A Washington Post article titled "Online listings breathe new life into open houses" generated considerable discussion in the Yaffe Real Estate office.
According to the article, the open house is back as an effective tool for selling houses. Here are some of our thoughts.
How Effective are Open Houses if You Can't Qualify Those Looking?
The biggest issue with open houses is that you are opening your doors to the public. That means that you can't qualify people at the door regarding their motivation and financials.
So everyone can come in - tire kickers, neighbors, as well as criminals.
In our experience, open houses don't sell that many homes. We don't see that changing in the Internet Age even if, as the Washington Post articles says that,
"So you might be selling to people who walk in cold, but they’re not really cold (because of the Internet); buyers are coming in to open houses ready to make decisions right then and there."
We have found that those buyers who are serious and motivated have their financials in order and are working with an agent. These buyers value their time and only want to see homes that meet their needs - even though they start their home search on the Internet.
The job of a good real estate agent is to sift through the best homes for their clients after doing research and then set up appointments based on their clients' availability - not during an open house when others are around. Serious buyers want to be alone in the home with their agent, take their time and not be distracted by other people looking at the same time.
The Washington Post article says that open houses are on the upswing. Yes, I can see that. They can now be advertised better via the Internet and social media so more people show up. However, as stated before, whether these lookers are actually serious buyers is another question.
When is an Open House Effective? And For Whom?
We see that open houses are a great way for people at the beginning of their search to see homes. They can do research online, check out photos and come look at properties all without bothering an agent or a lender.
Open houses are effective for truly unique homes - historic homes, one-of-a-kind homes, homes that truly cannot be marketed online.
Open houses are also a great way for agents to secure buyer leads. In other words, open houses aren't primarily effective for home sellers.
For the safety of our agents and our clients, we prefer to qualify people prior to seeing a home. We think it is better for all parties involved - the homeowner, the agent and the buyer - and we make ourselves accessible to accommodate a serious buyer's schedule as much as possible.
In case you aren't totally convinced, here are a few other perspectives on the effectiveness of open houses for sellers:
- Is an open house a waste of time? explains that an open house is "better for agents than sellers." Furthermore, "only 2% to 4% of ... listings sell from open houses. It's not a necessity."
- Is A Real Estate Open House Necessary To Sell Homes? states that, "... you should be aware that when it comes to putting on a public open house, you might be wasting your time. With less than 2% of homes selling from public houses nationwide, the efforts of you and your Realtor may be better spent elsewhere." Furthermore, "Far more important than the promise of an open house is the reputation of your real estate agent. You can hold an open house or not, but it is more important to focus on the number of sales your agent completes each year, and how he or she is viewed in the industry. A good agent knows how to sell homes and is someone you can trust, even if you do not see what he or she does on a day-to-day basis."
That said, if you are determined to have an open house to sell your home, here are suggestions for Open Houses That Work.
What's your experience with open houses? Have you found them effective? Let me know in the comments.