Understanding the Opportunities and Challenges of FSBO Leads

INTRODUCTION

Working with FSBOs.

Many top-producing agents include For Sale by Owner (FSBO) leads in their prospecting portfolio. While FSBOs can be a potential source of lucrative revenue, agents must use a more nuanced approach when connecting with FSBO homeowners.

We’ve written extensively about For Sale by Owner Leads in this blog. In HOW TO GET FSBO LEADS, we discussed finding the most viable and profitable FSBO leads (starting, of course, with Espresso Agent’s industry-lead FSBO leads.).  In 14 FSBO OBJECTION SHUT-DOWNS, we did an in-depth review of the most common objections agents face from FSBOs, and how to handle those objections.

In today’s post, we will step back and look at FSBOs from a broader perspective. We’ll review the benefits of prospecting FSBOs. But we’ll also look at the challenges agents might face by lead-generating FSBOs. Finally, we will summarize common strategies to use when prospecting For Sale by Owner Leads.

FSBO LEADS

The benefits of prospecting FSBOs.

If you are new to the industry or have never worked with FSBO prospects, here are a few of the benefits worth considering:

• The FSBO market tends to be less competitive: Many agents ignore the value of working with FSBO leads, assuming that these homeowners are selling independently because they don’t want to pay commissions. Indeed, FSBOs usually cite commissions as their reason for going it alone. But if you realize that more than 90% of FSBOs eventually decide to seek the help of a real estate professional, you’ll want to make sure you are positioned to be that professional.
• FSBOs tend to be easier to work with. Here we will use expired listing leads as our frame of reference. Expireds can be frustrated, angry, and impatient after having failed to sell with their previous agent. This can be challenging for newer agents to handle. But FSBOs usually are more relaxed and open to talking to agents when they first put their house on the market. This provides the agent (especially if you’re newer to the industry) with the opportunity to practice your relationship-building skills.
• Building your value proposition. Because FSBOs are easier to work with, you can build rapport and trust with the homeowner. Take the opportunity to provide advice (if asked for) and even to help the FSBO homeowner with their paperwork and other administrative aspects of selling a home. The more help you provide, the more the FSBO will trust you, and the more they trust you, the more likely it is you’ll be near the top of their list when it comes time to listing with a professional.
• Practice handling objections. Check out the post referenced above about the 14 most common objections you’ll face working the FSBOs. The best practice you can get as an agent is to learn how to handle objections smoothly and confidently. And be clear: you will ALWAYS face objections. By projecting confidence as you address the FSBOs objections, you’ll prove to the homeowner that you have what it takes to guide them through the most important financial decisions in their lives.

FOR SALE BY OWNER LEADS

The challenges of prospecting FSBOs.

Working with For Sale By Owner (FSBO) prospects comes with its own challenges that agents must navigate carefully. Here are a few of the most common challenges.

• Skepticism and reluctance: The FSBO wants to save money on commissions, which could make them naturally skeptical about an agent’s value. As such, it becomes a challenge for the agent to build trust initially.
• Naivety about the real estate market: FSBOs may have an over-inflated idea of their home’s value, which could lead to overpricing. They may also believe their house (and their house alone) will sell quickly and at the highest price possible.
• A sense of being overwhelmed: Above we said that FSBOs are generally more receptive to talking to an agent. At the same time, it’s important to respect the fact that they may be feeling overwhelmed by the responsibility of selling & showing a home on their own. So, if you are TOO persistent in your outreach, you could alienate them before you have a chance to build trust.
• Emotional attachment: FSBOs may be overly attached to their home, which could result in them being overly protective or evasive when it comes to dealing with agents. And, of course, their emotional attachment might limit their ability to price their home or negotiate the best deal objectively.

PROSPECTING FSBO LEADS

A few proven strategies.

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?”

ESPRESSO AGENT’S FSBO EDGE

A comprehensive lead generation system to drive your success.

Many of the top-producing agents in the business rely on Espresso Agent’s advanced lead generation software. Here are a few reasons why:

1. We deliver unparalleled access to high-quality, competitive, motivated expired and FSBO leads.
2. We provide an industry-leading CRM with end-to-end functionality that keeps you on-task with your lead follow-up.
3. We are widely known to have the industry’s most comprehensive training and onboarding process.
4. We invite you into a community of like-minded agents who share real estate prospecting tips and celebrate your successes.

If you’d like to learn more about Espresso Agent and the value of our lead generation platform, please CONTACT US HERE.

Doug Spak

Doug Spak joined Espresso Agent as a Content Marketing Specialist in 2016. Doug brings nearly four decades of experience as a copywriter, blogger, and screenwriter to his role with Espresso. Since joining our team, Doug has actively updated website content, published more than 300 blogs, and created countless social media posts.