A FSBO Refresher

For Sale by Owner listings continue to be an excellent source of revenue for agents.

Today we’ll take a look at FSBO strategy from two angles. First, how experienced agents look at FSBOs. And second, how new agents should approach FSBOs.

EXPERIENCED AGENTS AND FSBOs

Experienced pros understand that FSBOs are motivated to sell, yet require a subtle approach in order to become a listing client. Here are a few tips from long-time agents:

• Persistence pays. FSBOs often get frustrated quickly when trying to go it alone. To that end, it’s important to stay in touch in order to keep your name top-of-mind with them.
• Be a diligent notetaker. Solid notes during your initial prospecting call can yield the kind of relevant questions that keeps the FSBO prospect engaged. For example, you might find out your FSBO prospect is having an open-house that weekend. If so, you’ll know to follow up Monday morning to ask how the open house went.
• Validate their approach.  Build trust with FSBOs by affirming their decision: “Great idea to sell on your I think you’ll have a lot of success. And if you need any help, let me know.” To a certain degree, FSBOs need decide on their own if selling their own home makes sense. Which puts you in an excellent position to get the listing when that decision is finally made.
• Guide, don’t force. Use open-ended questions to uncover the homeowner’s motivation. If the FSBO says “I’m going this to save money,” you might respond with: “That makes total sense, but let me ask, what does saving money look like to you?”

NEWER AGENTS

If you’re a newer agent and haven’t actively prospected, the good news is that FSBOs, in general, are easier to engage than someone sitting on an expired listing. Expireds are often frustrated and angry, especially when you consider that they’re likely getting hounded by countless real estate agents, each of whom has the “best strategy” for selling the home.

FSBOs, on the other hand, tend to be more relaxed and open to having a dialogue with you.

Here are a few things to consider if you’re beginning to prospect FSBOs:

• Hard-selling can be off-putting: You need to be persistent in your follow-up. But, an overly-aggressive approach might suggest to the homeowner that they made the wrong decision by selling on their own.
• Minimize your eagerness. Newer agents can often by over-eager, assuming that it might be easier to get a listing from a “friendlier, more accessible” FSBO. But that attitude can backfire. Take it slow and steady.
• Understand that value is important in building rapport: Use your initial conversations to build rapport and trust. Discuss strategies such as the importance of curb appeal. Perhaps you can suggest landscapers you know who can help them transform their front yard. By supporting their efforts to sell in the short-term, they’re more likely to remember you when they’ve “hit the wall” on their own selling efforts.
• Hone your listening skills. Don’t talk too much when you make that first contact. Your instinct might be to do as much “selling” as possible. Instead, ask open-ended questions. Then, listen carefully to uncover the FSBOs motivations and fears. A great rule-of-thumb is to allow your FSBO prospect to about 70% of the talking in that first conversation.

Remember, about 90% of FSBOs go it alone to save on real estate commission. Build trust by affirming their decision. “I have no doubt that you can sell on your own.”  Allow them time to see what it’s like to sell on their own. When the time is right, you can ask: “If there would be a financial benefit to working with me, wouldn’t you at least want to hear what I had to say?” 

It takes FSBOs about a month to appreciate how time-consuming it is to sell their own home. With a patient, value-added approach, you can set yourself up to be the “go-to agent” when the prospect finally says: “I’m ready to pay you a commission!”