Recently, I stumbled onto some FSBOs statistics as published by National Association of REALTORS®. According to their research, the following is a breakdown of why sellers did NOT use an agent to get their house sold:
Did not want to pay commission fee: 46%
Sold it to a relative / friend / neighbor: 24%
Buyers contacted seller directly: 12%
Did not want to deal with an agent: 11%
Agent was unable to sell home: 4%
Could not find agent to handle transaction: 2%
Seller has a real estate license: 1%
Other: * less than 1%
If you’ve worked FSBOs, this list probably sounds familiar. At one point or another you’ve probably run into most of these as objections. But knowing the reasons why a seller might circumvent an agent, you can now strategize a way to get around them. Let’s go over some strategies you can employ to overcome three of these barriers separating you from taking on more FSBO listings.
Didn’t Want to Pay Commission
This of course is the most obvious reason owners sell themselves. They think they will save more money overall by not pay an agent. What most FSBOs don’t realize is that this is a complete fallacy. An interesting statistic from NAR® to back this up is “the typical FSBO home sold for $174,900 compared to $215,000 for agent-assisted home sales.” That means that FSBOs homes are selling for only 81% of their potential value. This is a point you have to cover when trying to convert FSBOs. You need to make them ask themselves this question: “Do I lose 6% by using an agent or 20% by selling it myself?”
Didn’t Want to Deal with an Agent
Apparently people think agents are a hassle to work with. What they don’t know is that there is way will far more “hassle” to deal with if you go into selling a house without an agent. In fact, the good folks at KCM recently posted a blog about all the reasons not to list by owner. One of the main points was that there are way too many people for the owner to deal and negotiate. In the process of selling a house you’re going to have to deal with buyers who want the best deal possible, buyer’s agents who want an even better deal not to mention attorneys, home inspectors, appraisers, and bank officers who’ll have to juggle relationships with. Remind owners of this and then let them know you are an experienced negotiator and that you already have a network of realty professionals who will make the process as smooth and hassle-free as possible.
Couldn’t Find an Agent to Handle Transaction
2% of FSBOs did not use an agent because they couldn’t find one to take them on. This is a very interesting figure. It’s not really an objection to overcome but it is informative and even encouraging. What it means is that means that one in every 50 FSBOs doesn’t know where to look to find an agent. Would you call 50 FSBOs if you knew one wanted to use an agent but didn’t know where to find one?