by Dan Wolf
on Friday, June 29th, 2012 at 2:01pm.
On any given Sunday, you'll see Open House signs on the street corner of good neighborhoods. Everyone knows you can follow the signs to the house and view it easily during the open house.
Open Houses are, at the least, a tradition; but do they actually sell houses? Well, that's a debatable subject depending on who you are talking to. If it has been 10 years or longer since you were a buyer looking for a home, you might be surprised how much things have changed in marketing of real estate. According to the National Association of Realtors back in 1995, only 2% of polled buyers reported the Internet as instramental in the home they purchased. My, how times have changed! In 2009 94% of buyers said their first exposure to the home they ended up buying was from an Internet search!
On a related subject, is the huge way print advertising and buyer habits have changed. Today newspapers and printed monthly magazines account for very few sales, where 10 years ago the newspaper was where a lot of people started their property search.
Today, again from the National Association of Realtors, who track these things annually, less than 2% of homes sell as a result of an open house, slightly behind print adverting in effective ways to sell.
Today, the Internet is the preferred way to see a house for several reasons; you can shop from your couch at home to pick the home and agents can display good photo's and virtual tours easily and inexpensively as opposed to print media which is limiting and much more expensive. In truth, by the time the buyer gets to the front door, it's is probably the second showing - the first being online, or a virtual showing!
The combination of good quality photo's and virtual tours and accurate property listing and description go much further in creating buyer interest in the property.
Open houses lend themselves to hosting "tire kickers" and neighbors as well as the occasional person who is looking for decorating or remodeling ideas and not a buyer.
Another reason experienced sellers prefer to restrict open houses is a security issue, or actually the lack of security. Experienced sellers know that ANYONE come through the door at the open house. That means the buyers probably aren't prequalified yet and might be able to roam the house. If more than one party are in the house, the hosting agent might not be able to be with both parties, leaving some alone in the house.
So, why do agents work open houses? There are several reasons. In new construcion homes, open house are effective. The agent knows the builder and can talk about the finishes and construction timing and other aspects of the sale. Some buyers have to sell their previous house and may have the opportunity to do that while the new property is under construction. Another good reason agents like to open house is so that agent can be in contact with potential buyers. Even if the buyer can't buy the house you meet them in, the agent can take them to other homes that may be closer to fitting the buyers needs.
Would a Realtor open house their own home? Most likely not. Most agent agree that you might be able to meet buyers for other properties, the odds of finding a buyer for the house you are working is remote. Many agents now refuse to hold open houses and consider them to be a waste of time and even a security threat - and most sellers prefer the buyers to be prequalified before allowing folks into their home.
If you are buying home, touring open houses might be a fun pasttime on the weekend, but the most efficient way would be to pre-qualify for a loan first, then meet with me or an member of Wolf Real Estate Professionals to talk about your desired home parameters and then scheduling to see property that meets your criteria. That way, you'll learn the market and get a home that best meets your criteral at a price that works for you!