What a Real Estate Agent Actually Does — and When You Need One

More Than Opening Doors

The popular image of a real estate agent handing over keys barely scratches the surface of what the job actually involves. From the moment a client decides to buy or sell, an agent's work begins — often weeks before any property is toured or listed.

For buyers, an agent helps clarify budget and priorities, searches listings (including off-market opportunities), schedules and accompanies showings, interprets what they see, and drafts purchase offers. Once an offer is accepted, the agent coordinates inspections, monitors deadlines, reviews disclosures, and communicates with lenders, title companies, and the seller's agent — all the way to closing day.

For sellers, a listing agent prices the home using a comparative market analysis (CMA), advises on repairs or staging, lists the property on the Multiple Listing Service (MLS), markets it to potential buyers, fields and negotiates offers, and manages the contract process through closing.

If you want to understand the terminology involved in all of this, our guide to real estate terms is a useful reference to keep nearby.

How Agents Get Paid

Real estate agents work almost entirely on commission — they earn a percentage of the home's sale price, paid at closing. Historically, this commission (often around 5–6% total) was split between the listing agent and the buyer's agent, with the seller covering both from the sale proceeds.

In 2024, a landmark legal settlement involving the National Association of Realtors introduced new rules: buyers must now sign a written agreement with their agent before touring homes, explicitly outlining how the agent will be compensated. This doesn't necessarily mean buyers pay out of pocket — sellers may still offer to cover the buyer's agent fee — but it has made commission structures more transparent and open to negotiation.

Understanding how commission works matters, because it affects how the home price is structured. Our breakdown of closing costs explains how agent fees fit into the full financial picture at settlement.

When You Actually Need One

Legally, most states don't require you to use a real estate agent. Some buyers and sellers do go it alone — a path called "for sale by owner" (FSBO) on the seller side. But whether an agent is necessary and whether one is worth it are different questions.

Consider working with an agent if:

• You're a first-time buyer unfamiliar with contracts, contingencies, or negotiation tactics
• You're buying or selling in a competitive or fast-moving market
• The property has complications (estate sale, short sale, liens, repairs needed)
• You're relocating and unfamiliar with the local market
• You don't have time to research listings, coordinate showings, and manage paperwork yourself

FSBO sellers save on commission but take on the full burden of pricing accurately, marketing effectively, and handling legal paperwork — tasks that require real expertise. Mis-pricing a home alone can cost more than what you'd save on agent fees.

If you're still weighing the broader financial picture, see our overview of renting vs. buying to understand where an agent fits in the larger decision.

What to Look for Before You Sign

Before committing to an agent, you'll typically sign a representation agreement — a contract outlining the agent's duties, the length of the relationship, and how they'll be compensated. Read it carefully.

Questions worth asking any agent upfront:

• How many transactions have you completed in this neighborhood or price range?
• Will you be my primary point of contact, or will I work with a team?
• How do you handle multiple offers or competing timelines?
• What does your fee cover, and is it negotiable?

A good agent communicates clearly, explains things without condescension, and manages expectations honestly. If something feels rushed or unclear before you've even signed anything, that's useful information.

Also consider the hidden costs of homeownership — understanding the full financial picture helps you have more informed conversations with any agent you work with.