The open house is ubiquitous in real estate sales. Lots of real estate agents conduct open houses, and many home sellers expect an agent to have an open house. But, like so many things, just because everyone is doing it does not mean you need to do it too.
The benefit of an open house is much less clear than most people realize. In fact, there can be downsides to open houses, downsides that really outweigh the benefits.
You can sell your home without an open house, and that’s really the bottom line! Avoiding an open house will not cause your home not to sell. An open house is an archaic form of marketing.
There are a lot of real estate agents who don’t want you to know this, but it’s the truth!
In fact, many Realtors hate when I discuss the fact that open houses are unnecessary to sell a home. They will argue online saying things like their real estate market is “different” or they have sold three homes in the last month from an open house. I say hog wash!
Over the years I have explained this to many clients. You know what happens? Most of the time the owners have a real sense of relief. Many do not want a bunch of strangers scoping out their home unless they are serious home shoppers.
The question most homeowners ask is, do open houses work to sell homes? Statistically speaking the answer is NO they do not, and there are serious drawbacks to holding them which is discussed below.
What’s imperative to understand is the same “real buyers” who will attend the open house will also schedule an appointment to see the home.
In other words, instead of holding an open house and having a mix of qualified and unqualified people roaming around your home – SKIP IT! You do not need an open house to sell your home in the digital age.
Problems With An Open House
The image most people have of an open house – where many qualified buyers pour over your home, making offers and eventually closing the sale you want so badly – is rarely accurate. There are several common issues with open houses that make them less than ideal.
Agents who push for open houses rarely ever discuss these disadvantages with home owners. Why do you ask? Simple – open houses are potentially excellent sources of prospects for a real estate agent.
Rarely, however, does an open house result in a sale of the property being held open. For reasons you will see below, it may be wise to avoid them all together. Is an open house necessary to sell a home? Not! If you hear an agent telling you an open house is needed during a real estate interview you should show them the door. They are lying!
What makes an open house not worth doing?
Out of all the people who see your open house and choose to come check it out, very few will be qualified to purchase your home. Open houses are truly “open”, which means anyone with a pulse can walk through your door and wander about your home. Nosy neighbors, couples dream shopping (for the home they may, just may be able to buy one day), random drive-bys and other home sellers looking to check out the competition – there are a lot of people who will come by that are unlikely to buy the property.
Only a few people are positioned to purchase your home. They must have the financial qualifications, be looking for a house like yours, and be interested in buying in the time period you are selling. Part of what makes hiring a top producing Realtor so necessary is that a great agent knows how to find these kinds of buyers. Good marketing identifies good prospects and gets the message out to attract those prospects.
Top producing real estate agents rarely ever hold open houses. The reason for this is simple – top producing agents don’t need to hang out in someone’s home prospecting for business. Want a good chuckle? Take a look at this RE/MAX video on open houses. It sums up very well how something that was popular in the 80’s is no longer necessary today. Like a bad wallpaper, open houses should be a thing of the past.
Frankly, they would be if they weren’t a benefit for a real estate agent picking up clients! If open houses were banned across the country tomorrow, there would be no fewer home sales.
A great agent also realizes an open house is never needed when you price a home correctly and do an excellent job of marketing.
Real buyers are on the internet looking for homes every day. When a serious buyer wants to see a home, they will call their agent and schedule a showing. It is as simple as that. Lots of agents, however, will try to convince you otherwise.
Outstanding real estate agents make sure their clients are pre-approved for a mortgage before going out and showing them homes! Do you want unqualified buyers visiting your home? People who can’t afford your home will be a segment of the viewers coming through.
Theft And Security Issues
The other major issue with an open house is that these events are prime opportunities for dishonest people to take advantage of you. Some visitors may steal from you outright, once they discover a chance while looking at your home. Even more worrisome are the visitors who are more patient and cunning – those who stake out homes for security flaws, or create security flaws (like unlocking windows), and come back later to exploit those weaknesses when you are asleep, at work or out of town on vacation.
You can read about more open house thefts at this AOL article. In my local area of Hopkinton Mass and Milford Mass, I know of two recent incidents where open house thefts occurred. In one home over fifteen thousand dollars of jewelry was stolen including a diamond ring. In the other home, a five thousand dollar painting was stolen right off the wall. In both instances, there were multiple parties in the home, and the agent could not watch everyone.
Does this sound like something you want to have happen to you? By having an open house, you dramatically increase the odds that it will!
Why Do Real Estate Agents Promote Open Houses
You might be wondering why so many real estate agents promote open houses so heavily. It is simply for three reasons: Prospecting, potentially double siding the sale and branding. It should be called the big open house lie.
- Prospecting – there is no denying that an open house can bring in people off the street that can potentially turn into clients for other properties.
- Double siding the sale – there is a chance someone may buy the home that does not have an agent. What agent wouldn’t want to get both sides of the deal making twice the money? The problem with this, however, is that this does not benefit the seller or buyer if the Realtor is a duel agent representing neither exclusively. Worse yet in many states, the buyer will have no representation going to the listing agent.
- Branding – owners of real estate companies love to see their agents spreading the company sign all over town on the weekend. A lot of open house sign is a lot of free advertising.
You Can Sell Without Opening Your Home To Everyone
It is possible to sell your home in a reasonable time period, and for a good price, without having an open house. You just need a few things, including:
An Exceptional Real Estate Agent
A quality real estate agent will be okay without having an open house. You may even find individual agents that encourage you to avoid an open house, as they know that open houses may do more harm than good. You can find such an agent if you are willing to put in a little time and effort into your search.
You don’t want just anybody – your sister’s boyfriend, the sweet lady from church, or a random real estate agent in the yellow pages. You want someone with a strong resume. A list of recent home sales, references for several satisfied clients, a proven ability to sell for relatively close to the original listing price (bad Realtors will tell customers the selling price they want to hear to get a listing, then eventually cave to a much lower price when the home doesn’t sell), a personality that you can get along with, an agent with a strong web presence and social media savvy, etc.
Identify the characteristics that are important to you in an agent, then interview at least three different prospects to find the right fit. Take your time – the individual you choose will be your partner in one of the biggest financial transactions of your life.
Once you have selected an agent that you can trust, do your best to follow his or her instructions. While you are the final word in all decisions regarding your sale, you want to let your real estate agent do what he or she does best, and avoid inhibiting your agent.
Fantastic Online Marketing
Over 90% of all homes are purchased via an online search – not yard signs and certainly not an open house. Any agent worth hiring is going to know how to market effectively over the internet. It never hurts to put up a sign, but the real leverage comes from selling online.
We are in the digital age where buyers spend a significant amount of time looking at homes online. When they see one, they like they call their real estate agent to schedule a showing. Rarely does a buyer say to themselves…..no open house, sorry not interested anymore. DUH!
Great online real estate marketing consists of three things:
- Exceptional photography and lots of it – The pictures that go up online of your home are the king of your marketing efforts. They must be good if you want your home to look appealing. You want rooms shot from multiple angles, at the right exposure, and establishing a perspective that makes them look their best. You want such good photos that the online buyer feels like they have already been to the home when they visit.
- Well thought out real estate listing descriptions – If photos are king, descriptions are queen. Many real estate agents fail to take the time to write compelling listing copy. They think it is enough to give the bare details and leave it at that. But it is not enough, not if you want to attract buyers. The descriptions need to describe your home in the best possible way.
- Real estate virtual tours and video – Buyers have come to expect virtual tours of available properties. Video has become increasingly popular for this reason. You want video posted to YouTube – a Google product that is the second most visited website behind Google. A sloppy video won’t cut it, either. You need a professional looking production, which takes skill but is worth the investment. Your Realtor either needs to know how to make quality videos or needs to have someone that can do it for him/her.
Here is an example of a professional video tour. A video tour should be a requirement when you are a selling a high-end home. Home buyers love the opportunity to be able to view a home this way. It gives them a great feeling for the property before ever stepping inside.
Deferred Showings – A Better Option Than an Open House
Do you want a better way to market your home than an open house? How about if I gave you a method that would dramatically increase the odds of getting multiple offers on your home? Would you be interested?
I am sure you are nodding your head YES right now! The concept is known as deferred showings. Deferred showings is a powerful marketing tool for sellers.
Here is how it works. You list your home on a Monday or Tuesday and don’t let anyone in to see the home until the weekend. Why do this?
Have you ever put you home on the market and got an offer right away? Did you feel like you might be leaving money on the table? Deferred showings eliminate that possibility. By listing your home in the multiple listing service for a few days and not letting anyone in you are creating a buzz.
In a seller’s market with low inventory, multiple buyers are going to be chomping at the bit to get in and see your home. They won’t be able to though because you’re not letting them in. Your home, however, will be filled with people come the weekend. The chances of getting multiple offers will go up dramatically.
By doing things the traditional way, you can put your home on the market and get a decent offer the next day. What you will never know, however, if there was someone else who would have paid more. You won’t know if you would have had multiple people fighting over your property, bidding it up over the asking price!
Deferred showings are something I do on a regular basis, and it is very successful. Open houses are something I rarely ever do. Instead of having a bunch of people who don’t belong in your home, you have a ton of serious people who have scheduled showings. This is a win-win.
The thing is I am a top producing real estate agent, so I don’t need to use your home as a prospecting activity. You, on the other hand, don’t need every Tom, Dick, and Jane coming through your door to appease a Realtor’s appetite for finding a few more clients to buy elsewhere.
You can sell your home without an open house – end of story!
The Open House Exception
There is one exception where open houses can be a vital part of real estate marketing, and that is with new construction. With new homes, you are not marketing a single house but typically an entire neighborhood showcasing the builder’s product, amenities, and options. This is a far cry from trying to sell a single re-sale home. Unless there is a furnished model home, more often than not you don’t need to worry about theft.
Final Open House Thoughts
Other real estate agents get mad at me for speaking the truth about open houses. They ask me why I have such a big issue with open houses. The fact of the matter is I don’t have a problem with them at all. What I have a problem with are agents who don’t explain the risks to sellers and pump them up as being necessary for their own benefits. Both of these things are WRONG! Misleading the public for your benefit brings down the perception of the industry.
Additional Open House Resources Worth Reading
- Do open houses sell homes via Maximum Real Estate Exposure.
- Why you should avoid having an open house via Consumer Advocates in American Real Estate.
- Should I have an open house via Kevin Vitali.
- Should you allow a real estate open house via Debbie Drummond.
- The real estate open house pros and cons via Kyle Hiscock at Slideshare.
Use these additional resources to understand why open houses are no longer needed to sell a home in the digital age.
About the Author: The above Real Estate information on the sell your home without an open house was provided by Bill Gassett, a Nationally recognized leader in his field. Bill can be reached via email at [email protected] or by phone at 508-625-0191. Bill has helped people move in and out of many Metrowest towns for the last 30+ Years.
Thinking of selling your home? I have a passion for Real Estate and love to share my marketing expertise!
I service Real Estate sales in the following Metrowest MA towns: Ashland, Bellingham, Douglas, Framingham, Franklin, Grafton, Holliston, Hopkinton, Hopedale, Medway, Mendon, Milford, Millbury, Millville, Northborough, Northbridge, Shrewsbury, Southborough, Sutton, Wayland, Westborough, Whitinsville, Worcester, Upton and Uxbridge MA.