• Pass the State licensing exam

After passing the State exam, licensed Sales Associates cannot offer real estate services to the public on their own, they must affiliate with (and work under the supervision of) a Florida-licensed real estate broker. Most new licensees affiliate with broker offices where they can receive guidance on the practical application of what they learned in their pre-license courses.

Florida real estate licenses must be renewed every 2 years. During the first renewal cycle after initial licensing, Sales Associates are required to complete a 45-hour post-licensure course. For each subsequent 2-year renewal, licensees must complete a 14-hour Continuing Education course.

Renewal CE includes 3 hours of Florida legal updates, 3 hours of Ethics & Business Practices, and 8 hours of specialty training. Even if they are not members of the NAR and subject to its Code of Ethics, Florida licensees receive regular training in Business Ethics.

States establish requirements for the training, licensing, and conduct of individuals who want to provide real estate services to the public for compensation. Completing periodic Continuing Education is an integral part of maintaining a valid, current real estate license. The unlicensed practice of real estate is a third-degree felony in Florida.

That's it for this week, a brief introduction to State real estate licensing, brokerage relationships, and use of the term REALTOR®. Let's approach this week's headline question with a few observations:

• The term REALTOR® is trademarked and only allowed to be used by members of the National Association of REALTORS®. It is often misused by the public as a job description ("realtor").
• REALTORS® must hold State-issued real estate licenses, though individual licensees are not required to join the NAR unless they want to (or their brokers and offices require membership).
• In Florida, a licensee or REALTOR® is only acting as a real estate agent when working under a written Single-Agent relationship agreement with a seller or buyer. Transaction Broker (the most common relationship by far) is a non-agency relationship.

So our answer is sometimes. A Florida REALTOR® or licensee can be a real estate agent only if she or he is working under a Single-Agent relationship with a seller or buyer.

There we are - a brief introduction to the differences, yet close connections between REALTORS®, real estate agents, and real estate licensees. All 3 are closely related, and different combinations of them affect how they apply to the practice of real estate in Florida. Keep today's discussion in mind the next time you interview licensees to handle the sale or purchase of Florida real estate for you. Do you want to be a customer...or a client?

Editor's Note: Christopher Carter is NOT an attorney. He does not give legal advice. For interpretation and application to specific circumstances of anything you read in this article, you must speak with a Florida-Licensed attorney.

Have a question or comment about anything you see here, if so, visit: (•Parentheses "members" added)

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