“Tradition, tradition,” cries Tevye in Fiddler on the Roof. He wasn’t singing about Realtor open houses, but he might as well have been. Open houses are a longstanding tradition in the real estate business but in these days of marketing through social and electronic media, they seem to gradually be disappearing from the landscape. Posting a virtual tour on YouTube is easy and time effective, but is it enough? Where does the traditional open house fit as part of your overall marketing strategy?
Let’s take a look at some key questions and some potential answers.
- Who benefits from an open house?
- What situations call for an open house?
- What are the downsides to an open house?
Who benefits from an open house?
Some Realtors feel that homeowners expect an open house as part of the overall marketing campaign. In a recent survey conducted by Texas A & M University, 97 percent of the Realtors who responded said they held public open houses, but only 41 percent believed that an open house helped them sell that specific home. Apparently open houses do attract many potential buyers, but most Realtors feel that those buyers are more likely to buy a home other than the one that’s open, and that most people attending open houses aren’t serious buyers at all.
So if the seller is not benefitting, who is? For starters, a sharp Realtor can use an open house to attract buyers for other homes. And an open house creates opportunities to get listing agreements with neighbors who stop by. More than 50 percent of the Realtors responding to the A & M survey indicated that open houses helped them generate new listings.
What situations call for an open house?
If your listing is unique or unusual in any way, an open house may be a good strategy. For example, you may have a historic property with features and fixtures that can only be appreciated up close and personal. You want prospective buyers to appreciate the patina on the woodwork or the Tiffany stained glass windows, and a YouTube video just won’t do it justice. Or perhaps your property is in a particularly picturesque location, with an ocean view, or a creek in the back yard. You want the buyers to see the waves splashing on the shore and hear the stream trickling over the rocks.
Then there is the broker open house, which many brokers still consider an effective tool. Usually done when the home is first placed on the market—often with lunch or decadent desserts included–it can attract other Realtors representing buyers who are looking for that particular kind of property. Here again, however, there are downsides. Broker open houses don’t always attract the top Realtors, because they are too busy. They are spending their time with active buyers and sellers, rather than previewing properties. So unless they are in need of a free lunch, they may be no-shows.
What are the downsides?
Realtor safety is a big issue in almost any market these days, and one we have discussed in detail in another article. Horror stories abound, from lookers who steal drugs and jewelry to Realtors who are victims of sexual assault. Of course you’ll be present for the duration of the open house. But you can’t be in every room all the time, so if multiple visitors are present, you may find it difficult to control the situation.
Whether or not to hold a house open may come down to the nature of the relationship between you and your client. If your client pushes hard for an open house, then it may be worth doing to keep the client happy. You may also want to have a good marketing strategy outlined, so you can show your client how you can be effective without an open house.
If your real reason for holding an open house is to meet potential clients and get new listings, how do you think your client will feel about that? You’re asking her to get her house into pristine condition and then disappear for four or five hours while you use her home to attract other sellers? Maybe not such a good idea.
Finally, you need to think about what other deals you might be missing while you’re spending your Sunday afternoon sitting at your client’s property, hoping the perfect buyer walks through the door.
Whether or not to hold a public open house depends on three things: whether the property dictates it; whether the client relationship requires it; and whether you have time for it.
When it’s time to decide, ask yourself the tried and true question recommended by many time management gurus: “What is the best use of my time right now?”
— Richard M. Hartian (@WinningAgent) July 13, 2012
So what do you think about open houses? Do you hold them? Do they benefit the client? Leave a comment below.