When is it ok to let a real estate client go?

Realtors tend to invest a lot of time and energy into finding and keeping their clients. It’s a competitive industry and you rely on good client relations and a healthy pipeline to keep you going. But what happens if, for any reason, the relationship with the client is just not working out?

There is a ton of information out there for real estate clients, advising them when it is time to drop their agent, but sometimes it goes the other way around too.

In fact, sometimes letting the client go is actually the best solution for everyone.

You may be worried about protecting your business or ensuring that you have something else to fall back on, but there are times when letting the client go could potentially put you in a better position.

So, when is it ok to let a real estate client go?

Dishonesty

Dishonesty covers a broad spectrum of possible issues and unfortunately, by its very nature it is not always apparent to the agent. If you get a sniff of dishonest activity on your client’s behalf though, you need to be thinking about your own reputation, morals and possible liability.

Whether the client’s behavior is outright illegal or just ethically questionable, no client is worth potentially ruining your career, losing your license or even ending up in jail.

For example, there have been many cases of sellers who fail to disclose known issues with the property they are selling. If you get wind of this then your first action should always be to let them know they are required to disclose such information or possibly end up in court after a sale. If they still don’t want to conform, it’s time to walk. You do not want to be tied up with their liability, or known to have helped broker a dishonest deal.

Image source: Freshbooks

Excessive Rudeness

As an agency, you deal with people, which means learning to deal with all sorts. This does include having to deal with more “difficult” personality types too, but there is a fine line between “quirky” and just plain rude.

If your client is continuously disrespectful, abusive or generally difficult to deal with, especially if it’s getting to the point where it affects your other work or you dread taking their phone calls, then it’s probably time to say adios.

Adjacent to overall rudeness, you do not need to (and should not) tolerate any kind of behavior that infringes on your rights or the rights of others. This could include racism, sexism or any kind of talk that you find offensive. This is another thing that often comes down to perception, but if someone will not cease offensive talk when requested, you don’t need to hang onto them.

Time Wasters

“Time wasting” is going to be a matter of individual perspective, but it’s always good to define what your time is worth and what you find acceptable in terms of time spent on the client. Of course every client deserves your time, but how much is too much?

Ken DeLeon of Silicon Valley firm DeLeon Realty suggests that those who stubbornly insist on overpricing despite your advice may be considered as time wasters.

“What a seller is telling you when he wants to overprice a listing is, ‘I’m going to demand that you spend 100-plus hours working on marketing the home, you’ll spend a huge amount of money, the house won’t sell, and I’ll badmouth you all over town.” DeLeon advises agents to be selective “and don’t be afraid to turn down a listing.”

On the other hand, what of buyers? If you’ve spent months showing them dozens of homes that should meet the specifications they’ve given you, yet they still won’t pick, you may decide this constitutes enough “time wasting” too.

The other variety is the “time sucker,” the one who expects that you work on their deals 24/7 with complete disregard for any other client. While every client should get sufficient amounts of your attention, there is only so much you can devote to any one client before others suffer. If, according to your own standards, a client is demanding more time than is reasonable and will not let up after a conversation, it may be time to let them go.

[tweetthis]Time wasters and time suckers are two types of real estate clients you probably want to “fire”.[/tweetthis]

Exclusive Or Not?

This is another one of those things that is going to come down to the personal preference of the agent. You may be perfectly happy for clients to be “seeing other agents,” but others only want to sign on if the relationship is exclusive.

If clients are seeing multiple agents, it becomes a problem when there is no real commitment from the client to getting the job done and they are simply wanting a wider range of people at their bidding. The commitment-phobe can also be a time waster or time sucker, bouncing around different agencies with nothing really being achieved.

Again, you’re going to have to assess based on what you prefer, but perhaps your time is better spent with committed clients who are happy to get the job done with you.

Know That It’s OK…

A major roadblock for agents in firing clients is the worry over whether it’s the right thing to do. Will it end up costing a decent commission? Will it impact your reputation?

The thing is, not every client will be a good fit and that is ok. It’s the same for any other relationship in life. However, if you choose to hang for too long to clients who are not a good fit, it tends to make a toxic impact on your or your agency as a whole.

You’ve probably struck the client who no one wants to serve or who strikes fear throughout your business. Keeping them around tends to breed nothing but resentment and a lack of motivation for the job. On the other hand, if you can show your team that you’re not afraid to “fire” a client who is a poor fit, you prove to them that you have their interests at heart and that it’s not just about the money for you. This tends to provide a morale boost and loyalty toward your business.

As for reputation, there is a chance that a client may be angry enough to give a poor review, but that does not spell the end for your business. On the whole, if you are spending more of your time providing great service to customers who are a good fit, you should be attracting enough positive reviews that a bad one can be seen as an anomaly.

What’s more important? A check in the short term? Or more good will in the longer term, a happier team and clients who are better served?

Final Thoughts

It’s never easy to decide to let a client go, especially if it’s not something you’ve done a lot of before. However, it does become easier the more rooted you are in what you determine to be acceptable or not.

Sometimes it’s not only about protecting your own reputation, but the sanity of yourself and your team as well as the relationships you have with other clients. A client who is a poor fit can do more damage than what their possible commission check is worth.

So have clear standards and stick to them. It’s ok to let a client go, but not to let one stick around to the detriment of your business.

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