Are Open Houses Overrated?
I recently held an open house for a contemporary home at the last minute, posting it online on Sunday morning only two hours before it started. I usually discourage people about open houses because they attract neighbors and suspects more often than prospects. Most open houses are only responsible for 1% of all home sales. That is why I generally preach against them.
But sometimes I think it will work well for facilitating traffic through. I was holding an open house primarily because we went on the market on a Thursday and by Friday I had 15 showings. By Saturday, I had 22, and by Sunday, I was up to almost 30 showings scheduled. So, clearly the demand for the property was phenomenal.
My holding that house open was a little risky. Popping it into the computer just two hours before I actually held it. But, would you believe that we had twenty groups through in 2 hours and almost all came from the online ad. The question is...did I sell the house because of the open house?
I held another open house in Potomac, MD for a spotless very updated home and it was fully furnished and beautifully appointed. I online advertised it two days in advance and over 60 groups came through - that was over 110 people altogether in just two hours. We generated multiple offers and sold for over list price. None of the buyers came from the open house.
It's really a facilitator to move traffic though quickly and not have the seller overwhelmed with leaving and coming back for showings.
Frankly, it's good for the seller when the house is vacant. It might not be so good if they've got all their stuff in there. It can be a problem. And so, we have to be very careful about how we hold open houses.
One property in Vienna, VA we listed for $600,000. It was a 1,548 square-foot single-family, four-bedroom, three full-bath house. It was pretty though not totally updated. The seller put one dollar in where we could get two dollars back. It had a big lot on a peaceful cul-de-sac location, which backed to the popular W&OD Trail. It's the Madison High School district, close to the metro, and it had all the amenities of downtown Vienna, just a few blocks from its tranquil wooded setting. New features were just added – carpet on the upstairs level, kitchen floor, appliances, lower-level flooring, neutral paint throughout – it was ready for buyers to come in and purchase. This lovely home had very pretty things on the inside as well. So the question the seller had was, "Do we wanna have this house open?"
Open houses attract three groups of people:
- Neighbors – right? you might even have done this!
- Suspects – the people who aren't really qualified to buy, but are gonna be able to come through because the house is open and you can't say no, you have to treat everybody the same, right?
So the client and I have the conversation, "Do we have this house open or not?" One of the suggestions I make, when I'm having an open house, is maybe to consider having a “neighbor's open house” a half an hour before we do the public open house. So, deliver an invitation to the neighbors and say, "Neighbor's open house" at 1:00, and then the open houses starts at 1:30. And it's neighbors only.
Now, why would I do that? Because I don't really want to have a party at my open house, where the neighbors are walking through or standing in the living room connecting with friends talking about their kids and what not. We don’t want this to happen in the middle of somebody else's open house when they're trying to sell the property. So, we can overcome that by having a "Neighbors-only open house" for the half an hour before we have the open house. That way the conversation can be controlled by the listing agent of the property and they can guide the neighbors in the conversation. But it also makes it clear to the neighbors to be respectful and be out by the time the public open house starts. We want people to come through and have an opportunity to look, who are really looking to buy it. As far as the suspects are concerned, it's not often that things are taken out of open houses, but it does happen, especially with pharmaceuticals.
Open House Problems
We do have examples in our own past where clients had their medicine taken. Oxycontin, Vicodin, things like that. It just happened to be that the sellers had left some of these medications in a medicine cabinet and someone took them.
There was an open house in Kenwood, a beautiful neighborhood in Chevy Chase, Maryland, where an agent with another company was having an open house. Apparently, a thief came into the open house, went upstairs into the master bedroom, and was sticking things into her purse. A neighbor happened to walk up to the master and looked through the door just as she was putting something into her purse. The neighbor said, "Hey. What are you doing?" She replied, "I was just putting something back in my purse." But the neighbor felt uncomfortable, went downstairs, and told the Realtor, about the incident. The Realtor was alarmed, of course, and went outside when this lady left and wrote her license plate number down. The Realtor called the police, because the sellers came home and found they were missing $15,000.00 in jewelry. They police tracked that lady to her house in Avenel, which is a high-end community in Potomac, Maryland. Apparently the lady had been arrested previously. They found a host of jewelry she had stolen from many open houses.
Now, it's not common for people to do that, but it does happen. And so, as a seller, you have that worry, right? "I got strangers walking through my house." You definitely want to put away your niceties and lock up you valuables, for sure, if you're going to have an open house. But I'm not against it. As long as you understand the risks and the rewards, the reward being 1% of home sales.
One other suggestion with larger well appointed homes, I will have two people manning the open house so we greet with one and then have another gathering names and info.
Online marketing is now the most potent means of delivering information.
Maybe some of you have bought your home at an open house. That's possible, but it's not that significant and important now. We use hundreds of websites. We use incredibly good photography, and hopefully good, well-written, articulate descriptions of the benefits. We use measured floor plans.
Floor plans are very helpful and good high resolution photos are a must. As one of my real estate mentors Floyd Wickman likes to say, a picture is worth a thousand dollars. I agree and think the online open house is much more important for the seller than the actual open house to the public.
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About Eric Stewart
Eric Stewart started his real estate career in 1987 and each year he and his group sell over 150 homes in DC, Maryland, and Virginia. The Eric Stewart Group has completed more than 3,000 real estate transactions, placing Eric in the top 1% of Realtors® in the nation. With a comprehensive approach to marketing and a knack for negotiation, the Eric Stewart Group has built a reputation of trust and tireless persistence throughout the area.