🏡 What is a prospective buyer in real estate?
In real estate, a prospective buyer is anyone who may potentially buy your home. To successfully sell your home, you’ll have to communicate with potentially dozens of prospective buyers until you find one who’s serious about purchasing your property.
Keeping track of prospective buyers is an essential step for any home seller. While a real estate agent traditionally handles this communication, you’ll have to handle it yourself if you’re planning to sell your home for sale by owner (FSBO).
In theory, building relationships with potential buyers means you can periodically reach out to them and try to entice them into a home purchase.
This is especially important when you’re selling FSBO, since you may have a tougher time marketing your home, resulting in a smaller pool of buyers. Plus, some buyer’s agents don’t want to show FSBO homes because they’ve had bad experience with agentless sellers in the past. Keeping track of any serious, potential buyers can work in your favor.
The biggest reason why sellers consider selling FSBO is to avoid the 2.5-3% agent commission. But juggling marketing and negotiations with prospective buyers — not to mention the legal complexities of a home sale — is very difficult for the average home seller, we recommend going with a discount real estate agent instead.
What Does a Prospective Buyer Look Like?
A prospective buyer is anyone who may be interested in buying your home. Showings and open houses are your best opportunities to meet prospective buyers.
But if a buyer tours your home and doesn’t make an offer, don’t count them out just yet — they can still be a potential buyer.
Buyers in many markets have limited options, due to low inventory and fierce competition for the few available homes. If buyers have worked their way through all current available homes (including yours), they’re likely to reconsider homes they initially dismissed. This is why keeping track of potential buyers is a good idea as a FSBO seller.
How to Follow Up With Prospective Buyers
Following-up with buyers can help motivate them to consider your home. It’s also a good way of narrowing down a list of serious buyers, since open houses can attract window shoppers.
To start, we recommend keeping an open mind. Treat everyone who shows interest in your home as a potential lead.
One of the best ways you can keep in touch with prospective buyers is by creating an open house sign-in sheet. That way, you can log each prospective buyer’s contact info and reach out later.
You’ll want to gather essential details including:
The name of the person or agent who viewed the house
The date of the showing
Contact information and preferred contact method
Any feedback they’d like to share (for open houses)
Be sure to reassure prospective buyers that you’ll respect their privacy and information. Let them know why you want their contact information and that you might be reaching out to tell them about a price change or if you receive another offer they may want to counter.
After your open houses or showing, keep this information in a prospective buyer log, which could be something like a spreadsheet or notebook.
How Can You Tell Serious Buyers from Window Shoppers?
While you won’t be able to tell if a home buyer is totally dedicated to a home sale until a strong offer is made, these are some tell-tale signs of a serious buyer:
They’re preapproved or prequalified. Preapproved buyers have gone through a thorough credit check with a lender and know what they can afford. Pre-qualified buyers are also good, but the pre-qualification process is easier.
They’re a cash buyer with proof of funds. Cash buyers can make strong, non-contingent offers. Serious cash buyers will provide a letter from the bank saying they have the money to make the sale happen.
They have a good agent. Serious buyers will have an agent because they want to get the best deal possible. Since agents don’t want to represent a buyer who can’t close, they’re unlikely to work with people who can’t afford to buy.
While serious buyers tend to have a real estate agent, FSBO sellers should be aware that negotiations may be tougher. According to a 2022 Clever Data Center survey of 1,000 homeowners, over one-third of buyers believed their agent could out-negotiate a FSBO seller.
We know home sellers hate to spend the additional 2.5–3% — it’s the main reason why sellers consider selling FSBO. But selling FSBO is not only difficult, it usually means you won’t get top dollar for your sale. Research from Collateral Analytics, a real estate analytic product company, found that FSBO homes sell for about 5.5% less than comparable agented homes. That difference more than wipes out the 2.5–3% seller’s agent commission.
Following Up With Prospective Buyers
The best way to stay in contact with prospective home buyers is by sending them a quick email or text when something about your listing changes. Don’t call unless they told you that’s how they prefer to be contacted.
Here are a few situations where you may want to reach back out to these potential buyers.
1. When You Receive an Offer
If you receive an offer, you can contact potential buyers who have previously walked through or inquired about your home to let them know.
The idea here is to encourage additional offers and spark a bidding war. Buyers who are on the fence may feel like they should bid if they’re having a tough time finding other homes.
💬 What to Say:
“Hi! We just wanted to let you know that we’ve received an offer on the house. We haven’t accepted it yet, we’re just reaching out in case you’re still interested.”
Pro Tip: Keep it short and sweet!
2. If You Change Your Price
If a buyer had your home on their shortlist but felt they were priced out, they may be eager to put in an offer once they hear about a price drop.
💬 What to Say:
“Hello! We thought you might be interested in knowing that we’ve dropped the price on our home. Please let us know if you’re interested in coming back and taking another look around!”
Pro Tip: Invite them to check out the house again!
3. If an Offer Falls Through
It’s frustrating when a deal fails, but it happens. According to the National Association of Realtors, about 7% of all real estate contractsfell through in early 2022.
If that happens to you, you’re almost starting back at square one — but if you’ve kept track of potential buyers, you’re in slightly better shape. You’ll want to reach out and notify all those leads that your home is back on the market.
💬 What to Say:
“Hi! We just had an offer fall through and wanted to reach out to see if you’re still in the market. Please let us know if you’d like to come see the house again!”
Pro Tip: Don’t focus on why the deal fell through. Just tell them the home is back on the market!
4. If Your Home Isn’t Attracting Enough Offers
If you aren’t getting enough offers, you may want to reach out to those who have toured your home — these buyers are the best source of feedback you can find.
Ask these buyers what they thought of your home and if they made an offer on another property. Ask them what they did and didn’t like about your house, including thoughts on price. This type of feedback can help you adjust your marketing strategy.
💬 What to Say :
“Hi! We noticed you toured our home and are looking for feedback. Is there anything you liked or didn’t like? Were there any questions you had about the home?”
Pro Tip: Encourage honesty, and don’t get defensive!
The Best Way to Stay in Touch With Prospective Buyers
Not all buyers will want to give you their contact information, and some won’t be willing to share what they did (or didn’t) like about your home. Be courteous even if you receive a curt reply, and don’t follow-up multiple times if you don’t receive a response.
FAQs About Prospective Buyers
What is a prospective buyer?
A prospective buyer is anyone who might want to buy your house. When selling a home for sale by owner, you’ll want to keep track of these prospective buyers to follow-up when something about your listing changes, like a price drop. Learn more about prospective buyers.
How can you tell if a buyer is serious?
Serious buyers will be preapproved or prequalified if they’re using a home purchase loan, or they will have proof of funds if they’re a cash buyer. Almost all serious buyers will use an agent because it costs them nothing. See more signs of a serious buyer.
How do I find prospective buyers?
The best way to find prospective buyers is to list your home and keep a log of who tours it. Then, you’ll need to collect contact information from buyers (or their agent) and ask them for feedback when the time is right. Learn more about how to find prospective buyers.