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Turning FSBO's Into Clients

By
Real Estate Agent with Principle Broker / Owner

Now that "unrepresented" sellers are jumping on the sell-it-yourself bandwagon, just what are you doing to get their business?  Just as "location - location - location" is the by word of Realtors, then "educate - educate - educate" should be applied to getting the business of FSBO's.

So, what are the tools you use to influence unrepresented sellers to enlist you as their REALTOR?  The key is in how you present yourself and all that you can DO FOR THEM as their REALTOR to market and sell their home, either quickly or for top dollar...hopefully both!

Educating the unrepresented seller includes laying out all the RISKS they will bear - solely by themselves - continuing down the maze and often confusing path of selling property without a PROFESSIONAL REALTOR.  Most sellers haven't a clue about required DISCLOSURES and how they apply to them, especially if they sell their own property themself.  Typically they do not know about PROPERTY MARKERS or EASEMENTS or PROFESSIONAL INSPECTIONS, let alone CONTRACTS/SALE AGREEMENTS.  And, most are out in left field when it comes to EFFECTIVELY MARKETING their property.  How many times have you seen a FOR SALE BY OWNER yard sign with no FLYER BOX or if they have one their flyer box is EMPTY, or you can't read their hand-lettered phone number?

Are unrepresented sellers savvy to all the various marketing strategies to getting their property advertised at many venues (e.g., yard signs, flyers, newspaper Ads, Open House, cable TV ads, web site exposure, NAR's Realtor.org, local Realtor Associate public web site, et al)?

Are unrepresented sellers aware of how much time it takes to PREPARE their home to effectively stage it to show to prospective buyers?  And, aree they aware that most agents do not show FSBO properties because they know the seller will refuse to pay their commission if they bring the buyer ... and God forbid getting a commission out of the Buyer!  Don't forget that buyers think agents work for FREE!  (That irrational concept is OUR fault for not telling them in advance at first point of contact.)

When you approach a "hard sell" unrepresented seller on your services, have you taken the time to prepare an exhaustive list of all the various services you will perform for them and apply a hourly rate to each service?  It typically costs a Realtor about $3,500 in their time in performing the standard functional services throughout a complete handling of a transaction (this amount is dependent on how much you value your time).

Even after you've made your full sales pitch to get the unrepresented seller's listing, they still refuse, then by all means offer them your professional "guidance" on a CONSULTING FEE basis by the hour.  You'll likely find that after 3 to 8 weeks they've become so frustrated they'll either call you to list their property for them at full representation or they'll withdraw their property from the market altogether.  Either way you WIN!

What say you?

Show All Comments Sort:
Susan Trombley
Trombley Real Estate - Wake Forest, NC
Broker/Realtor, Raleigh, Cary, Wake Forest, Youngs

Bob,

Well put. They would not goto their 40 hr week job without being paid for their service, why should be. Why should we do it for less when we will be the ones doing all the work and paying for the advertising.

Thanks for all the reminders.

 

Oct 11, 2006 04:52 AM
Eddy Martinez
Nationwide Funding Group - Highland Park, CA
Well said. You sure know what you are doing. Have you heard of  a company called "Help-U-Sell" ?
Oct 11, 2006 04:56 AM
Bob Cooper
Principle Broker / Owner - Bend, OR
Eddy Matinez - Yes, I'm familiar with Help-U-Sell.  Thanks for your comment.
Oct 11, 2006 05:28 AM
Bob Cooper
Principle Broker / Owner - Bend, OR

Susan Trombley - You hit the nail on the head with your observation that Buyers would not perform their work for free.  Example:  I had a doctor neophyte investor and he wanted me to help him buy a FSBO property where the seller refused to pay my commission.  He expected me to work for free until I casually posed this question to him, "Doctor, do you provide free medical services to your patients?"  He quickly replied with "NO!", so I said, "Then why would you think I'd work for free?"  He ultimately agreed to pay my commission if the seller would not!

 I'm a former senior management consultant with a global Fortune 500 firm and my billable rate was likely more per hour than a physician.  I don't work for free, nor do I sacrifice my personal integrity.  Every Realtor should employ the same work ethic.

Oct 11, 2006 05:33 AM
Todd Murphy
Fitts Agency - Tuscaloosa, AL

I'm in the process now of writing copy that motivates a FSBO to convert to using a professional agent.  If anyone out there knows of some great material, I sure would be interested.

Oct 11, 2006 05:42 AM
Leo Namiot - LeoLends.com
Canopy Mortgage - Leo Namiot - Saint Augustine, FL
More than just great rates
This is an untapped market, the key to conversion is calling them weekly or touching them once a week with a mailing, once they learn how hard it is to sell FSBO they will finally give up and if you stay in front of them the whole way then you will be the agent they call when they throw in the towel
Oct 11, 2006 06:06 AM
Home Design
Alpharetta, GA
Home Design and Real Estate

Early in my career I had great luck with FSBOs.  Now I stay away from them.  They are definatly a niche for some agents!

Roswell Real Estate

Oct 11, 2006 06:12 AM
Jeff Dowler, CRS
eXp Realty of California, Inc. - Carlsbad, CA
The Southern California Relocation Dude
Thanks for the great information. I personally have not pursued FSBOs very much because it slwassy seems like an uphill battle. Part of that reluctance, I'm sure, is not having the tools and strategy. The information here is very useful and I hope we will hear more from folks who are successful at getting unrepresented sellers to list, so that others can do the same - provided it makes sense. Given themarket I'm not sure it is the right group to chase after, at least for me personally.
Oct 11, 2006 07:01 AM
Eddy Martinez
Nationwide Funding Group - Highland Park, CA
Mr.Cooper what exactly does Help U Sell do for a customer? I have seen their signs up in front of some houses in my neighborhood.
Oct 11, 2006 08:10 AM
Suzanne Marriott
Keller Williams Arizona Realty - Anthem, AZ
Associate Broker, CLHMS, e-PRO
Depends what frame of mind my husband is in!  Sometimes he's in the mood to go out doorknocking FSBOs that are on the Do-Not-Call list, and will take 3 in a weekend.  Wish he would feel that way more often!
Oct 11, 2006 08:33 AM
Carol Williams
Although I'm retired, I love sharing my knowledge and learning from other real estate industry professionals. - Wenatchee, WA
Retired Agent / Broker / Prop. Mgr, Wenatchee, WA

Hi Bob,
Thanks for the pointers.  FSBOs can definitely be cultivated, but patience is a virtue.  Ongoing contact is a key.  You're not going to get them all but, overall, a consistent FSBO program can be lucrative. 

Oct 11, 2006 08:57 AM
Jacqueline McCroy Elbert
RE/MAX Realty Suburban - Overland Park, KS
 Todd, you wrote "If anyone out there knows of some great material, I sure would be interested" ...so would others.  So, if someone does have some great material, please post it.  Thanx! 
Oct 11, 2006 09:56 AM
ASHEVILLE REALTY REFERRAL RESOURCE 828-776-0779
REAL ESTATE REFERRAL NETWORK - Asheville, NC
CONTACT janeAnne365@gmail.com

HI Bob,

We enjoy a strong FSBO attraction becasue we do as you suggest...establish and maintain a relationship.

Oct 11, 2006 11:09 AM
Jay and Linnea Hanley
PrudentialFloridaRealty - Jupiter, FL

We have sold homes for FSBO's and they liked us. So, we listed their next property.

Jay and Linnea Hanley

Oct 11, 2006 12:22 PM
Rob Wills
Gilpin Realty Inc. - Everett, WA
All I know is FSBOs here are very frustaing.
Oct 11, 2006 01:54 PM
Bob Cooper
Principle Broker / Owner - Bend, OR

To those asking for additional information and "helps" in achieving success with turning FSBOs into listings, send me an email and I'll provide a tool I use.

Please be patient because I'm away from my office for two weeks but will return after Oct. 25th.

Bob

Oct 11, 2006 03:06 PM
Steven Holcomb
Keller Williams Realty - Plano, TX
Esq. - BBA, JD, GRI
One method that seems to work is when I give a FSBO a brief summary of legal cases where a buyer takes advantage of an unrepresented seller.  I also provide them with all the public forms and contracts made available by the state and then ask them to call if they find a provision they do not understand.
Oct 11, 2006 04:03 PM
Christine Adler
FindAHomeWithMe.com - Fort Lauderdale, FL
SE Palm Beach, Broward & NE Miami-Dade Counties FL
I think that if you do a good job educating them with the facts and fugures you can get them to list. I konw I do.
Oct 12, 2006 01:48 AM
Carolyn Nelson
Realty One Carolina, LLC - Burlington, NC
Your Triangle to Triad Real Estate Expert!
FSBOs are very hard to work. One of my agents use LandVoice.com She gets a lot of leads but it usually takes 3 - 4 weeks to turn a FSBO into a listing. Most want to sell it themselves at first and after not having any showings or offers, then they become interested in having the agent assist. Some will also pay a fee for assistance but will not list.
Oct 12, 2006 09:42 AM
Bob Cooper
Principle Broker / Owner - Bend, OR

Ok, we're back from a much needed 2-week vacation!  To those who asked me for the tools I use to get FSBOs (unrepresented sellers- NAR preferred term) to hire you, I recommend a few "consumer" DVDs by David Knox.  These are inexpensive DVD videos you may purchase to swing the FSBO your way.

I loan the short videos to a receptive FSBO seller for a couple of days and then return to pick them up.  It's at this time you may offer to answer any questions lingering in their mind about selling their property themselves.  Also, I buy self-adhesive business card holders and apply one to the backside of each DVD case and slip in a business card.  This reminds the FSBO owner that the DVD belongs to you and it also promotes your services to them.

These are my recommneded David Knox videos:

- Selling "By Owner"

- Pricing Your Home To Sell

- Preparing Your Home To Sell

Another useful video by David Knox is "Seller Counseling - What Sellers Won't Tell You...Unless You Ask".

Now, go have a good day!

Bob

Oct 26, 2006 03:05 AM