When someone comes to me for help buying an apartment building, the first thing that happens is we have a phone conversation.
During the talk, I give an overview of our process, then spend a bunch of time asking questions of the potential client, including: how much capital she has to deploy, what size deal she wants to do, what her return requirements are, which areas she likes, etc.
Based on the above information, I need to decide:
1. Whether it makes sense for us to work together at all. All we brokers have to sell is our time. On the buy-side, which is mostly where we work, there is absolutely no guarantee that any particular client is going to do a deal where we get paid. So, to make sure we have a functional business, we need to screen potential clients to ensure they are serious, have the necessary financial resources, and have reasonable return requirements. If yes, great; if no, we’ll very politely decline the work.
2. Which agent she should work with. This one is tricky. Obviously, target deal size and area play a very big part. But, ultimately, getting a deal done is about the agent and client working together as a team. Therefore, I try to balance the more objective factors with a big subjective one, too: Would these people get along?
I wish I had a great system to going back and checking on the decisions I have made about whether to work with clients and to whom to refer them. But I don’t.
With respect to the question of whether the prospective clients are worth the time the agents need to invest, all I can say is that the agents are making a living and continue to happily service the clients.
With respect to the question of whether I’m doing a good job matching agents with clients: We’ve had tons of repeat business. So I can’t be screwing it up too too badly.