There is a common misconception among many home owners regarding the effectiveness of open houses. While many people have their opinions, we are going to give you statistics, tell you who attends and why, and offer our analysis.
Here is a chart we show our sellers when discussing open houses ( source – National Association of Realtors® ):
We share this to let them know the likelihood of a buyer actually purchasing their home at an open house. Obviously, the odds aren’t good. The popularity of the Internet along with cooperation from other area agents have become more integral over the last 10 years. Even though agents today put more focus on “being where the buyers are”, open houses are still a form of marketing used in most markets with varying degrees of success.
WHO ATTENDS AN OPEN HOUSE?
Typically, the people who go to open houses can be categorized one of four ways: buyers who are just starting the process, neighbors, people who simply like to see houses, and people who are looking for an agent.
Most buyers who are beginning the process go to open houses just to “check things out”. It is an easy way for them to learn the market without having to commit to making an official appointment with an agent. Many of these buyers have yet to be approved for financing and some also need to sell their current home before they can buy. For the most part, they are not ready, willing, and able buyers. The serious buyers will likely hire an agent, who will show them homes through the formalized showing procedure.
Neighbors also love checking out homes in their neighborhood. Some often do so because they also may be selling soon and like to check out the competition. Others are simply nosy and like to see how the home is decorated. There is something to be said though about having the neighbors see your home as they may know someone who would love to move into the neighborhood. They can be an effective silent sales force.
There are also people who enjoy driving around on a nice Sunday afternoon looking at houses. These folks are less likely to be buying or even know anyone who would be interested in buying your home.
And finally, although you wouldn’t realize it, some people actually go to open houses to meet real estate agents. They don’t always identify themselves, but they do ask a lot of questions and “interview” us to see how we conduct ourselves.
WHY HAVE AN OPEN HOUSE?
There are a lot of reasons to have an open house, many of them however benefit the agent or agency. This may come as a shocker to some, but open houses can be better for the agent and/or their company than for the actual seller.
While an open house typically won’t bring in a buyer for that particular home, the people who do attend may be buying or selling a home some day. Therefore, open houses can be a great way for an agent to get business. Think of it like a fisherman putting bait on a hook. The agent uses the house as the bait to reel in new clients. They company benefits as well.
Some real estate firms love open houses because they bring added exposure to their company. Many brokerages still love running big open house ads in the Sunday paper, not necessarily for the benefit of their agents or sellers, but for the branding of their company. Having a lot of directional open house signs throughout an area also gives a company good exposure. Many agents are actually pressured by their company to have open houses every Sunday for this very reason.
ARE OPEN HOUSES WORTH HAVING?
This is the million dollar question. I suppose it depends on a lot of variables. Some areas of the country like Florida, that are popular for second homes, see more success with open houses. In these areas, open houses can be a major part of an agents’ marketing plan. In other areas though, it is not the best way to reach potential buyers.
As a seller, you need to decide if you want an open house. While they can offer some value they also come with inconvenience and risk. You will likely spend quite a bit of time cleaning and preparing your home. Also, you will be expected to leave your home for a few hours on a Sunday afternoon, not always an easy task for some people.
In addition, since open houses are public, there will be strangers walking through your home. Potential thieves and drug addicts, who lately have been known to steal prescription drugs out of medicine cabinets, are known to attend open houses. They can also be dangerous for an agent, especially if the home is vacant or isolated from other homes. There are many documented cases of agents being attacked while working an open house.
Personally, we have never sold a home at an open house. However, we met some of our best clients through open houses and recently got a listing because the seller “interviewed” me while I was holding her neighbors home open.
When all is said and done, a seller and their agent need to have an honest discussion about the real value of open houses in their particular market and determine if they are worth having.
About The Authors
The above information pertaining to Cleveland Real Estate News was provided by The Schuman Team, Amy and Dan, of Howard Hanna. They are Solon residents and can be reached at 216-346-3235 or via email, email@example.com or firstname.lastname@example.org.
We service the following Cleveland area suburbs: Bainbridge, Bay Village, Beachwood, Bentleyville, Chagrin Falls, Cleveland Heights, Gates Mills, Highland Heights, Hunting Valley, Lakewood, Lyndhurst, Mayfield Heights, Mayfield Village, Moreland Hills, Oakwood Village, Orange, Pepper Pike, Shaker Heights, Solon, South Euclid, University Heights, Westlake, Woodmere.
Open Houses – Do They Really Work? is the property of The Schuman Team and may not be duplicated or used without their written consent. ©February,2011