Real Estate Ethics: What to Do When Your Buyer is Doing What You Wouldn’t
As a real estate agent, you can sometimes feel torn between wanting to meet your buyer’s best interests and your own. With all the knowledge that you have about the industry, it’s hard to determine how much you should share with your clients and when you need to bite your tongue and let the chips fall where they may. Many agents also work as investors on the side, and can tell right away when a home is a good deal or not. But, sharing too much of this information can hurt you in the long run, if your buyer decides not to go through with the transaction based on what you’ve shared with them.
So, if you know wholeheartedly that your buyer is making a bad decision, what can you do? How do you do the right thing without hurting them and yourself?
Why are they coming to you?
What is the background of your buyers and what is it that they are coming to you for help with? A client that’s coming to buy their first single-family home is naturally going to be treated a lot differently than a client who has already three investment properties under their belt. Asking your new clients to fill out a short questionnaire upon the first meeting will help you gauge your interaction for the remainder of your time with them.
Find out what they know, first
Your job requires you to answer questions and address concerns that your buyers may have. But, before you jump right into sharing everything you know, see what they know about the process and real estate overall, first. Of course, don’t belittle them or make assumptions; some of these clients have really done their research before calling you. But, the more they speak, the less of a chance you have from deterring them, or starting a debate that could potentially put your relationship with this client – and, ultimately your finances – in jeopardy.
Consider the consequences
There are many different types of theoretical “bad” decisions when it comes to real estate. And, as agents, we are hyper-aware of all them. Every time you go to a showing with one of your clients, there’s a little voice in your head telling you what you would or wouldn’t do in the same situation. Perhaps the house is way overpriced, the neighborhood has a lot of problems, or there aren’t other people interested in buying the property, so your buyers don’t need to put in an offer over asking price.
If you’re not sure whether or not to let them in on your advice, a good general rule is: Did they ask for it? If the consequences of the decision they are about to make isn’t going to hurt them despite maybe causing some minor inconveniences down the road, then there’s no need for you to say anything. But, remember – if you put your clients in a troublesome situation because you were not as forthcoming about something that you should have been forthcoming about, then that could end up reflecting poorly on you in just a few months.
They’re your client, not your friend
As adults, it’s really easy to click with people that are on the same wavelength as us. And, as it’s part of a real estate agent’s job is to be good with people, you’ll probably click with most of your clients right off the bat. But, this is business. Even if you think your clients are super cool and that you’d love to hang out with them outside of work, that’s great and all. Yet, it will make it that much harder for you not to want to share all your insights with them thereby breaking the boundaries of professionalism. The only one who will end up suffering from that is you.
Still, trust and transparency are important
At the end of the day, your clients are choosing you because they feel that they can trust you. Therefore, you want your clients to make the right decision, and one that they will be happy with. But, too many times, we have buyers coming in that are way too emotional in their investment, and can’t look past trivial issues with a house or cannot conceive looking into other options once they’ve seen their dream home.
Your job is to best advise your client so that a deal can be closed and you can collect your commission. Along the way, though, you can listen to that little voice in your head that’s saying “What would I have wanted my real estate agent to tell me?”
Part of that trust comes from honesty and only experience will teach you what needs to be shared and what can be kept to yourself.
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