By Debbie Hanlon

I came across an interesting statistic recently that really surprised me. The number of sales by For Sale By Owners (FSBOs) has plummeted from 20 per cent to a mere nine per cent in the last decade.

I’m surprised because there has been a proliferation of FSBO-based companies as well as the growth of social media and Internet tools that are supposed to help people sell their homes without hiring a professional. Those avenues don’t seem to be working. When I read that statistic I couldn’t help but smile because I get a lot of my business from FSBOs and could never understand why more agents don’t.

That stat also highlights why well over half of all FSBOs (I’ve seen quoted numbers from 70 to 90 per cent) end up listing their home with an agent. It is just too difficult for an owner to sell their home. Understanding the paperwork, pricing the property right, staging, helping buyers obtain financing and just plain not having time to devote to selling a house are all obstacles every FSBO faces.

What do these obstacles do? They wear the FSBO down and what began as a great way to save and pocket an agent’s commission turns into an ongoing series of headaches and second guesses. The stubborn few who refuse to admit their mistake and hire a pro get the satisfaction of selling their house for $40,000 less than an agent would have gotten them on average.



Doesn’t that look like a situation ripe for the picking? It is but there’s a right and wrong way to make sure you’re the agent they choose when they’re ready to hire one.

First, you cannot overspend on the FSBO market with your time and effort any more than you can devote all your time to your farm area. As agents we have a multitude of real estate tasks we have to do daily, weekly and monthly and as a reaction to an event like a new listing or sale. We have to find new clients while keeping our current clients happy and keeping in touch with former clients, all at the same time. If we spend too much time on one area, obviously the other areas will suffer. For now let’s look simply at the FSBO market and what we need to know about that area of our business.

At the end of the day, success getting listings from the FSBO market is all about two things: timing and TOMA. Timing means that you don’t know when a FSBO will be ready to give up and do what they should have done in the beginning. Some FSBOs only last weeks, others hang on for months and you have to be there when they reach that tipping point. Your timing has to be perfect.

TOMA is marketing speak for Top Of Mind Awareness. That simply means that when a FSBO thinks of hiring an agent, you’re the one they think of. You’re the one they call. You’re the one who lists their home. You’re the one they pay.

Now, you have to stay top of mind with the least amount of time and effort and that’s why I developed my FSBO system.  I simply follow the steps outlined in it when prompted to do so and maintain contact with FSBOs without annoying them or coming on as too eager. I don’t have to think about what I should do next because my system is going to tell me. That frees up my time for other areas of business, all of which have their own systems that do the same thing, streamline my career and ensure that I make the most money possible with the least amount of effort. Smart effort I call it – that’s when your return equals or exceeds the effort you’ve made.

So go through the classified ads, take a picture of FSBO signs you see in your daily commute and make contact. That can be as simple as a phone call, a flier drop or even a knock on the door. Then maintain contact without annoying anyone and begin to build the relationship that will have the FSBO calling you.

3 COMMENTS

  1. Every word is true, Debbie.
    But in another time and another place. Do you have “mere listings” in your marketplace?

    Here that is a form of FSBO, and in no way can regular practitioners, if there is such a thing anymore, solicit that business.

    It’s all kind of like a “private MLS system” operating as a subset of the MLS system developed by and for paying members as an “internal” advertising system for sharing listing information with colleagues.

    But that definition no longer applies, considering all the new rules, and the mere listing folks ARE, themselves. now members and colleagues.

    So, just like in the old system wherein colleagues cannot solicit active business to change or cancel their contract, FSBO mere listings cannot “be solicited.” Some might mentally use the divorce analogy: alienation of affection… Could get sued.

    Perhaps things operate differently in your domicile? But this situation was brought about by CREA and CREA is the “national” mother ship.

    One might suggest: if there is a FSBO sign on the lawn or in a newspaper ad, if you intend to solicit that owner, say NOTHING except – is your house for sale on MLS? if yes, that is your clue to hightail yourself out of there – as in pronto.

    If you truly have a buyer, you should be able to locate the address in the MLS system to know how to make further official contact with the owner, perhaps.

    Things were so much simpler long ago, and far away, as in my experience herein (sometimes wish we could turn back the clock):

    I was only in the business a short time, and truly didn’t know WHAT to do. So I tried a little bit of everything initially, including reading the FSBO’s in the better type of business newspapers.

    The very first one I solicited produced enough commission at nearly 400k at 6 pts to carry my advertising costs for my listings for the whole upcoming year. That was a boatload of money 35 years ago. Well, really still is.

    I called the number in the paper; told the truth: I said I was NOT a buyer in camouflage, introduced myself to the corporate executive who volunteered that he was going through a divorce, and was moving out of the country.

    He said he would keep my name and number. Not exactly solace to my new REALTOR(r) soul. But within just a few days he actually called, and like you indicated, said he was too busy to take care of the sale personally.

    I had been told you have to make at least ten contact presentations to get one listing. HUH? That was NEVER my experience, my whole career. Likely not yours, either, one might suppose.

    I wrote up the listing at his price, before I met up with him, because I didn’t know any better. All he had to do was sign it. He had his divorce so he was the sole owner. The house was vacant.

    And comps for rural property are difficult to find, and more difficult to match up to a subject property.

    I wrote previously about the unusual, rural, all blue house that driveby buyers “just had to have.”
    That was this FSBO. Luck of a beginner.

    Quite an experience for a brand new agent. Upset not only a few people in the office, who insisted that the manager had given me that listing. I didn’t feel that I had to explain. And that didn’t go over well.

    I learned SO much. One of which was that I really didn’t want to do rural property out in the middle of no where, in freezing cold weather. But I had no right to complain. It helped pave the way to my success.

    I also used to love expiries, but here we are forbidden to try to catch them on the rebound now. Hard to figure that bright rule.

    But often “farming” will overcome that sort of obstacle. Just because they listed with a friend and it didn’t work – well, the owners just happen to know YOUR name as the otherwise local neighbourhood expert, purely due to your visibility. So they place the magic call.

    And when they experience what didn’t work the first time, often they will call the rep with the most history in the area. Done like dinner. Signs have babies, like rabbits reproduce.

    And by then the owners are often more open to suggestion, and following direction.

    I always enjoy your REM writings, that bring back delicious memories. And yes, real estate is local, but most of the rules are national. Especially the more so after the BIG NFLD “meeting.”

    Carolyne L

  2. REGISTRANTS STOP DO NOT FOLLOW THIS ADVICE!!!!
    The advice in this article became invalid in 2012 when “mere postings” which are FSBOs and acknowledged as such by some provincial regulators, were embraced by CREA. The moment CREA embraced FSBOs, FSBO companies spent a couple thousand bucks and joined ORE, immediately getting protected from REALTORS being able to warn the public against a fellow registrant.
    Other FSBO companies like Property Guys have partnered with registrants to post listings on the mls again rendering this article’s approach to dangerous against trading regulations and Code of Ethics complaince and Competition Bureau fears issued by ORE.

    ORE has realistically taken this money making opportunity away from the 90% of it’s members who would never take a FSBO. So contact Debbie and ask her for workarounds to your local situation.

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