‘ByOwner’ offers FSBO sellers options — and no commissions
With new owners and a new strategy, ByOwner.com hopes to attract sellers seeking DIY or flat-fee services via its “your lead” model and in-house brokerage.
Key points:
- The leaders of the FSBO-oriented firm, which has a presence in 46 states, believe they offer sellers a better approach at a fraction of the cost of listing traditionally.
- “It actually is a really sexy business,” says co-owner Colby Sambrotto, who previously co-owned ForSaleByOwner.com until it was acquired by Quicken.
- Their model includes “pure FSBO,” flat-fee listings, a brokerage arm and agent referrals. They also offer rental listings and hope to support other assets in the future.
For-sale-by-owner (FSBO) sales are a small but potentially valuable niche in the U.S. housing market, comprising 6% of sales in 2024, according to the National Association of Realtors. Two real estate entrepreneurs — Derek Eisenberg and Colby Sambrotto — are hoping to capture more of that market by offering what they believe is a better approach for FSBO sellers.
After purchasing ByOwner.com in 2023, the company's co-owners are looking to grow, recently launching a RegCF offering to raise capital. Eisenberg and Sambrotto spoke with Real Estate News about their sales model and how it differs from the rest of the market.
A 'sexy' business with near-national reach
While some in real estate view the FSBO business as "not particularly sexy," Sambrotto said — because "it can be perceived as being outside of the traditional real estate model in the sense that there aren't agents or commissions involved" — he believes that "once you take the time to learn it and the dynamics that drive it, it actually is a really sexy business."
Plus, ByOwner comes with something other FSBO websites typically lack: an associated brokerage arm. The brokerage operates in 46 states and Washington, D.C., and its leaders have their sights set on expanding to the remaining 4 states (Oklahoma, Wisconsin, Oregon and Montana) by the end of the year.
The brokerage is also a member of "every relevant MLS board in those states."
More options, better prices for sellers
Having an associated brokerage can make ByOwner a one-stop-shopping destination for FSBO sellers, Eisenberg explained in an email to Real Estate News. These types of sellers — who often end up exploring options beyond FSBO — are "better suited to a transitional migration," Eisenberg said.
"They try pure FSBO first which ByOwner.com has. Then they migrate to a flat fee or discount MLS model, which most of the time is enough to do the job and sell their home. In cases where that fails, which is most often the result of an unrealistic price, they look to be referred to a traditional local agent, which we have a network of as well."
ByOwner agents, according to the company's website, "are not commission-based, which therefore allows us to offer our service at drastically reduced prices." For sellers who choose other listing avenues, ByOwner offers an MLS-only option for $195 or a non-MLS option for $95. Sellers who list with ByOwner can save 95% in listing fees, the company claims.
A 3-part strategy
The associated brokerage is one of the "3 legs to the stool" that makes up ByOwner's business strategy, Sambrotto said.
The second leg is ByOwner's model, which is "more along the lines of Homes.com or the original Realtor.com from years ago before Newscorp bought them, which is to give the originator of the listing their leads," Eisenberg explained.
"If you're a seller and you're selling by-owner, you're gonna get your leads, but if you're a Realtor, and we're showing your IDX, we're gonna offer them to you before we go and sell that ZIP code to some strange agent like Zillow does," he added.
Supporting other types of assets
The third leg of the company's strategy is the brand itself. ByOwner as a name is more flexible than Sambrotto's previous venture, ForSaleByOwner.com (now owned by Rocket) and has allowed the website to also offer rental listings.
The expansion to rentals has, anecdotally, proven successful so far. While Eisenberg said he still sees more listings from owners looking to sell than to rent, Sambrotto noted that he has received more interest from prospective tenants than buyers in the past 12 months.
The owners hope to broaden ByOwner's reach to include commercial properties, automobiles and boats in the future.