Across time and space, man has been faced with a few questions so profound they span across generations: What is the meaning of life? Is there a God? and, of course, Do Open Houses work?
Well… while some questions are easier to answer than others, not everything is as black and white as we might like. We might never know the answer to existential questions, that doesn’t mean that we can’t try to learn as much as possible about what is, actually, understandable.
If you’re selling, or thinking about selling your house, chances are you’ve thought about the marketing aspect and wondered – Do open houses work?
Today we’ll learn about the ins and outs of open houses and answer the age old question “Do open houses work?”
What is an Open House?
An Open House is “a time when sellers open their home so that numerous potential buyers can swing by and check it out with no appointment necessary” (according to Realtor.com).
Some of these people might include: neighbors, people passing by, nosey-neighbors, real estate agents, and possibly homebuyers. They all might have a different objective and be interested at a look inside your home. However, keep in mind, not everyone who wants to take a peak has good intentions.
Why host an Open House?
Marketing your home, highlighting the best features, and capturing enough legitimate attention to bring a seller a buyer is the main purpose of an open house.
If the seller has a listing agent, hosting an open house might be an expectation set by the seller(s). Most sellers paying someone a listing commission are likely to expect the listing agent to increase interest in their property and bring a valid buyer. Hosting an open house is one way to accomplish this.
If a seller chooses to go the For-Sale-By-Owner route, instead of using a listing agent to market their property, they still might want to host an open house, too. If you are, or are thinking about selling For-Sale-By-Owner, there are resources, like Flat Fee MLS services, available to increase the odds of finding a buyer.
Who benefits from an Open House?
Agents – If you have an overly enthusiastic agent about the desire to host an open house, there may be more to the enthusiasm than meets the eye. As a seller, you should know that listing agents benefit from open houses, too. During an open house, agents can use this time to meet new, prospective homebuyer leads and grow their business. A good agent will keep talking about the benefits of your house instead of only just using this time to promote themselves. Make sure you have someone you trust. For agents, promoting your house, while marketing themselves, helps them accomplish two tasks at once.
Sellers – The homeowner might benefit from an open house if a buyer comes about as a result. However, don’t expect it to happen. Some argue an open house is just lost time as most homes are bought during private showings. However, if you do host an open house, this is an opportunity for you to have set aside time to clearly stage, market, and tidy up your property.
Buyers – When is the last time you made an impulse purchase? Chances are you aren’t going to do this with a house by strolling in on a Sunday afternoon. The buyer could benefit from an open house if it just happens to be the house of their dreams. However, be prepared ahead of time that this scenario is unlikely.
Do Open Houses Work?
Open houses have the potential of boom, but they can also bust. Your success depends on previous preparation.
Do Open Houses Work? – Yes, if you…
- Place open house signs on the corner, near busy intersections, attach strings of balloons to your mailbox, and use large arrows pointing towards your direction. All of these ideas can draw the attention of those physically nearby to your home. It’s also a good idea to advertise online, post in buy-sell-trade groups on Facebook, or take out an ad in your local paper as if it were 1986.
- Make Room – Move everything out of the driveway to make it look as open and inviting as possible.
- Light – Open blinds and let natural light in. Turn on lamps and make the property seem bright.
- Repairs – Now is the time to perform make-ready repairs on all those minor things you’ve neglected over the years.
- Cleaning – Did you just pay to have the carpet cleaned? Rather than asking guests to take off their shoes, consider putting booties at the door, or get a roll of clear carpet protector to make a path.
- Paperwork – Having information readily available with statistics and info-graphics about the property and neighborhood is a benefit.
Create Social Proof
- Tom Postilio, a luxury broker in New York from the aforementioned Realtor.com article, explains, “It’s no secret that many buyers wouldn’t trust the word of an agent who is excited about a property, but it’s hard to deny strong interest when people are bumping into each other at the door.” A carefully crafted open house can have a huge positive impact on buyer psychology and FOMO – Fear Of Missing Out.
- How will you make your home stand out? An inflatable T-Rex? Using Snapchat Geofilter, or Instagram Hashtags?
- Only you, and those familiar with your home, have the knowledge about the best benefits of your home. You know what they say, if you got it, flaunt it. Do you have a solarium that would make a great play room for the kids? Show it. Talk about it. Is the location of your home in an area with excellent schools? Consider putting out pamphlet of the local school, or make a flyer and/or info-graphic about the benefits of the neighborhood.
Index Card Method
- It’s no surprise that when someone is engaged in activity they are more likely to retain information and have a better time doing something. You can take advantage of this by applying the Index Card Method. As you greet people at the door, you can hand them, a small clipboard, pen/pencil, and an index card. Encourage visitors to write down 3-5 aspects they like and don’t like about the house. Then you can receive timely feedback on their way out the door and not be stuck wondering what someone thought.
Do Open Houses Work? – Not if you…
Have the wrong agent
- Some hairstylists are better than others, some mechanics are better than others, and in real estate, some agents are better than others. Smart agents would try to provide the best big picture of the home year-round, they might suggest posting photos of the home in a variety of seasons. Poor agents won’t have too many ideas.
Put in half-effort
- Buying 1-2 $1 balloons at the dollar store, and a cheap Open House sign to display in the lawn, that blows in the wind, likely isn’t going to get you the kind of attention you want. Sure, it’s a seller’s market. But, balloons, or anything halfway done, won’t sell your home.
- Put simply, if the price isn’t right. People won’t go. The ones who do attend, if any, aren’t likely to put in an offer, and you’ll feel like your time could be better spent elsewhere. Has you agent done a Comparative Market Analysis?
Get too personal
- If you’re like most, you don’t like when you walk into somewhere and a pushy salesperson is talking your ear off the whole time and following you around like a lost puppy. Give the lookers some personal space, and remind them that you’re available to assist if they’d like. That being said, asking a few open ended questions to learn more about what they’re looking for can help you navigate the conversation, too.
Go way over the top
- Playing music that is too loud, using too much air freshener, and appearing desperate in your approach are all elements that could turn off potential buyers. The strongest position in negotiation is the ability to walk away and mean it.
Choose the wrong day
- If it’s a cold and windy day, buyers are unlikely to be out looking at houses. Plan days in advance and choose a Sunday where you’re expected to have ideal weather.
Worst case scenario: You don’t get any offers, only a few show up, and you feel like it was a waste of time. However, if you use the index card method above, you’ll at least get feedback about the perception of your property, and how to market moving forward.
In the end…
Unless you live in a high wage and low cost of living area, chance are selling your home with, or without a realtor, might be a challenge. But, If you’re holding an open house in a high demand neighborhood where inventory is low, you are most likely to have the highest rate of success.
The whole point of an open house is to market and stage your property properly to entice a potential buyer. As a result, being creative, and knowing the best features and benefits of your property to highlight is your best bet.
Today we’ve answered the question, “Do open houses work?”, and we learned that with proper preparation and approach, you can get the most out of the experience.
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