Inside the Mind of an FSBO
Whether you’re relatively new to real estate sales or have been in the business a long time, if you are NOT mining the rich vein known as For Sale by Owner Leads (FSBO), you’re missing an extraordinary opportunity to drive revenue.
In this post, we’ll look at some of the keys to effectively engaging FSBOs in that initial call.
Seasoned agents know that FSBOs represent “low hanging fruit,” primarily because one can assume they are motivated to sell. At the same time, they know that working with FSBOs requires patience and a much more nuanced approach that would be required when working with, for example, new expired prospects. Veterans understand that:
- Persistent follow-up is critical because it doesn’t take too long for FSBOs to become disenchanted and frustrated with the process of selling their own home.
- Taking notes that lead to relevant questions is important. For example, making a note to call a FSBO on the Monday following an open house: “How’d your open house go?”
- Affirming a FSBO’s decision to sell on their own builds trust. They want to feel as if they’ve made the right decision, until they come to the moment when they realize they’re in over their heads and need help.
- They can’t force the process or be pushy in “educating” the FSBO. Pros know how to ask the right, open-ended questions that help uncover the homeowner’s motivation. When the FSBO says “I’m going this to save money,” your response might be: “That makes total sense, but let me ask you, what does saving money look like to you?”
For someone relatively new to real estate sales, FSBOs are much easier to talk to, than, say, a new Expired. New expireds are often discouraged, frustrated and possibly angry. They’ll be taking lots of calls from aggressive agents, which might exacerbate their frustration. If you don’t have a lot of experience dealing with objections, new expireds can be challenging. FSBOs, on the other hand, are comfortable that they’re going to save lots of money by selling. They tend to be friendlier and open to dialogue because they have not yet become frustrated by their experience. A couple of pointers for newer agents:
- Be persistent in calling and following up, but know that you should not be selling. If you’re “selling” you are, in effect, saying that you think they’ve made the wrong decision by selling on their own.
- Try not to fall into the trap many newer agents often fall into, and that’s the trap of being overly eager. Because FSBOs tend to be easier to talk to, it’s easy to assume they might be easier to get a listing from. But that’s usually not the case. You need to learn patience.
- Learn how to provide something of value. For example, if you know a good landscaper, you might offer that information by reminding the prospect of the importance of curb appeal in selling a home. Adding value helps build trust.
- Stop talking! It’s easy to get on a roll, often because you are so excited to have someone answer your call that you want to take advantage of the time and do as much “selling” as possible. Learn how to ask open-ended questions and then sit back and listen. Careful listening is a great way to uncover a seller’s fears and motivations
So, whether you’re a successful veteran agent or new to the business, here are a few observations and tips to help you maximize your opportunity with FSBOs:
- Put yourself in their head: surveys show that 60% of homeowners respond that they don’t trust real estate agents. Understand that you are starting any conversation with a FSBO from a position of weakness, when it comes to trust and confidence.
- 9% of FSBOs are selling on their desire to save on the commission. You need to affirm that decision as a first step toward building trust. “I have no doubt that you can sell on your own.” You don’t want to come out of the gate telling them how you can save them money. Build the relationship and give them time to see what it’s like to sell on their own. When the time is right, you might ask a question like: “If I could help you sell your home and make more money, would you be open to that?” Or: “If there would be a financial benefit to working with me, wouldn’t you at least want to hear what I had to say?”
- Learn how to incorporate the word “we” into your conversation to suggest that are you both in this together. “When we sell your home, do you have somewhere you want to move?” Or: “When we meet today, if you feel comfortable that working with me is the best financial decision you can make, would you consider hiring me?”
- Two basics of communication are critical when working with FSBOs. First, always be aware of your tonality. You want to sound empathetic, enthusiastic and positive. You never want to sound as if you’re lecturing someone. Second, people want to know that they are heard. Learn how to mirror back what they’ve said, so they know they’ve been heard.
- Always try to add value when building a relationship with a FSBO, even if it doesn’t’ lead to a listing this go-around. How can you add value?
- Offer to help guide them through the paperwork
- Suggest lenders, home inspectors, etc.
- Advise then as to how to work with a seller’s disclosure form.
- Ideas on how to stage their home
- Ideas on how to improve their curb appeal
It doesn’t take long for FSBOs to realize how difficult and time-consuming it is to sell their own home. If you practice patience and learn how to be a valuable resource, you set yourself up to be the “go-to agent” when the FSBO throws up their hands and says: “Now that I think about it, paying a real estate commission doesn’t sound like such a bad idea.”