Cost per lead (CPL) is what you pay to get someone to fill out a form or call in. It tells you nothing about what happens after that. A CPL of $40 can look great while every single lead goes nowhere, and a CPL of $200 can be perfectly fine if a meaningful share of those leads close into deals. What you are describing, tracking the front end and not the back end, is genuinely the most common blind spot in real estate paid advertising.
The number that actually matters is cost per acquisition, sometimes called CPA. That is the total ad spend divided by the number of deals that actually closed. If you spent $4,000 last month and closed two deals, your CPA is $2,000 per deal. Whether that is good or bad depends entirely on the profit per deal, not on what the CPL said.
The thing worth raising with your agency is whether they are tracking lead disposition at all. Some agencies do, some do not, and the ones who do not have a structural incentive to optimize for cheap leads rather than profitable ones. Cheap and unconvertible is worse than expensive and convertible. I would ask them specifically what percentage of paid leads from the last six months made it past the first conversation, and what their process is for feeding that outcome data back into campaign targeting.
Your agency's job, as the strategy guide for this type of service describes it, is to deliver measurable return on ad spend, not just a CPL number. If they cannot show you a path from lead to closed deal, that is a reasonable thing to push on.
I want to be clear that I cannot tell you whether your numbers are salvageable or whether the agency relationship is worth continuing. That depends on your deal margins and your follow-up process, among other things.
What does your follow-up process look like once a lead comes in? That changes the diagnosis considerably.
