Browse Proptionary encyclopedia

Build your real estate vocabulary to be able to communicate and invest more effectively and professionally.

Real Estate Salesperson


Party licensed to act on behalf of a broker for the execution of a purchase, sale, lease, or renting of real property.


A real estate agent — also referred to as a real estate salesperson — is a licensed professional who has the legal right to represent a principal in real estate transactions. A principal refers to a buyer, seller, or renter who uses an agent in his or her negotiations with a third party in order to buy, sell, transfer, exchange, or rent property.

An agent typically pays a fee or a percentage of his or her commissions to a broker for using the broker’s platform (i.e. paperwork, contracts, company name) and assistance. Agents perform the work in a transaction, although contracts will be identified under the broker’s name.

A real estate salesperson is not authorized to act independently of the employing broker. The salesperson represents the interests of the broker, who is technically considered an agent of the principal. Should an employer require a task that results in an agent losing money or incurring an expense, the broker is required to indemnify the employee for expenses or losses resulting from the directions or tasks of the broker.

Salespersons and brokers associates are employees of the supervising broker; however, as mentioned above, for tax purposes, they are considered independent contractors. For the independent contractor status to be executed, a contract between salespersons and brokers must indicate the independent contractor nature of the parties engaged. According to Business and Professions Code Section 100032, the independent contractor status of salespersons and broker associates does not reduce the liability for supervising brokers.

Getting a Salesperson License

To represent buyers and sellers, a party is required to get licensed in the state they wish to perform business. Each state has specific rules, regulations, and requirements needed in order to qualify for the salesperson exam. Prospective salespersons must take the minimum amount of hours required and study the necessary courses to obtain licensing. While states educational requirements for licensing vary, there are two main courses each party is required to take. They include taking a Real Estate Principles Course and a Real Estate Practice. Students must take one additional course, considered an elective class of their liking. Course options include Real Estate Law, Real Estate Appraisal, Mortgage Processing, and others. The most popular and useful elective is Real Estate Law as it involves subjects that are most likely to be useful to a salesperson.

Salesperson Regulations

Agents are not permitted to work using their own license. They must hang their license with a broker of their choice to perform business. An agent is considered a self employed individual for tax purposes, however from a legal standpoint, brokers are responsible for the actions of the salesperson. Because the process of executing and closing a transaction is a complex process, brokers are expected to give guidance to agents. In return, agents give a percentage of their commission to the employing broker. Broker fees vary and are based on the guidance, training, resources and service brokers give their agents.