As I prepare for another Sunday open house, I thought I’d share some thoughts on this age old practice and pose these questions: Is it worthwhile holding an open house? And does opening your home to the public actually accomplish anything?
To answer this we should first ask, to whom am I directing the question? If I am asking the real estate agent the question, the answer is almost always, yes. Why? Simply, an open house is a great way for a Realtor to get in front of potential clients, collect their name and contact information, and hopefully pick up some new business in the process. I held an open house last Sunday at a new listing of mine and I had no fewer than 50 groups through. 50! That’s a lot of potential clients; a veritable gold mine for anyone in the real estate trade. But you may ask, “How is that in any way a benefit to the seller?”
Aside from the obvious hassle of having to vacate your home for an entire Sunday afternoon, holding an open house means added work for a seller. As you can imagine, there’s the cleaning and primping to show your home in its best light. However if you are serious about selling, you should be doing this daily anyway. OK, so prepping isn’t unique to a day of an open house. You will have to take a moment and secure your valuables. After all, even the most observant Realtor can’t be in all rooms at all times and I’m not just talking cash and jewelry either. Pharmaceuticals are often the target of open house visitor-thieves. If you are a senior and you have a lot of medication storing those meds can be a real hassle. As an FYI, do you know what the number one medication stolen out of homes for sale is? You’re thinking Vicodin aren’t you; well according to the National Association of Realtors it’s not Vicodin which is #2, rather it’s Viagra. I guess the would-be thieves figure a seller isn’t going to run to their agent and say, “Someone’s stolen my Viagra!” OK, so security is an issue. In addition, there are also the dirty feet and shoes that will be all over your freshly cleaned carpets. So getting back to the initial question, is there really a benefit to a seller in holding an open house? Sorry sellers, the answer is yes and they’re what I call, “Free Agents”.
In this day and age where “information all” is available on the internet, a new-old phenomenon in real estate is happening. It used to be, back in the day, that the only way a house hunter could learn about available homes was through a Realtor. Armed with a newsprint book, updated weekly, real estate brokers controlled the listing information and the consumer had no choice but to call upon the real estate agent to access that data. Thus the only way for a buyer to circumvent that process was by visiting open houses. Follow the signs; that was the mantra. So what’s different today? Well obviously the data of available homes is out there for all to see. No more MLS book that only the Realtor has. But here’s where it gets interesting if you are a seller. Because the information is there, many of these house hunters prefer a home search where they are in control not the real estate agent. To stay in control, savvy buyers are gathering listing data online but even with that knowledge, they still can’t see a home on their own; they remain dependent upon a Realtor unless… they can visit an open house. See, “Free Agents” don’t necessarily start their hunt with a Realtor. They often want to do their own due diligence and research, especially in the beginning of their search. Remember, this is the generation of computer comfortability and Free Agents like to research on their own first. So by holding an open house, you allow these quality buyers access to the one thing the internet does not, the home itself.
You might argue, and many sellers believe this, that quality buyers will have representation. And while this is in fact true, it’s really an issue of eventuality. This is because the buyers I’m referring to, while serious, are not quite ready to work with an agent so they don’t have representation, yet. Most of us shoppers have a fear of sales people (think used car salesman in a plaid leisure suit) and that fear is that a “sales person is going to sell me something”. Free Agents often fit this category. Perhaps they had a bad experience or perhaps they just feel they are smart enough to research homes on their own. Regardless, they want to see the inside of a home and an open house is the only way they can do it without engaging a real estate agent. One point that I’d like to make is this: house hunting is not an issue of intelligence, but rather one of experience, market and neighborhood knowledge and frankly just knowing what to look for. This is why people hire me to help them find a home for them. They know that I have those attributes and they trust me to help them buy the right home, and most importantly, not make a very costly mistake.
This brings me back to the Realtor liking open houses because it’s a great way to pick up good client-prospects by impressing these free agents with market knowledge. So here it is in a nut shell, open houses are good because the Realtor holding it gets a chance to impress and pick up new clients; the seller has someone trying to make a connection with Free Agents who may well be their buyer and the prospective buyer gets a chance to do some hands on research before engaging the expertise of the real estate community. In Negotiating 101, this is called a win-win-win. The seller wins, the buying public wins and the Realtor wins. That said, I better hurry, I’ve got an open house to get to!