FSBO or For Sale by Owner properties are one of the highly sought deals by realtors and investors, and for good reason. While FSBOs account for ~8% of sold homes (National Association of REALTORS®)—they allow directly approaching homeowners who are rather motivated to sell their home.
In simple words, FSBO are properties sold directly by the homeowner, without involving a real estate agent.
What Makes FSBOs Lucrative Opportunity?
FSBO homeowners are already interested in selling. So why are they NOT hiring a real estate agent?
The answer is obvious—to avoid paying agent commission.
Unfortunately for them (and fortunately for realtors), they lack the professional understanding of the market, how to find buyers quickly, negotiation skill to land a better price, and navigating the whole process. Moreover, FSBOs generally lack access to the MLS, preventing them from getting broader market exposure.
And this is where you, as a real estate professional, can step in to maximize profit.
The best part about FSBOs is, the longer a home remains unsold in the market, the more likely you can convert the client. As the homeowner remains unsuccessful in selling by themselves, they start to recognize the need of a professional.
So How Do You Find FSBO Leads?
FSBOs aren’t listed on the MLS platforms, which is both its merit and demerit.
Not being on the MLS means these properties have lower competition but you’ll have to find alternative ways to curate these leads. We tried to list all the best lead sources down below:
Free Sources for FSBO Leads
1. Driving for Dollars: This is one of oldest yet very effective ways to find FSBO leads. Take a drive around neighborhoods and look out for “For Sale by Owner” signs. Once you spot one, go ahead and start knocking.
2. Leveraging Local Networks: Referrals are a great method to get genuine leads, not just for FSBOs but any type of home leads. Ask referrals from friends, family, and other realtors. Connecting with community members and attending neighborhood events can expand your network.
3. Leverage Online Platforms: Craigslist and Facebook Marketplace are popular spots homeowners prefer to advertise.
4. Social Media: Social media is great for both marketing and looking up information. Check out homeowner Facebook groups, especially those related to real estate. Join these groups, participate in discussions, and watch for FSBO related posts. These groups don’t allow realtors to join or advertise their services, so you have to be a little sneaky to get accepted and promote your services.
5. Public Records and Auctions: Public records for property sales and local real estate auctions often include properties that haven’t been listed traditionally.
6. Local Newspapers: Many homeowners still like old-fashioned newspaper advertising. So scan the classified sections of local newspapers and neighborhood apps like Nextdoor to locate FSBO listings.
7. FSBO.com: FSBO.com is specifically designed for homeowners who want to sell properties without an agent. Go to the site and search properties to buy. You can add filters to search for properties in your preferred locations. While some homeowners list their direct contact numbers, most prefer that you send them a message through the platform. All of these properties mention their address, so you can simply drive in and knock on the door.
8. ForSaleByOwner.com: Another platform similar to FSBO.com that’s specifically designed for FSBO sellers. This one has more robust features and only allows you to send sellers messages through their platform. But they accurately show the sellers location on a map.
Paid Sources for FSBO Leads
Let’s be honest, sometimes investing in lead acquisition is a more efficient approach. Plus, paid leads will get you verified bulk information, saving you a lot of time. Here are some top FSBO lead providers on internet:
1. Zillow
One of the go-to platforms many real estate buyers and sellers rely on. Zillow allows you to find properties listed as “For Sale By Owner” and you can show ads to targeted audiences. Set up Zillow alerts to get notifications whenever a new FSBO listing is posted in your target area. Zillow often serves as the starting point for FSBO sellers, acting as a hub for potential leads. You should also check out their “Make Me Move” section, where homeowners indicate if they are willing to sell. Zillow doesn’t sell bulk leads but charges on the basis of advertising.
2. REI Data Solutions:
REI Data Solutions specializes in bulk lead generation for motivated sellers such as FSBOs, pre-foreclosure, foreclosures, probates, vacant homes etc. Their basic pricing is $40/month making them one of the cheapest lead providers in the market. Committing to an annual plan offers 3 months of free service. REI Data Solutions is popular among agents who want reliable lead data without the higher costs. Apart from leads, they also offer marketing, accounting, and VA services.
3. Rebogateway:
While their current website doesn’t mention pricing, HooQuest reports a $59/month plan with other itemized services. This platform offers a variety of lead lists, including FSBO, divorce, tax defaults, and more. They also feature tools to target higher turnover areas, helping agents focus on specific neighborhoods.
4. Landvoice:
Starter plan costs $87/month and provides FSBO, expired, preforeclosure, and farm lists with integrated phone numbers. Another cost-effective way to acquire leads that can be imported into their CRM or dialer.
5. REDX:
Priced at $99/month, REDX offers FSBO and expired listings along with its own dialing system, the Storm Dialer.
6. Espresso Agent:
Basic package costs $199/month. Espresso Agent offers a combination of FSBO, expired listings, and neighborhood farming lists. They include CRM, dialer and email marketing tools, making it a robust option for agents.
7. Vulcan7:
Priced at $359/month, Vulcan7 is a premium platform for extensive FSBO, expired, neighborhood, and probate databases. It also has CRM capabilities and offers email and video marketing tools.
What Pros and Cons You will Face Dealing with FSBOs
| Pros | Cons |
|---|---|
| Quick Results: These homeowners are already motivated to sell, which can result in quick listings. Demonstrate that your services can improve their chances of faster selling to convert them. | Limited Volume: FSBOs are not plentiful in the market, but that is what makes them special. You cannot solely rely on FSBO leads for a sustainable business. |
| Cost-Effective: Unlike other lead generation approaches, FSBO prospecting can be done without higher upfront costs. Often, browsing online platforms and reaching out directly can be a free and effective method. | Competition: FSBO marketing is a popular strategy these days, meaning you are not the only agent contacting these homeowners. |
| Conversion Potential: Many FSBO homeowners eventually realize they need professional help to sell faster and switch to an agent when personal efforts fail. | Skepticism: Homeowners choosing to sell by themselves typically wish to avoid paying commissions and believe they can do it themselves. As an agent you will have to overcome this mindset, making it more challenging to convert them. |
| Direct Negotiation: These are homeowners you will directly negotiate with, giving you better opportunity to build relationships and address concerns. | |
| Complementary to Expired Listings: FSBO leads come naturally if you’re focusing on expired listings. While they require different approaches, they can be targeted through similar methods. |
How Do You Approach an FSBO Homeowner?
- Start by Asking Key Questions: Prepare script to ask questions that would reveal details about property possession and condition. These will help you gauge the seller’s openness to working with an agent and the property’s overall value.
- Consistent Follow-up: Create a dedicated time each day/week to reach out to new FSBO leads as well as maintain relationships with past contacts. Consistent follow ups will gradually convert a lead into a client.
- Prepare Tailored Script: Don’t go with the traditional scripts! Tailor scripts to address common FSBO pain points that the homeowner is likely to face or is facing. NAR survey shows the top challenges FSBO sellers face are preparing the home for sale (13%), managing paperwork (12%), and pricing correctly (18%). Knowing these struggles allows you to position yourself as a solution to their challenges.
- Set a Date: Don’t expect to secure a listing on the first call. Instead, aim for a more attainable goal, such as scheduling a face-to-face meeting. Personal interaction can help build trust and establish a rapport.
- Send a Mail: If you can’t reach them by phone or want to stand out from other agents, consider sending a personalized mail piece. It can be a simple yet effective way to get noticed. Include necessary information like recent closings you did in their neighborhood and highlight how you can solve their pain points.
What’s the Difference Between FSBO and Expired Listings
Expired Listings are properties that were previously listed with a real estate agent but did not sell before the listing contract expired. Homeowners with expired listings typically do not object to using another Realtor since they have already worked with one. The primary challenges in this case are addressing issues like property condition, pricing, or scheduling availability for showings.
FSBO homeowners, on the other hand, decided not to sell their property with a real estate agent. These sellers are driven by the desire to save up on commission fees or a belief that they can handle the sale process themselves. The key challenge with FSBO is to showcase what value a Realtor brings to the table.
Conclusion
Working with houses for sale by owner can be a great opportunity and enrich your experience as a real estate agent. FSBO homeowners start their journey thinking they can save on commission and handle the entire process by themselves but down the road realize why professional assistance pays off.
Offering insights and showing value, you can turn these homeowners into clients and even one successful closing can lead to many valuable referrals.
We hope this article helps you close amazing FSBO leads and cash in profits. Happy hunting!
