What Is a Real Estate Consultant and How Does It Differ from an Agent?

As an agent, you may have some clients who confuse you with a real estate consultant. This is understandable, considering agents and consultants have similar skills, responsibilities, and roles.

However, to establish yourself as an expert agent, it’s critical to understand the differences between agents and consultants and what consultants actually do. Read on to learn more.

What Does a Real Estate Consultant Do?

A real estate consultant gives expert advice to clients who are looking to buy, sell, invest in, or develop commercial or residential property.

Instead of working directly on transactions, consultants typically focus on offering advice. Clients often hire consultants to research a particular market, analyze the pros and cons of a specific real estate decision, or provide insight into an area’s supply and demand trends or local regulations.

Working as a consultant can also include:

Helping clients cut costs: Real estate consultants are expected to use their knowledge of the market to help clients achieve their goals while saving on expenses.

Ensuring legal compliance: It’s a consultant’s job to understand real estate compliance and advise their clients on how to approach their deal legally and strategically.

Building their network: Consultants work hard to strengthen connections with developers, buyers and sellers, and other potential clients. This also helps them keep track of what’s going on in their local market.

Does a real estate consultant need a license?

Most states don’t require real estate consultants to have a license, but many choose to obtain one. Not only does having a license expand a consultant’s education and potential service offerings, but it also enhances credibility with prospects and clients.

Real Estate Consultant vs. Real Estate Agent: What’s the Difference?

Real estate consultants and real estate agents have some overlapping responsibilities and skills, but their core services are different. The types of clients who typically work with consultants include:

• Companies working on development projects, which often involve purchasing land, figuring out complicated zoning laws, and finding high-quality yet cost-effective vendors.

• Investors trying to grow their real estate portfolios with valuable rental homes or fix-and-flips

• Businesses or corporations looking to buy or sell commercial property
• Individual buyers and sellers, usually for luxury properties, vacation homes, or investment assets

• Property managers and landlords who want to determine rental rates, refine their property management strategies, or increase tenant retention

• Government and public sector clients needing assistance with urban planning and infrastructure projects

In contrast, a real estate agent is a professional who guides buyers or sellers through the real estate process all the way to closing. In this way, they focus on completing transactions. Although there are exceptions, they generally work with residential properties and serve individual buyers and sellers.

Why Do These Differences Matter?

As an agent, understanding the differences between your role and a consultant’s can benefit you in several ways, including:

• Client referrals: Some of your clients may need more specialized financial or investment guidance. Referring them to a consultant can showcase your value in those cases.

• Clarifying expectations: Collaborating with a consultant on a project is much easier when you both understand each other’s respective roles and responsibilities.

• Enhancing credibility: Helping a client understand when to hire a consultant or answering their questions about role differences can help showcase your expertise in the industry.

Real-Life Examples of How to Work With a Real Estate Consultant as an Agent

There are various ways you might need to collaborate with a real estate consultant one day. Here are a few likely scenarios to prepare for:

1. Individual investments

An investor who wants to find a viable rental market may hire a consultant first. After choosing a specific market, they might work with a local real estate agent who understands the community to find potential properties and close the deal.

2. Mixed-use development

If a client is looking to invest in a property that combines residential and retail or office spaces, they might hire a consultant to research zoning laws and analyze the market and then hire an agent to look for suitable land and market the units once they’re ready.

3. Corporate relocations

Imagine a large company looking to relocate its headquarters to another city. A consultant could help them analyze cost implications, assess workforce needs, and look at the area’s proximity to transportation. An agent could then use that research to find an ideal building.

4. Community development

Let’s say a city wants to revitalize a neighborhood with a large-scale development. They may get a consultant to advise them on project planning and an agent to sell or rent out those newly built spaces.

There are many more ways agents and consultants can collaborate to serve clients. Consider connecting with consultants in your local area to expand your network and perhaps get more client referrals.