Ultimate Guide to FSBO Leads for Realtors | 2021
For-sale-by-owner (FSBO) real estate leads is a great lead source for both newbies and pros alike.
FSBOs are homeowners who are selling their house without a real estate agent, usually to save money on the commission.
While there are times FSBO makes sense (selling to a family member, the owner is a licensed agent or investor), most often FSBOs are likely poorly served by the FSBO process. They may underestimate the value of listing with an agent. They may underestimate the importance of the MLS.
Below are some interesting stats about FSBO sellers from the National Association of Realtors (NAR) 2020 Home Buyer and Seller Profile:
- Only 56% of FSBOs used recently sold comps to price their home
- 46% of FSBOs do NO marketing
What a giant opening for an agent to be a value-add! A savvy agent can educate a homeowner on the process and market and turn it into a win-win listing for both agent and homeowner.
Pros and Cons of FSBOs
Here’s what to weigh before deciding on FSBO leads as your lead generation strategy of choice.
Pros
- Quick results. FSBO homeowners are already on the market and ready to sell! Persuade them that your services are a net benefit and it can be a quick listing.
- Cheap strategy. You can prospect FSBOs without buying dialers, FSBO lists, or direct mail pieces, though those may make it more convenient. In fact, it’s free to just browse online for FSBO homeowners and contact them.
- Natural companion strategy for expireds. FSBO and expired homeowner are very different types of homeowners and require significantly different strategies. But the techniques are similar: cold calling and direct mail. If you’re already working expireds, expanding to FSBOs is easy.
Cons
- Limited volume. My own zip code has just 2 FSBO listings on Zillow as of this writing. FSBO alone is unlikely to provide for your whole business in many markets.
- Competitive. Marketing to FSBOs is a popular marketing strategy. You’ll have to go the extra mile to stand out to homeowner who are sick of getting calls from agents.
- Winning over skeptics. FSBOs tried to skip on professional representation already, meaning they have at least one strong objection to using your services. It may mean a tougher sale than your median prospect.
If these don’t appeal to you or your style, consider and compare it to other lead generation strategies.
How to Find FSBO Leads
There are several paid lists you can purchase that aggregate FSBOs in your area.
Zillow is still one of the most popular sites to advertise FSBO for sale. You can filter By Owner and ensure you are looking at the tab for “Other Listings”. You can even set up a Zillow alert to send these listings to your email each time a new one is set up.
Zillow doesn’t have the owner’s phone number like they once did. Unfortunately, there isn’t an easy way around this other than possibly subscribing to list source that matches these listings with phone numbers. You can also skip the phone call and instead mail customized listing packets to FSBO owners instead.
Zillow and Trulia are the same company and FSBOs on Zillow should be the same on Trulia.
Other FSBO sites include:
Facebook groups are also great places to find leads (some of which may not make it to the paid lists, even).
The groups obviously loudly proclaim “NO REALTORS”, so you may have to get a little sneaky or else risk banishment.
Converting FSBO Leads
To prospect FSBOs, create a time block daily or weekly to contact new FSBO leads as well as continue checking in on past FSBO contacts. The goal is to keep the conversation going and turn it into an appointment.
FSBO Scripts
A FSBO has already decided against using a Realtor, though not necessarily permanently. Some FSBO sellers aren’t anti-agent, but trying to sell themselves before giving a Realtor a try.
There are a small fraction of FSBO homeowners who just don’t want anything to do with real estate agents.
Only a small percentage of FSBOs simply don’t want to work with an agent. Instead, the vast majority who sold to a buyer they didn’t know objected to the commission.
Work on your commission objections!
Your Value Proposition to FSBO Sellers
Meanwhile, again according to NAR, the three most difficult tasks for FSBOs are reported as:
- Preparing or fixing up the home for sale
- Understanding and performing the paperwork
- Getting the price right
If you are trying to build a business around appealing to FSBO sellers, creating unique selling propositions (USPs) and scripts that address these pain points are the best way to win the listing.
Differences from Expireds
Expired listings and FSBO homeowners are very different targets.
Expired listings are homeowner that do not object to using a Realtor. They already tried at least one. You are more likely to have different challenges with expired listings like working with the home condition, price, or availability.
FSBO homeowners may not be overpriced or have condition problems. I’ve worked with FSBO clients that were underpriced! Instead, they are looking for cost savings on the commission or just think they can do better than an agent. You will be focused on demonstrating your value to the transaction.
FSBO Tips for Realtors
- Set a Date. You won’t likely get a seller ready to sign a listing with you on your first phone call, and you shouldn’t expect to. Instead, set a more achievable goal like getting face-to-face time with the seller via a preview appointment.
- Send a Mail Piece. You may not always reach the seller by phone. Or, if you do, you were one of tens or hundreds of other agents who did the same. Sending something in the mail is a way to stand out from the crowd. There usually aren’t that many FSBOs, so sending regular and thoughtful FSBO packages isn’t too expensive or time-consuming. Include a list of sales in the neighborhood and your value add.
- Follow Up is Still Required. FSBOs can be very quick leads. After two weeks as a FSBO with no good buyers, some are ready to list and get it sold! But FSBOs are also one of the least motivated seller groups. Only 5% need to sell “very urgently” versus 15% of traditional sellers. It’s not uncommon for FSBO homes to sit on the market, overpriced, and the sellers aren’t too bothered about it. You can’t quit after your first call, first week, or first month of follow-up. Just like other leads, you need to be persistent and in it for the long haul.
Examples of Agents Successfully Working FSBOs
Paula Burlison
Paula Burlison is a successful Nevada agent for whom FSBO is a pillar of her business.
You can hear more about Paula and her marketing strategies on her interview at Mastermind Agent with Mike Cerrone.
She also works withdrawn and expired listings, which you can watch during an interview with REDX.
Jeff Glover
Jeff Glover is a top agent who is also a coach. In fact, you can see some of his FSBO resources at his coaching site Glover U. You can also follow his YouTube channel where he talks about his FSBO marketing and business plans.
Jeff was interviewed by Mike Cerrone as well on his Success Calls where he talks about his for-sale-by-owner approach as well as the rest of his business best practices!
Resources and Training
Remember, here at Hooquest, I believe in spending as little money as possible. I don’t recommend purchasing coaching, training, or advertising until your business is already working. Especially with FSBOs, you can work the entire system without spending a dime. Do it consistently for a month before judging the results. If it is working for you, then maybe you can consider investing in tools like a dialer or lists.
Podcast Episodes
The following are some podcast episodes featuring Realtors talking about their FSBO marketing tips and tricks in our industry.
- Master Mind Agent: SC173: Tim Houk. A winning approach to listing FSBOs.
- Real Estate Rockstars: 748: Reverse Selling: The Secret to Getting FSBO Listings with Brandon Mulrenin
- Master Mind Agent: SC182: Craig Wilburn. Laid back approach to listing FSBOs
Coaches / Training
Borino
Borino (I don’t know his full name – I guess he just has one, like Madonna or Cher) has lots of quality YouTube content as well as a FSBO coaching program naturally named “FSBOrino“.
Brandon Mulrenin
Brandon Mulrenin has a great YouTube channel on all things real estate, but with a special focus on prospecting methods like FSBOs and expireds.
Kevin Ward
If you’re interested in prospecting FSBO, chances are you already have run into Kevin Ward. He has a prolific YouTube channel with lots of advice on FSBOs and an emphasis on best practices for scripts.
He runs his own coaching company at YesMasters and is the author of the Book of Yes available on Amazon.
Books
How to be a FSBO Master: Real Estate agents that REALLY work
Jason Morris is the education director at the Go School for real estate agents in North Carolina. He has written several books for agents on Amazon, including this 101 page guide to prospecting FSBOs, published in 2017.
Tools and Software
I don’t recommend buying any software up front. When you’re successfully prospecting FSBOs, however, there are some tools and lists that can leverage your time effectively. Specifically, you may want to consider a dialer and a list source.
Below are a few such tools aimed at FSBO prospecting.
Vulcan7
$359/mo. Vulcan7 is a well-reviewed power dialer that also provides FSBO, expired, neighborhood, and probate lists. It also has a CRM backend, email and video marketing tools.
Espresso Agent
$199+/mo. Espresso Agent is a real estate dialer and marketing tool. They sell complete packages of lists with a CRM, dialer, and email marketing tool. Their email marketing includes the ability to send video emails via StoryTellr. Their lists include FSBOs, expireds, and neighborhood geofarming.
REDX
$99/mo for the Storm Dialer. RedX is best known for its expired and FSBO lists, but also has its own Dialer and backend. For the sophisticated, they also offer Onyx, which is pitched as high end, exclusive leads.
Landvoice
$40+/mo. Landvoice is a well-known service that provides real estate lists, including FSBO, expired, preforeclosure, and farm lists. Their lists include phone numbers. These lists can be easily added to a mailing service or into a dialer to prospect real estate leads.
Rebogateway
$59+/mo. Rebogateway is a real estate list service that offers a wide product range including divorce, tax defaults, expireds, FSBOs, notice of defaults, just listed, just sold, and more. They have additional features like tract utility allowing users to target higher turnover tracts.
Conclusion
I personally did very little FSBO prospecting as a Realtor and only ever listed one; but it was a great experience!
I sent them a mailer with the MLS printout of their home and neighborhood sales, as well as a single page pitching my value. They called me up after having been listed on the market three weeks. They weren’t anti-agent or unreasonable people. They just wanted to see if they could do it themselves and save the commission.
I told them they should raise the price.
I listed it at the higher price and sold it in two weeks. They later gave me a referral for a listing I also sold! All in my first year as an agent!
For-sale-by-owner listings, especially combined with expireds leads, can run your entire business in the right market. It’s an especially appealing lead generation idea for newer agents as the upfront investment is minimal, or even zero!