hold a lot of open houses. And I have a lot of reasons for holding
them. Some of the reasons help me more than they help my sellers. But
after I disclose all of the pros and cons about open houses, most
sellers in the Twin Cities real estate market see a number of benefits
to having open houses, and listing their home with an agent who holds
lots of them.
But first let's talk about the benefits to me. I held an open house
last Sunday from 1:00 to 3:00. My seller spent the entire morning
cleaning the house and doing all of the things that my home stager
suggested. Seven groups of people came through the open. But not one of
them was interested in writing an offer on this property. A look at my
notes reveals that the first two groups through were "nosy neighbors"
who were only interested in what they will be able to get for their
homes in the next year or so. Next I met two people who were "just
looking" and have no interest in buying anything any time soon. I also
met two couples who were just getting started looking, and expect to be
getting more serious in about four months. Finally, I met one single
woman who loved the home, wants to buy something soon, but only
qualifies to buy homes in a significantly lower price range.
So I gave up a good chunk of my Sunday, and didn't sell anything.
But I did meet five different prospects who could be a source of future
business for me. Unfortunately, as useful as they are to me, they are
much less useful to my seller. In fact this is why many sellers and
also many agents don't like open houses. Sellers especially are
beginning to see them as a waste of time and effort on their part. They
believe, for some good reasons, that their agent doesn't see much
chance of Twin Cities open houses leading to a sale. And that many
agents just use open houses to capture more leads.
So how did my seller benefit from this open house, and why is she
excited to have me hold more of them? Well first of all she came home
to a really clean house!! Which isn't as trite as it sounds, because a
private showing was scheduled for the next morning, so she had to clean
it anyway. More importantly, her open house was advertised in the St.
Paul Pioneer Press, the Twin Cities MLS, and hundreds of websites,
including our competitor's websites. So sellers are able to get a lot
of exposure by having an open house. Many of the best, most motivated
buyers are already working with a buyer's broker. So they might notice
the open house on realtor.com, or my website, or a competitor's website, but then have their agent arrange a
private showing. It is hard to track this kind of data for Twin Cities
open houses, but I believe my sellers get more private showings in the
days immediately following a well advertised open house.
The feedback that agents receive at an open house is also very
valuable, provided you know what questions to ask. Of course I prepared
a CMA before we listed the home, and I had a professional home stager help us get the home ready for showings, so my seller and I already
knew what we thought of the home. But it's always good to hear the
opinions of people who can be completely impartial. For example, the
two "nosy neighbors" have looked at every single home that has recently
been for sale in their neighborhood. I used many of those homes as
comparables when preparing the CMA for my seller, but of course I
hadn't physically been inside every one of them. The nosy neighbors
felt that my listing was a cleaner, more updated, and a better value
than the other homes they had seen. I got similar responses from the
other people who came through the open, and it helped my seller and I
feel even more confident that we are priced where we need to be.
Similarly, when you host a well advertised open house and nobody comes,
you need to be prepared to find out why that happened. It is no fun
telling a seller that nobody came to their open house. But it is one of
several factors I look at when trying to help sellers decide if they
are appropriately priced. And the bottom line is that if nobody comes
to your open house, it might tell you more about what you are offering
than it does about the concept of open houses in general.
I think many of the people who say the most negative things about
open houses, have been trying to use them to do something that can't be
done. In today's real estate market in the Twin Cities, over-priced
listings just don't sell. Holding an open house on an overpriced
listing will not sell it, no matter how innovative the advertising.
Instead of saying the open houses didn't work, these sellers should
realize that their unsuccessful open houses gave them some valuable
insight into what they need to do to get their home sold.
So back to my seller. She is convinced that we are well priced and
that somebody is going to buy her home. And she wants to expose her
property in as many ways as possible including open houses. Finally,
she knows that I do two more things that help me sell more than my
share of open houses. First of all I charge a discounted real estate commission which allowed my seller to price her home attractively; so I
am holding an open house that has a real shot at selling. Secondly, I
charge even less when I can sell my listing myself and not have to pay
a buyer broker. This means that my seller could save enough money to
enable her to accept an offer that she would find unacceptable if she
were paying a larger commission. Even in this slow market, the Twin
Cities are full of buyers who just can't quite afford the kind of home
they want. When one of these buyers comes through an open house of
mine, I get them to put their offer in writing. Then by charging my
sellers several thousand dollars less than they would otherwise have to
pay, often I can put together a transaction that works for everybody.
Bottom line: If your home is overpriced, you could hold it open
every day for the rest of your life to no avail. On the other hand, if
you are trying to price your home competitively, an open house is one
way to expose your home, get you some helpful feedback, and maybe find
a buyer for you!!