Open House?

Hosting an open house is a very common method of marketing a listing. They are easy to schedule, inexpensive to advertise and can bring traffic into a house. They have been standard industry practice for a long time, but are they effective?

The answer to that question depends on who is judging the effectiveness. Open houses tend to be most effective for the agent - they are an opportunity to increase exposure in the community and can potentially be a source of new buyer clients. New agents like hosting open houses as a way to get their name out and to meet new people, which is often why you will see them hosted by someone other than the listing agent. It’s the rare home that is sold as a direct result of a buyer attending an open house. Serious buyers schedule private showings when they are interested in a listing. They want their agent to see the house and offer thoughts on value and pricing.

Open house attendees tend to fall into three categories:

• The casual buyer - this is typically someone just starting their home search who wants to see what’s out there before committing whole heartedly to the home search.
• The nosy neighbor - sometimes these visitors come to an open house pretending to consider the house but many times, they sheepishly admit they are simply curious about the updates or the decorating that was done in the house.
• The serious shopper - active buyers do attend open houses, but keep in mind, they would make the time to schedule an appointment either way; the open house just happened to be a convenient way to see the home. An open house isn’t usually the best time to consider a home, they can be crowded and it’s easy to get distracted by the other visitors.

Some home owners are concerned about security during open houses and while we have been fortunate never to have encountered an issue, it’s smart to be cautious. Valuables should be out of sight or locked away and medications should be hidden. During a busy open house, it is impossible for even the most observant agent to keep an eye on all the visitors.

Here at McSharry and Associates, we recommend open houses, but not for the reason you might expect. We believe they can be effective when strategically timed at the beginning of a listing. This timing can create a fear of loss among potential buyers. Prospective purchasers tend to anxiously await fresh listings and when a new house hits the market with an open house advertised for the first weekend, that can create a sense of urgency. Excited buyers are more likely to schedule an appointment before the open house and if they really like the home, they might make an offer, hoping to cancel the open house and eliminate their competition. This doesn’t always occur, but when it does, the seller is uniquely positioned to hold out for asking price or very close to it. It’s a situation that is only effective when a listing is new on the market, which is why we do not recommend multiple open houses. Frequent open houses are very passive and can give the appearance of desperation.

Like with all of our marketing services, we strategically utilize open houses as a way to help our seller clients attain their goals, not because it’s what everyone does.