YESTalk-139 - Should I Hold Open Houses for FSBOs?

Welcome to Kevin Ward's Yes Talk for Realtors. This is Kevin Ward. You're actually training them not to hire you. Why should they hire you? You're already working for them for free. So one of the great questions that I get occasionally on Facebook or on YouTube is should I hold open houses for for sale by owners? So you've got somebody trying to sell their house on their own without using a real estate agent. And the question is, should I help them? Should I do it first? Do open houses for them. And a lot of trainers out there and a lot of brokers and coaches and managers say yeah, go out there, help them do it. I say you shouldn't. I say it is a huge mistake. And in this video I'm going to explain to you why it is a huge mistake and why you should never do it and then talk about what is a better approach. So let's talk about this. Should I hold open houses for for sale by owners? So my first question that I have to ask is why? Why would you do that? Why would you hold an open house for somebody who's not going to pay you and who does not want to pay you? I'm like, why does that make sense? Well, normally I get two answers when I ask the question and all the times that I've heard somebody say you should do it and heard trainers say this is a great strategy, man. This is a get your foot in the door strategy. And it is, it's just a bad one. And I'm going to explain this why. So first, the two answers I get commonly are this. One, the reason I would do it for a Versail by owner is so they can see how hard I'm working for them. When they see how hard I'm working and they see me working for them for free, that they'll get to like me and they'll trust me. And if they eventually get side to hire an agent, then they'll hire me. And the second reason that that's the main one by the way, the second reason why somebody would hold a open house for a for sale by owner when you're not getting paid for listing their house or for selling it is because I want the buyers. So buyers come in, they're probably not going to buy the for sale by owner's house, but I may get a buyer out of it and so I'll do it to get buyers. Alright? So those are the main two reasons. If you have another reason for holding a for sale by owner, an open house for a for sale by Owner, please post it in the comments below. So I know what you're thinking and I can answer it. So here's four. So the answer is, should I should I hold open houses for for sale by owners is no. And here are four reasons why it is bad business, why it's bad for your success, it's bad for what you're trying to do because you're trying to either get the for sale by owner to want to hire you, you're trying to get in with them, get your foot in the door, or you're just trying to get buyers. So number one, when you hold a for sale by owner open house for a for sale by owner, number one, what are you telling them about how good you are? Well, you're telling them you have no business. You tell them, I got nothing else to do, I got nothing better to do on weekends, so I'm willing to work for free. Now this works perfect and it's a perfect strategy. If you don't value your time and if you got nothing else better to do, why not? Well, why not? Because it's bad for other reasons. But number one is you're immediately communicating to the vercel by owner, I really don't have any business of my own. I don't have anything to make me money. So I'm just going to work for you for free. So it would make a for sale buyer go like, why are they working for me for free? They're really not that bright. That's what my friend a for sale by owner is thinking about you. Second reason why holding a open house for a for sale by owner is a huge mistake. And it's this. You're actually training them not to hire you. Why should they hire you? You're already working for them for free. You see, you think you've got a whole bunch more value you could bring to them if they actually listed with you and you're just showing them a sampling. But what they're looking at is, well, this person, if they had a buyer, they would bring them. No brainer. So why should I list with them? They're already working for me. They already know about my house. Why in the world would I list with them? And they're actually trying to sell my house for me already and they're doing it for no commission. So you're actually training them to do the very thing that you probably want them to do. And that is I'm hoping that if I get my foot in the door and I show them how hard I'm working for them that they'll eventually list with me. And you're actually training them to do just the opposite. Number three, the third reason why holding a for sale by owner open house is a mistake is because it's total bs Your motivation. Because see, I happen to believe that why you do what you do is as important as what you're actually doing. If your motivation for doing it is to get the listing and you're doing it by pretending to help them, it's just a tactic that I'm really just acting like because you're, you know that it's, you're probably not going to sell their house. You don't want to sell their house. Why would you do it for free? So you're not actually trying to do something that is in their best interest. You're actually trying to do something for your best interest for your if it would just get a listing. And that's just total bs. You're acting like you're helping them when your motivation is to get a listing. It's a bait and switch. I'm baiting them with this activity, but the switch is that I'll switch them to get a listing. BS my friends. And it's one of the reasons that our industry has such a bad reputation with people is because we'll actually stoop to those kind of BS tactics. Just think about it. Think about, I know you've had people that you respect and people that you like and maybe told you this is a great strategy, but think about what I'm saying. Like, is this really a great. Is this really a professional strategy or is this a strategy for somebody that doesn't have anything better to do and they're at just. They're scraping the bottom of the barrel trying to get business. Now hang with me here because I'm going to give you. In a minute, in a minute, I'm going to give you the solution for, well, if I, if I don't do this, how do I get for sale by owner listings? How do I get business? I'm going to get to that, but for right now, I just want you to understand why it's a mistake. Number four, the fourth reason that it's a mistake to hold an open house for a for sale by owner is that if your motivation is to get buyers, it is a great way to get you busy, but it is a bad way to get you business. In other words, if you want to use your weekends to hold an open house for a for sale by owner, it will probably keep you busy. For the weekend, but it will rarely get you paid. See, if you're genuinely trying to get buyers. How's it, let me just ask this, how's it working out? How's it working out holding open houses for for sale by owners who do you know out there that's actually making a lot of money by holding open houses for for sale by owners? And the answer is none. You see, here's here is. Let me just explain why the buyers that would attend a for sale by owner open house are one, if you're looking for buyers, this is the worst buyers to look for a couple of reasons. Number one, why do buyers go to a for sale by owner to begin with? Well, number one, mainly because either they are bargain hunters and they know that this for sale by owner is not having to pay a commission. So like we can get a better deal on this house because it's a for sale by owner. So we're looking for that cheap deal. Okay, that's going to be a buyer who doesn't want to work with you, an agent. They already have said we are skipping the agents so they're less likely to even want to work with you to begin with. And number two, the main reason that people will go to a for sale by owner instead of going to a house that's listed with a real estate agent and as a buyer is because they can't buy a house. They're not actually qualified to buy a house. And so if you've prospected and talked to a lot of for sale by owners like I have for years, I've listed and sold hundreds and hundreds of for sale by owners. What you'll discover is one of the biggest problems that for sale by owners have is that the buyers they attract a lot of times and they'll say this, you'll hear the for sale owner going like, yeah, well, I've had, I'm getting these people that are coming in, they're asking me if I'll own or finance it for them or they want to do a lease to own, you know, a lease option. Well, the reason is because they can't actually qualify to get a mortgage to buy a house. They don't have money, they don't have a job, they don't have good credit. And that's why they're not working with an agent, because an agent won't work with them, because an agent knows they can't qualify for a house. So they're going to for sale by owner hoping they can, you know, figure out a way to Kind of talk the seller into financing it for them or letting them rent it and then buy it later. In other words, the kind of buyers that get attracted to a for sale by owner's open house typically are a very low quality buyer lead. Now, even high quality buyer leads take a lot of time, they take a lot of effort, and a lot of them aren't going to actually buy a house with you. And now you're talking about going after the lowest life form on the real estate food chain and saying, okay, I'm going to get business there. My friends, if you're going to spend three or four hours trying to generate business, there are way more effective and more productive strategies than holding an open house for a for sale by owner. And if you're trying to get a listing from a for sale by owner, there is an insanely more effective strategy than by pretending to help them by holding open houses for them. So what's the solution? What is the solution? If I, why do I do it? If I want to get a listing? If I want for sale by owners, if I'm trying to build a business, what is the solution? Here's the solution. Learn how to convince a for sale by owner to actually hire you to actually let you list their house and sell it for top dollar. That's the solution. Because here is the fact, you know, let me go ask a question. Why should they hire you? Why should they hire you when you come and talk to them? And here's why. Because if you know what to do and how to do it as a real estate professional, you can get them a better price. You can get them, you can get them a better result in three ways. Number one, you can get them more money. Number two is you can get their home sold for faster. And number three, you can do it with less hassle because you take care of everything for them. You can actually deliver a better result for a for sale banner than they can for themselves. And almost every time you can help them net as much or more money in their pocket than they could do by themselves. See, here's one of the reasons that we have all these like BS strategies for for sale by owners. And that is we actually believe the for sale by owner story. The for sale by owner story is, is if you're a real estate agent, you're going to cost me money. You're going to be an expense to me because I have to pay you a commission. And they think that commission paid is actually money coming out of their bottom line pocket. And the reality is if you know what to do to get a home sold for top dollar, you can actually net them as much or more money as they can by doing it themselves. Why? Because you can get them better exposure to a better quality of buyer in a better amount of time to get their property sold for top dollar. And when you do that, you're going to get better quality offers, which means more money and even after commissions and everything. And they're almost always willing to pay half the commission already, right? I'll pay you a buyer's agent commission most of the time. So you only have to add the extra value is for the listing side of it. If you can help them get an extra 5% compared to what they could do it for themselves, it's a break even or 6%, it's a break even. And that's almost always, always. And they're already willing to give 3% away. So all you got to do is actually justify an extra 3%. And my friend, you can do that now if you're going like, but I don't know how, what do I say? How do I approach them and all that kind of stuff. That is what I train. And if you want to learn how to master listing and selling for sale by owners and literally how do you get a listing appointment on the very first conversation with a for sale by owner? Because I did it all the time. 20% of the sell by owners I could talk to that I talked to, I could get a listing employment on the very first conversation. And you can too. You just have to master what to do, how to approach it, what to say and how to say it. And that's what I train at FX Extreme Training Camp. FX stands for F for sell by owners, X for expireds. It is the best training in the world on mastering listing and selling for sale by owners and listing expel and listing and selling expired listings in high volume. And in the link below is the registration page for our FX Extreme Training Camp that's coming up in Los Angeles this summer. Make sure you click on the link below. And if you want to master listing and selling for sale by owners, listing and expelling and selling expires. In fact, we're also going to be talking about how to get probate listings and sell them and how to get distressed sellers short sells, nods and list and sell their properties. We're going to be training all of that this year at FX Extreme Training Camp. You can click on the link in the description of the video and go there and it'll tell you all about it. Get your ticket and come join me in Los Angeles for FX Extreme Training Camp. It's three days. We're going to be training personally with me on how to master these guys. Instead of wasting your time trying to figure out some strategy of holding an open house for a for subway owner, there's a much better way, my friend. If you have any questions or thoughts, post them down below. If you have any challenges, if you disagree with this, post it down below. I'd love to hear your comments so that we can carry on this conversation. If the video has helped you, make sure you give it a thumbs up. Go check out FX Extreme Training Camp. I'll look forward to seeing you in June in Los Angeles. Hey there, it's Kevin. Did you like today's podcast? If you did, be sure to subscribe to the next one and tell a friend about us. If you want more free training and resources that are the best to help you get more Yeses with no BS, visit me@yesmasters.com until next time. Remember every day to embrace life, engage opportunity and always expect y.