An open house is a scheduled period of time in which a house is open for viewing by potential buyers. Open houses can attract interested buyers and lead to an offer.
It is a very debatable subject in the real estate world. For some sellers, the idea of an open house is a must, and for other sellers, it seems like a nightmare. There are also real estate agents who feel strongly for or against open houses and some that are indifferent towards them.
Before you decide to organize an open house you should be aware of the pros and cons. This article will give you everything you need to know to decide if your house could benefit from an open house, and the positive and negative aspects of hosting one.
Most important job of a real estate agent is to ensure that their client’s home gets maximum exposure and reaches a wide audience that might be interested in making an offer and purchasing the home. There are many ways that a realtor can increase exposure through marketing, passing out fliers, door knocking around the neighborhood, reaching out to other colleagues in the business and hosting an open house.
While most homes for sale are listed on the MLS, this is not always enough to encourage potential buyers to submit an offer. Without exposure the chances of selling a home decrease significantly. The more people that see the listing in person, the more likely you will find the right buyer quickly.
Holding an open house also provides an opportunity for buyers to view a home in a low-pressure environment. Of course an agent will be available to answer any questions that may arise, but an open house viewing is typically more casual than a scheduled showing.
Additionally, an open house gives buyers who are in the very early stages of the home-buying process an opportunity to view homes without establishing a relationship with a real estate agent to grant them private showings. This type of low-pressure environment can attract buyers who may not have viewed the home otherwise.
When you are selling your home, having to maintain it at all times can be tedious. With an open house, you can prepare for one event that will potentially bring in a lot of prospective buyers all at one time. It’s much easier to deep clean your house for one event than it is to constantly maintain the appearance that you live in a model showroom.
Buyers who are prequalified and working with a real estate agent know exactly what they can spend on a home and would not typically request a private showing for a home they cannot afford. Since an open house allows anyone to walk through, it is likely to attract buyers who are not qualified to purchase the home. This means that when a seller holds an open house, they might have buyers walking through who cannot actually afford to purchase the home
Sometimes serious buyers may not get the necessary amount of time and attention from the host if the footfall is too high. Some may wait it out, but others could just leave without having a chance to speak to the realtor if the viewing is too crowded and busy with other competing offers. It’s only natural that buyers prefer a personalized and instant approach that’s available during a private viewing.
The percentage of homes that actually sell as a direct result of open houses is around 7%, so it is unlikely that a seller will receive an offer based on the open house alone. A majority of homes are sold to buyers who are working with a real estate agent, request a showing, and tour the home privately. Those who approach the home search in this way tend to be more serious about purchasing a home than the crowd that might visit during an open house.
There is no rule of thumb to decide whether to hold an open house or not, because each transaction is unique. Holding an open house is a personal choice. This article has provided objective information for both the pros and cons so you can make an educated decision. Assess your situation, if you feel the pros outweigh the cons, have your agent go for it. Talk to your real estate agent if you are unsure about whether an open house is right for you.
Assistant Manager, Real EstateTreadstone Associates