When it comes to listing your home, the idea of an “Open House” will most likely come up in a conversation with your listing agent.
When the weather turns from Winter to Spring and Summer, newspapers and signs start appearing promoting the latest Open House opportunity – usually on a Sunday – but they’re not always the right choice when selling a home.
Here at Solutions, we don’t always encourage them, and here’s why.
A Seller might think an Open House will get the word out faster about their house to potential Buyers, but with the sheer speed of the Internet the word is out all around the world, and interested Buyers on any of the popular real estate websites instantly know your house is available and will start to email or call in within minutes of it becoming officially “Active.”
Are Open Houses still useful?
Despite all the changes technology has made in how houses are bought and sold, however, one standard feature of the process remains… the Sunday Open House.
Shortly after a house goes on the market, many listing agents will set aside a Sunday afternoon to welcome prospective Buyers (plus nosy neighbors) to see the house at its best.
But has the Open House outlived its usefulness?
It depends on whom you ask. Some agents believe modern life has rendered Open Houses unnecessary, while others believe they’re more important than ever.
New construction is one area in which the “Model Home Open House” is the best way for Buyers to envision what a new house will look like beyond the empty lot.
Houses in rural areas, however, might not benefit from an Open House as they’re more difficult to get to and planning a weekend when Buyers are available to make the trek can be difficult to predict.
Many listing agents feel an Open House makes the Buyer more comfortable about not having to make an appointment as many weekend lookers want to see a house NOW, and don’t want to have to wait 24 hours or until a tenant or Seller can be reached. These may very well be the ones who find their perfect house by chance when they see the Open House sign.
Open Houses help the listing agent
In reality, Open Houses are used by listing agents to do a couple of things:
1. Make a Seller happy (the Seller thinks this will helps sell the home); and 2. Get additional Buyer clients for the listing agent (this is done a lot more than Sellers have any idea).
What may be a real shocker is the fact that less than two percent of all homes sold nationally are a direct result of a Buyer visiting an Open House unaccompanied by an agent.
If you’re a Buyer, ask your agent to assist you in seeing homes, especially those that are available on any given weekend.
At an Open House, it’s difficult to talk openly about what you see because you’re within earshot of the listing agent. You will have to step outside to talk freely, which makes setting an appointment a much better option.
Real Buyers are with real estate agents who schedule appointments. The people who come through your home on any given Sunday Open House aren’t likely going to be the ones opening up their checkbook and handing over an escrow deposit.
Searches start online
More than 90 percent of Buyers start their searches online, according to the 2014 National Association of Realtors’ Profile of Home Buyers and Sellers, and the photos and videos let them rule out many homes without having to visit.
Open Houses, however, do help give an idea of what a neighborhood is like from the inside. A decade ago, visitors had questions about neighborhoods and schools, but most Buyers today have answered those questions with Internet research and are ready to see specific homes.
There are no reliable statistics on how many home sales occur because of Open Houses. The 2014 NAR Profile of Home Buyers and Sellers found that 9 percent of Buyers found the home they purchased from a yard sign or open house, down from 15 percent in 2001. But the data didn’t split out yard signs from Open Houses.
A lot of Buyers are relocating and searching from afar. The photos and virtual tours provided with many listings may take the place of Sunday drives through neighborhoods, but an Open House while a Buyer is visiting an area they’re not familiar with might help seal the deal.
How to Host an Open House
If you’re expecting several offers because your house is in a great location and has been priced correctly, hosting an Open House and stating you will not accept appointments or accept offers might help bring more offers out of the woodwork, or it might not.
It all depends on how much inventory is on the market. In places like Charlottesville, where the inventory has been very low as of late, this tactic might actually help some listings, but it isn’t common.
Keeping a home secure during the Open House is very important. Valuables should be put away, and prescription medications secured, along with any money, jewelry, and blank checks, and not just stashed in a drawer.
For Open Houses to be effective, they also have to be sufficiently advertised, both online and with yard signs at major intersections as well as in front of the house, so people can follow the signs in from the main road.
The home should also to be well-staged, with both the owners and their personal photos out of sight so the prospective Buyers can envision themselves living there.