Discover proven strategies on how to get FSBO leads effectively. Learn expert tips to convert FSBO sellers into clients and grow your real estate business.
According to the National Association of Realtors (NAR), homes sold through a licensed real estate agent fetch, on average, $100,000 more than for-sale-be-owner (FSBO) homes.
Given this disparity, one would think that homeowners who need to sell would jump at the chance to work with an agent. But many homeowners still believe that they have what it takes to sell their own homes and, in the process, pocket the commission they would normally pay the agent.
It is worth noting that 7-8% of homes sold every year are owner-managed transactions, according to NAR. But in the vast majority of these FSBO sales, the homeowner had a buyer in hand through personal connections.
However, nearly 90% of FSBOs eventually turn to an agent after going it alone for a few weeks. They realize that simply putting a sign in front of their yard does not yield the kind of traffic they can expect by leveraging an agent’s marketing expertise and contact network.
In this post, we’ll review how to find FSBO leads and how to convert FSBO leads into listings. Importantly, as we’ll discuss, prospecting FSBOs requires patience and a nuanced approach. You need to respect their decision to go it alone while, at the same time, building rapport so that you’re the agent they call when they realize it’s time to work with a pro.
One final point to remember: the NAR estimates that of those FSBOs who decide to work with an agent, about 70% will work with the first agent who contacts them.
In this section, we’ll break down two approaches to finding FSBO leads:
Espresso Agent offers cutting-edge lead generation software, providing access to the most accurate and reliable FSBO leads. With Espresso Agent, you gain the best FSBO leads daily and get the insights and tools to understand and meet the needs of those aiming to sell on their own.
Some agents, especially those who are newer to the industry, might be uncomfortable with phone prospecting to generate listings. For these agents, the question of how to get FSBO leads often leads to a variety of outreach and passive marketing strategies:
Many agents prefer prospecting FSBOs because it is much less competitive than calling newly expired listings. Expireds tend to have a greater sense of urgency to sell and a higher degree of frustration for not having sold during their initial listing. FSBOs typically do not have the same level of urgency as Expireds, which means you need to be patient and nuanced as you approach these homeowners.
When prospecting FSBOs, here are four tips that can help with engagement and building rapport:
The first and most important step to improve your FSBO lead conversion rate is connecting with and engaging your potential clients. And connecting with leads means active prospecting or working the phones. Here are a few tips to consider regarding real estate prospecting:
Improving your FSBO conversion rate starts with building rapport and projecting confidence, especially in the initial prospecting phase of the sales journey.
As we discuss in detail in our blog post MASTERING YOUR REAL ESTATE SCRIPTS, many agents avoid scripts for fear of sounding too robotic or inauthentic. These are valid concerns that can be easily remedied by embracing and internalizing scripts.
Of all the benefits you can realize by working with scripts, two stand out above all the others:
Any high-producing real estate professional is dogged about lead follow-up as an essential element to improving their real estate lead conversion rate.
It’s staggering to consider how much business is left on the table due to poor (or no) lead follow-up. More than half of all real estate agents don’t even follow up with prospects after an initial call. That might explain why top-producing agents derive as much as 80% of their listings opportunities (conversions) from persistent lead follow-up.
If you think you’ve been a little lax in your follow-up, now is the time to refocus your efforts. To that end:
Here are questions you can use to guide your initial calls with a FSBO:
“If I were to bring you a buyer, would you be open to paying a commission?”
Typically, we try to avoid simple yes/no questions, but this is an exception. The prospect will likely answer “yes,” which opens the door to your follow-up: “Can I come by to see your property?” Even if the homeowner says no, stick with it a little longer, reinforcing the point that the more you know about their property, the easier it will be for you to identify the perfect buyer.
“What do you plan to do after you sell your home?”
By going down this path, you begin to build rapport by engaging the prospect in a discussion of their ultimate goals and dreams.
“While I fully expect you to sell your home, if you’ve not had success after, say, four weeks, would you be open to interviewing a real estate professional?”
This question affirms the homeowner’s belief that they should be able to sell on their own. But it also sets up the more likely reality that selling might not be as easy as they think. And subtly reminds them that you are the real estate professional they might consider when the time comes.
“What do you think is the key advantage to selling on your own?”
Most likely, they will reiterate the importance of making more money by saving on commission. Acknowledge their decision: “Yes, I clearly understand, because it’s a lot of money.” You’ll want to remind them that they will still have to pay the buyer’s agent a commission, which could be as much as 3%. Also, keep the conversation active by asking: “How will the buyer benefit by working directly with you?” This question forces the FSBO prospect to think about factors they may not have considered, such as the fact that buyers have many more options and, thus, more leverage.
“Would you be open to having me come to see your home next week?”
Even though you may have touched on this earlier in your conversation, it’s important to reinforce some of the ways in which seeing their property could bring them value:
“Tell me what you see as the key differences between your next home and your current home?”
This is a simple conversation-extender, to keep your prospect engaged, and give you opportunities to learn more about their needs. For example: “What’s important about a bigger back yard?”
“If I could show you how you could net an extra five thousand dollars, would you be open to hiring me as your agent?”
Once you’ve established rapport, and hopefully some trust, with your FSBO prospect, you might have an opening to make the hard sell. Again, this hard sell might not work early in the FSBO process, but it plants a vital seed that will hopefully blossom once the homeowner has experienced weeks of futility in their efforts to sell.
As we said at the outset of this post, 9 out of 10 FSBOs will eventually decide to work with an agent after failing to sell on their own. Your job is to ensure you are the agent they choose when the time comes.
Therefore, it is critical that you use the guide above to build rapport with and gain the trust of the FSBO homeowner. You can also check out these posts for additional tips:
If you’d like to learn more about Espresso Agent’s industry-leading lead generation system, CONTACT US HERE.
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