Whether you are a buyer or seller, when you sign a contract with a Realtor, you are not signing a contract with the person sitting beside you at your kitchen table. You are signing a contract with the Realtor’s broker. What is a broker? Let me explain.

I don’t know.
Well… it’s not that I don’t know, it’s just complicated.

The Ctrl-Alt Podcast: The Invisible Boss Behind Your Real Estate Agent

At the time of writing, I think Keller Williams Coastal and Lakes & Mountains has roughly 582 agents across New Hampshire, Maine, Massachusetts, and Vermont. “Oh, you work for Keller Williams? Do you know so-and-so?” No, I do not because that many agents spread across four states is a lot of people. I do know the bread-and-butter people. To name a few: Melissa Lesniak, Susan Kenyon, Shannon Whaley, Purple Acorn. Then there are the agents I know who do not know me: Darlene Colwell-Ellis, Michael Gagnon, Adam Dow. Purple Acorn, by the way, is a team led by Marcus Katkin. What’s a team? Not a group. But I’m getting ahead of myself. Let me back up.

What is a Realtor?

A Real Estate Salesperson or a Sales Agent is a legal license category. A salesperson:

• Is licensed by the state

• Must work under a brokerage

• Cannot operate independently

• Owes fiduciary duties to clients

• Is regulated by the real estate commission.

In New Hampshire and most states, this is the baseline license. No club. No team. No group. No brand. Just law. This is the legal reality.

A Realtor, on the other hand, is a member of the National Association of Realtors (NAR).

Supposedly, no real estate salesperson is forced to belong to the NAR. But NAR gatekeeps the MLS—the Multiple Listing Service—where Zillow, RedFin, Homes.com, and all the rest get their property information from. That’s an automatic thing that happens: a Realtor enters the home for sale information into the MLS database, the MLS then feeds Zillow, and you, John Q. Public, get to see what’s for sale. So, when a Realtor tells you that they publish your listing across Zillow and the other 10 or so consumer real estate platforms, don’t let them fool you: that bit happens automatically.

Membership Matters

There are multiple MLSs, and access to the MLS is through local Realtor associations. In other words, you have to join a local Realtor board. I belong to the Strafford County Board of Realtors, but others like the Seacoast Board also exist. To be eligible to join a local Realtor board, State and National NAR membership is a requirement. Which requires paying dues and accepting the Code of Ethics (so I’ve signed paperwork that says I will never lie nor badmouth another Realtor, plus I pay a butt-load of money to have access to information everyone already has).

You can be a perfectly legal real estate agent lie cheat steal tell outlandish stories about how used car salesmanshippy Realtors really are, and not be a Realtor. But only if you don’t need the MLS. And only if you’re working underneath the umbrella of a broker who doesn’t require MLS access. Which means, you kinda need to be a Realtor.

Real Estate 101

Real estate without the real-estate-speak.

A Coffee With Steve Publication

The Broker of Record

When you sign an agreement with a Realtor, as said before, the contract is between you and the brokerage. According to state law, all licensed agents must work under the supervision of a brokerage.

A brokerage exists to hold trust accounts for one. So if you ever wondered what escrow is, that’s when you provide the seller a partial or full down payment, and the brokerage takes that money, sticks it in an escrow bank account, and holds the cash until the real estate transaction goes to closing and crosses the finish line.

The brokerage also provides systems and policies, carries insurance, and creates compliance procedures.

For example, I do not myself personally carry business insurance. As a Realtor with KWCLM, I pay a monthly “desk fee” that KWCLM uses to cover Errors and Omissions insurance. Also, when I turn in real estate transaction contracts made between buyers and sellers, the paperwork moves through KWCLM’s compliance team. They always yell at me about a missing checkmark or missing comma, and I’m incredibly happy they have eyeballs on my stuff because something can always be missed. The compliance team keeps everyone and their money safe: the broker, the buyer, the seller, the Realtor.

The broker is the license-holder responsible for everything done under the brokerage name, and

• Must supervise agents

• Must ensure compliance with state law

• Must maintain records

• Is legally liable for agent misconduct tied to transactions.

Brokerage oversight exists to supposedly protect the public, limit systemic risk, and preserve the license structure. A brokerage is not necessarily designed to make agents better, smarter, or richer. They are an agent’s legal sponsor, and they will cut the rope the moment you become radioactive.

The hard truth, though, is that brokerage oversight exists so the state can regulate real estate indirectly at scale without losing control of who is allowed to touch the transaction; consumer protection is real but functions as the justification, not the engine.

As much as anyone in the real estate industry will tell you until they are absolutely blue in the face, the real estate market is not pure capitalism. The more accurate term is managed capitalism.

Managed capitalism is a hybrid where:

• Markets set prices

• The state sets boundaries

• Entry is gated

• Intermediaries are licensed

• Failure is slowed, not allowed to cascade.

In fact, real estate is proof that capitalism only survives by refusing to fully trust itself where homes, debt, and political legitimacy intersect.

Brokerages are required by the state to manage the plethora of agents so the state does not have to manage the agents. We have a lot of agents in New Hampshire—about 6500. To put that in perspective, the state has only about 2300 auto dealerships.

Back to the Purple Acorns

Marcus Katkin leads the Purple Acorn team. But Purple Acorn is not a brokerage. Marcus has a cool logo, a cool name, and right underneath is the Keller Williams Coastal and Lakes & Mountains logo.

A real estate team is made up of one or more licensed agents working under the leadership of one or more licensed agents. In the case of Purple Acorn, Marcus has, I believe, three people working underneath him. That mix of people can include other licensed agents, sometimes w-2 staff like an admin assistant. But legally, the team still must operate under the brokerage’s license, still must be supervised by the Broker of Record.

In boots-on-the-ground terms, when a seller or buyer hires a team, they often believe they are hiring the team, not the brokerage, because, for all practical purposes, a team behaves like a mini-brokerage that is not allowed legally to be a brokerage.

Show Me The Money

When I’m paid as a real estate agent working under Keller Williams Coastal and Lakes & Mountains, I show up to the closing table, buyers and sellers sign a bunch of paperwork, house keys are given to the buyer, and the title agency slides me a check. My average commission is $10,000. The check, however, is made out to Keller Williams Coastal and Lakes & Mountains. I physically walk that check over to KWCLM offices and drop it into a small gray metal box. The check is then processed.

Agent Gross Commission: $10,000
Associate Royalty Fee: 6% = $600 (goes to Keller Williams)
Company Commission: 20% = $2,000 (goes to KWCLM, the franchise)
My Take: $7,400
Federal Taxes: 25% = $1,850
Net Income: $5,550

But if I’m on a team, the math changes:

Agent Gross Commission: $10,000
Associate Royalty Fee: 6% = $600 (goes to Keller Williams)
Company Commission: 20% = $2,000 (goes to KWCLM, the franchise)
Team Split: 50% = $3,700 (deductible business expense)
My Take: $3,700
Federal Taxes: 25% = $925
Net Income: $2,775

To be clear, Keller Williams proper, neither Keller Williams Coastal and Lakes & Mountains, nor the team, automatically withholds taxes for you.

Notice in the team scenario, as an agent, although other models exist, in the most common model, you share half your commission with the team. In return for fifty percent of your cash, a team should provide you with several benefits.

Leads are the biggest benefit. Or rather, at least should be. There are lead services you can subscribe to as an agent, but they’re literally taking anywhere from 30% to 45% of your commission anyway, plus they often charge you a monthly SaaS fee in the hundreds per month.

Second, good teams will provide transaction coordination, administrative support, listing prep, marketing assets, and customer relationship management discipline. All of that matters if you, as an agent loathes paperwork.

A team trades independence and margin for speed, structure, and proximity to deals. But if you are hiring a real estate team, you’ are still not hiring the team. You are hiring the brokerage the team works under.

The Groupies

Because teams distribute cash and provide a first-level compliance check on paperwork, they are not a group.

A real estate group is a marketing and affinity construct—not economic or legal. And, again, if you hire a group member, your real estate contract for services still sits with you and the brokerage.

The Dunk’s

The best way I’ve been able to describe any of this, which is not quite accurate, but the most easily understood, is that every single Realtor you engage with is like their own mini-Dunkin’ Donuts franchise. We have 11 Dunkin’ locations in Dover, NH. I personally like the 526 Central Ave location. My wife runs through the 181 Silver Street location. Neither shop is owned by the same person, but they all share the same name, the same branding, the same product. Each store pays fees to the corporate office, which leases its name and business systems.

In New Hampshire, we have two KW franchises: 1) Keller Williams Coastal and Lakes & Mountains (really, that’s the best one) and Keller Williams Realty Metropolitan. It’s been said that the job of any good brokerage is to enlist more Realtors, and the job of any good Realtor is to enlist more leads.

And leads? They aren’t really what you think they are, either, but we’ll get into that two weeks from now.

☕About This Real Estate 101 Series:

This full 10-part series pulls back the curtain on an industry most people never get to see clearly. Beginning with the low barrier to entry that brings so many agents into real estate, the pieces walk readers through how those agents are actually educated, supervised, and licensed to represent the largest financial decisions of someone’s life. From there, the arc traces the full anatomy of a transaction—what a Realtor truly does, how agency law works in the real world, and why so much of the job has less to do with houses and more to do with marketing and navigating human behavior. The series also explains how agents are paid, how production numbers get misused, and how to read a Realtor’s online presence with a critical eye. The final installment gives consumers a practical set of interview questions so they can choose representation based on skill, clarity, and trust rather than chance or convenience.

Next week: Agency Law for Real Humans, and coming up:

What a Realtor Actually Does in a Transaction
Why Most Real Estate Work Is Marketing
How Agents Get Paid (and Why It Matters)
The Myth of the “Top Producer”
How to Vet a Realtor Online
Interview Questions to Ask Before You Hire an Agent

About this publication.

Coffee with Steve is an independent publication by Steve Bargdill. Views are my own and do not represent Keller Williams Coastal & Lakes & Mountains Realty (“KWCLM”) or any other organization. Each Keller Williams Office is Independently Owned and Operated.

Not advice. Content is informational and educational; it is not legal, tax, or financial advice and does not guarantee results. Talk to a licensed professional who knows your situation before you act.

No agency created. Reading this does not create an agency relationship or agreement for services. Brokerage representation requires a separate written agreement with KWCLM.

Licensure. I am licensed in New Hampshire. Equal Housing Opportunity.

Wire-fraud warning. During representation by Keller Williams, you will never be asked via email to wire funds to anyone, including a title company. Do not follow email wiring instructions. Always verify by phone using a trusted number.

You can reach Keller Williams Coastal and Lakes & Mountains Realty at 603-610-8500 or Steve Bargdill directly at 603-617-6018.

Steve Bargdill | Realtor & Author | Dover • Portsmouth • Somersworth • Rochester • Seacoast NH | Licensed in NH as Stephen Bargdill Jr., with Keller Williams Coastal & Lakes & Mountains Realty.

Pronouns: he, they