My FSBO Conversion Rate is 7 out of 10

By
Real Estate Agent with Century 21 Elite Performance

Bold statement? Not really it's just a fact.  So how? Let me share freely with my friends here at Activerain.com.  In my humble opinion this is the only way to market to FSBO's that is both cost effective and with very little out of pocket to you, pretty much all it costs you is gas for your car.  This blog is not a teaser, I'm not selling anything I'm simply going to tell you how I do it.  I must caveat this blog with "I am constantly looking out for my clients best interest." The standards of my FSBO practices are extremely ethical AND my approach is always an attempt to help the FSBO sell their home with or without me.  The end result is they typically will list with me. 

You will be required to drive to the FSBO's home, on average four times. You will need no pre-printed propaganda regarding you and or your company and you will not need to make a listing presentation to close this listing. By the time the FSBO is ready to list with you they will do so (99% of the time) by simply signing. "Where do I sign?" Let's begin with the first visit to the FSBO. You have heard before that it takes five or six visits to a FSBO before they convert. My average is four visits. What people don't tell you is how do you justify "x" amount of visits? What is your excuse to keep coming back without wearing your agenda on your sleeve? Simple, make your agenda helping them. Here's how it works.

  1. Initial Visit. I don't even bother with FSBO's that are already listed on the MLS, there are too many that are not and they do not qualify for this conversion strategy. Pull up to the FSBO with your car running and leave your car door open. You are "on your way to show a house in the neighborhood." A typical initial conversation would go something like this.  "Hi, sorry to disturb you, I'm on my way to show a home down the street, my name is _______ (hand card) I'm with Coldwell Banker Heritage Realtors. I like to make a habit of knowing all of the homes for sale in the _____ market so that when my buyer clients inquire about a home such as yours it sounds like I know what I'm talking about." (humor) Anyway, if you could quickly tell me your asking price, how many bedrooms and if you're willing to do a 3% buyer broker agreement I promise to get out of your hair." (if they don't know what that is I explain to them what that is - I explain that in order to encourage buyer agents that 3% satisfies most buyer broker agreements and encourages showings on your home. After they say yes I thank them for their time and conclude the brief encounter as follows.)  "Great! I have enough general information to share with someone should they ask." Sometimes the seller will invite me in their home - they'll want to show it to me but I NEVER go in the house on the first visit. If they ask me to do so it sets up my second appointment with them and I schedule a time to show it another time.  Then as I'm about to walk away or as I am backing away from the door (running to my appointment) I ask if they have all of their disclosures and lead based paint documentation.  If they say no I say "hold on a sec." and run to my car and hand it to them right on the spot. "The state requires you to fill these out and provide them to the buyer." Now... suppose they don't invite me in to see the house then my excuse to come back for a second visit is to drop off the disclosures, so the only time I hand the disclosures to them on the first visit is if I'm invited in the home, "the next time I'm in the neighborhood I'll drop them by." Sometimes depending upon how warm or cold they are I will say, "I'd like to see your home sometime to get more insider knowledge of the property, but perhaps another day that's convenient for you. In the meantime I will drop disclosures off the next time I'm in the neighborhood. If you're not home I'll simply leave them at your door or drop them in your mailbox." (I never drop them off - instead on my second visit if they're not home I keep attempting until they answer the door - reason being it's important to make that second face to face visit to proceed.
  2. Now we're at the second visit - wait no longer than three to four days from your initial visit. One way or the other you have prepared them to see your face again. This time I can turn the car off and shut the door as I have come specifically to see them - no sense of urgency on the second visit - a much more relaxed encounter. "Mr. Smith, hi I just wanted to drop these disclosures off as promised," (now if you were invited back and keeping to your appointment to view the house disregard that line and skip down to the walk through) "I mentioned your home to my buyer the other day but unfortunately they were really firm on their four bedroom criteria, otherwise I would have contacted you to show it. I wouldn't mind seeing the house sometime to gain better knowledge of the home and help sell it." Try and get the tour on the second visit if at all possible. If invited in at that time then we proceed to the walk through, if they say today's not a good day then set up a date time to see it. Be sure that if you do not walk through the house on the second visit that you do not leave the house without a specific date and time to do so. Now by this time you'll know if you have a hard cookie to crack - if you do that's something for another blog - "dealing with the tough cookie," this blog is meant to give you the general guidelines of converting FSBO's. Now that we're at the walk through I let them lead the conversation and as they walk me through the house I compliment them on their home saying something positive about each and every room - however I make it a point to look long at the defects.  I never say anything negative about the home but I do make sure that they see me looking at or even at times touching defects to the property. Sometimes when they see me looking at them they'll say something about it but I simply shrug it off like it's no big deal and we move on, but I keep subtly noticing the defects. This is an extremely later when you show them comps should they need to come down in their price. If there price is right it's still helpful when you start talking about staging etc... but by that time you're listing them and talking about your relationship in writing. Towards the end of your tour you move onto step three.
  3. "What are you currently doing to market your home?"  Here the answer varies but it's pretty much the same story, "well... we just really put the sign in the yard, we really haven't done much to market it. I guess run an ad in the paper," or they'll say they're on fsbo.com or some other FSBO website. I ask, "have you ever tried to search for homes on FSBO.com as if your were a prospective buyer? I've noticed on those sites that they're only as up to date as they people uploading to the sites, so imagine if you're a prospective buyer, folks have told me they've become frustrated using the sites because of wrong information. People have either listed it, sold it, taken if off the market etc... it's not consistent." I then go on to say this. "As a Realtor knowing what I know about real estate, do you want to know how I would go about marketing my home for sale by owner?" Guess what, they never say no.  "Sure."  I explain how expensive it is to advertise in the paper, and that after just a few ads you're up in the hundreds of dollars.  I go on to explain that the MLS is where they want to put their home, that there are many websites out there and or discount brokers who will list your home on the MLS for a flat fee, usually for no more than $400.00 to $500.00 at the most.  They'll upload your photos etc... and they will make your home viewable to all of the agents in your greater market that do not know your home exists. And here's the best part, you'll be on my companies website as well as all of my competitors websites AND Realtor.com, and we all spend millions of dollars to attract buyers to our sites!"  They start to look at me like I'm on drugs and or like they're waiting for the other shoe to drop.  "It gets better, in our market agents working exclusively with buyers often give their clients portal access to the MLS which automatically updates their buyers to new listings which match their criteria via e-mail - now you don't have to worry about whether or not an agent somehow misses your home on a search - now the buyers will contact their agent and tell them they want to see your home!" (Right about now they love you) "Around 80% of all buyers today search the internet for homes and love clicking on photos etc.. being on the MLS/IDX will ensure that they see your home should it meet their search parameters no matter what site they use!"  I answer any questions they have regarding this information I just freely gave them to sell their home and then I leave graciously thanking them for their time. I leave them with another card and say to them, should you decide not to go it alone, and want to interview agents please keep me in mind, I would love to sell this house for you."
  4. Return in five to seven days. "Hey, how are things going? Did you guys get your house on the MLS? Did you find a discount broker?" 95% of the time the answer is, "no, we just haven't gotten around to it, we've been too busy." Or, if they're already comfortable with you "We started thinking after you left that we may want to talk about listing our house?" :-)  Now if they don't ask you to list it on the third visit ask them if it's o.k. if you drop off some blank area Board contracts the next time you're in the neighborhood, so that if they get a hot buyer they can strike while the iron is hot. Leave them with some generic information about staging their home and removing clutter or some other helpful piece of information that would help them to sell their home.  
  5. Make your next visit. Stop by with the contracts but make sure to have your listing contracts with you as well. Remember eight out of ten FSBO's eventually list. This is a people business.  You have to get in front of people. Direct mail and phone calls will always lose to a guy like me. I'll beat you every time. Personalize this to fit your personality - this has been meant as a general guideline.  Good luck!

Comments (15)

-- Casey Brischle
Columbia Bank - Spokane, WA
Spokane Home Loan Mortgage Professional

Very thorough overview.  Sounds like you have had great sucess!  Thank you for taking the time to describe what you do!

Jun 07, 2008 10:40 AM
Anonymous
Jon Higgins ABR

Casey - thanks for taking the time to comment on what you read. Really it's just a gerneral guideline for how I go about it - there's room there to add your own personality but statistics show that with FSBO's there is a strong corelation between success rate and the number of times they have to see you before they are ready to list with you.  What's nice about this process is that I never have to make a listing presentation.  By the time it's time to list they're already sold on me. The service I can provide from there is iceing on the cake.

Jun 08, 2008 12:20 PM
#2
Anonymous
Michael Mullin

Jon, that's an incredible post.  First, you could sell that!  I've purchased too many other tools that were less specific in the details than you just were!

Second, it works because you REALLY are trying to help the client with our without you. One of my all time favorite coaches, Joe Stumpf (www.byreferralonlyl.com) said "sellers can smell commission breath!"

I'll be implementing some of your stuff into my FSBO campaign.  Thanks!

Jun 12, 2008 04:54 AM
#3
Jon Higgins
Century 21 Elite Performance - Springboro, OH
ABR

Micahel - yes they can smell it - which is why you have to spray "OUST" desensitizing spray all over your body before you knock on the door.  But seriously, it's our sincere attempt at helping the client sell their home that melts away all of that "commission smell" that you speak of. The process of FSBO to listing is similar to the process of grief.  They have to get to the acceptance phase and if you're helping them to get over the idea so that they can move onto acceptance with as little strain on the emotions, ego you're going to earn their trust.  That's why at the end of my FSBO approach I rarely, (and I don't think ever) have had to make a listing presentation.  If I do I usually tell them what I'm going to do for them in marketing their home AFTER they have signed the listing agreement and to them it's icing on the cake.

I wanted to mention one other thing. You know the part where we give the FSBO all of the knowledge they need to cost effectively market their home?  And you know the part where we come back and they almost always never take the free advice?  Guess what?  Realtors are the same way.  I have shared this strategy (with those who've asked) with some of my office mates and guess what, the next time I see them around I ask if they've tried it and I usually get "I think I'm going to concentrate on expireds right now."  Some agents opposed to trying this have found that they too have similar fears as the FSBO.  Sometimes it's fear of success or rejection or whatever.  The point is the difference between the agent and the FSBO is that the agent has the knowledge and the plan to help the FSBO alleviate that fear, and in helping them through their fears as FSBO the agent is helping themselves with their own fears.  Kinda like a self help group with a commission at the end of it! 

Jun 12, 2008 05:33 AM
Tim Derylak
Keller Williams Realty - Fort Mill, SC

Jon, that is a terrific system!  So easy and nonthreatening to sellers. 

Sep 10, 2010 02:42 AM
Anonymous
Rex

Hi Jon

I'm a Century21 REALTOR in Winnipeg, Manitoba, Canada.
We still have a strong seller's market & I've been banging my head on the wall trying to find a successful FSBO strategy.
Your method is so staight forward & simple.
I've been working FSBOs with less than satisfying success.
When I read your blog, a light appeared over my head.
There are many companies & people charging money for systems & programs that don't even come close to the proceedure you outlined in your blog.
I will implement your proceedure immediately.

FSBOs are going to be my main target market as all the REALTORs I've talked to say they're to much trouble (seasoned veterans) or they're scared of them.

I'll let you know how I make out.

 

Rex

Mar 04, 2013 12:26 AM
#7
Ian Westwood
Mocksville, NC
Loyalty, Honesty, Commitment

Hi Jon. I really like your non-threatening approach, and I would certainly have fallen for it!! I will be trying it out over the next few weeks and hope to see some really positive results. Thanks again. Ian

Mar 08, 2014 12:03 AM
Calvin Neely
FLI Properties - Lagrange, GA
Let's get you moving!

Great post with all the details anyone needs to be successful with FSBOs.  Everyone is different and many of the techniques may not work for your personality.  This technique is certainly less aggressive/in your face than many I have read about but sounds very effective.  Thanks for sharing it!

Mar 20, 2014 10:06 PM
Anonymous
jordan

Converting Expireds into listings is easy when using a www.SmartGuy800.com 800/SMS number. The FSBO can offer free 24 hour recorded information on their property and your lender can assist them pre-qualifying all their buyers. If they don't buy their house, your lender can send the now PREQUALIFIED buyers back to you to represent!

May 15, 2016 09:52 AM
#10
Anonymous
x92127

You mentioned at the very beginning of your method that you don't bother with FSBO's if they are already on the MLS. So, how do you find FSBO's that are not on the MLS?

Jul 13, 2016 06:36 AM
#11
Brittany Kinsland
MVP Realty - Naples, FL
In the top 10% of REALTORS® in Southwest Florida!

I realize this article was posted in 2008 but wow! Very informative. New agent - the most "prospecting" I do is on Craigslist. I post rentals and sales but mostly get rental leads which is putting food on the table but as you can imagine, its not organic haha! My humor... Anyway - as a new agent I dont have any sales or stats to show anyone I am capable of selling their home. I am still learning so many things my biggest "fear" is looking stupid because they ask a question I dont know the answer to. I dont want to assume most FSBO's are dummies, so what kind of questions should I be armed with answers to? 

Jul 19, 2016 11:44 PM
Rhonda Savoie
Nick Galiano Realty - New Orleans, LA

Thanks for the advice.  I loved what you wrote and hope to use it.  I am new to selling real estate and am looking for as much as advice as I can get.  This sounds like it will really work.  I will work on mastering this and making it my own.  Thanks again.

Oct 29, 2016 02:56 AM
Dave Halpern
Dave Halpern Real Estate Agent, Inc., Louisville, KY (502) 664-7827 - Louisville, KY
Louisville Short Sale Expert

Very compelling and very comprehensive. Thank you for sharing. Inspires me to get back into pursuing FSBO's.

Sep 11, 2017 06:29 PM
Anonymous
samara

This is great insight, thank you for sharing. I only do FSBO's as many agents don't like dealing with the rejection. I look at it as an active possibility; the want to sell and there is already a contact number...the works. I am realizing that in this area the relationship with the FSBO is most important. So again thank you for your insight, I'll definitely use it!

Jan 02, 2018 04:11 AM
#15
Anonymous
Patty

After you tell them how to get on MLS and onto the buyer agent radar—wouldn’t they ask you what they need you for? Or why are you telling me this? What is your response?

Apr 17, 2018 06:18 PM
#16