FSBOs are homeowners who sell their homes without the help of a real estate agent. Despite the multiple benefits of working with an agent, many home sellers attempt to sell their property independently to save money on commission. Prospecting FSBOs can be a profitable way to grow your real estate business. Here are some tips to do it like a pro.
Ask for Referrals
FSBOs represent an underserved market, and once you connect with them, they can be raving fans. But before you reach out, create an authentic profile that demonstrates your expertise and connects with them emotionally. This will help you build trust, overcome their fear of working with agents, and convert them into new clients.
During your first call with an FSBO, acknowledge that they’ve likely researched the home selling process and may feel confident in listing their home themselves. However, it’s important to respect their independent spirit and avoid talking down to them or correcting their knowledge, which can come off as condescending.
Instead, make a point of being an information resource for FSBOs by offering your advice and support for free. Offer to send them a marketing package that includes a sample offer contract, local disclosure forms, a mortgage pre-approval letter, and more. This way, they’ll remember you as someone who goes above and beyond to assist them with selling their home and not just another salesperson.
Inspect the Home
Inspecting the home is a big step in prospecting for FSBO listings. It allows you to meet and greet the homeowner and show them you’re a serious buyer. It also helps you discover what’s in disrepair, whether major structural issues or minor ones like mildew or faulty blinds. If you discover something too costly to fix, you can ask the seller to lower the sale price or cancel the sale altogether.
You can also use your inspection to demonstrate why you’re a better choice to sell the property than the owner is. For example, you could include a pre-listing service package in your presentation with information about local market conditions, staging techniques, and marketing strategies. Keeping the FSBO updated with new listings, sales pending and sold, and neighborhood home values is another way to impress them.
Ask Questions
When contacting FSBO leads, it’s important to ask questions to identify their goals and determine how you can help them achieve those goals. Whether they are selling their home or looking to purchase a new property, asking the right questions can help you stay on track for your qualifying interview appointment. One of the best ways to convert FSBOs into listings is by showing them your value. That can be done by explaining how your services will improve their listing and sale process and how you will ensure they sell for the highest price in the shortest amount of time. To confidently reach FSBOs, consider getting a dedicated business phone number to separate your professional and personal contacts. Using a call recording tool like RingCentral can also help you practice and hone your FSBO prospecting skills without risking making a mistake in an actual conversation.
Don’t Take the Owner’s Words
Homeowners selling on their own often believe they can save significant money by skipping the real estate commission. They need to be corrected. According to industry research, sellers who work with agents earn a higher profit, even after accounting for the agent’s marketing strategy, local expertise, and networking connections. A top-rated local agent can also provide insights and data to help homeowners pinpoint a fair market value for their property, ensuring they don’t over-price or miss out on a sale. So, if the FSBO seller isn’t ready to concede that they need your services, gently encourage them.
Use a high-quality FSBO lead service like Vulcan7 to discover the contact information of owners who have recently listed their homes or are trying to sell their properties without the assistance of an agent. Then, they write prospecting letters that focus on boosting their egos and introducing doubt about their decision. From there, build trust and rapport by suggesting real estate-related vendors they might benefit from working within the short term. And then, when the time is right, offer your services.
Make the Offer
When approaching FSBOs, you need to offer them something valuable. Whether that’s a marketing package or your expertise in negotiating, inspection reports, mortgage approval letters, staging and holding open houses, or even just advice on how to price their home, you need to provide value. This will help lower their resistance to hiring a real estate agent and increase the likelihood that they choose you to sell their home.
Check newspaper listings and yard signage for potential FSBO prospects. You’ll likely need to contact them 3 – 5 times before you win their business. Remember, sales is not about selling your services – it’s about being of service and finding solutions that meet their needs. While some agents may consider cold calling a “dirty word,” it is a highly effective lead-generation strategy. Utilize a power dialer to reduce prospecting time while increasing conversion rates. A power dialer calls through a list of contact numbers until you get someone on the phone. This frees up your time to focus on other aspects of your real estate business.