Myths About Open Houses You Need to Know
When you think of selling a home, an open house seems part of the deal. Everyone has an open house, don’t they?
It is the best way to show off the home to numerous potential buyers – isn’t it?
Well, not really. An open house has a lot of disadvantages, which is why they are becoming less popular in today’s market.
To help you understand why open houses are not all they are assumed to be, we will dispel some myths surrounding them. Many of these open house myths are perpetuated by real estate agents.
Remember that open houses have always benefited a real estate agent more than a homeowner.
Scheduled showings bring qualified buyers to your home. Open houses bring anyone with a pulse.
Real Estate agents push this archaic marketing activity for essentially four reasons:
- To potentially shake hands and meet potential buyer clients for other properties.
- To meet a seller down the street considering selling their home and stop by to check out the competition.
- Hopefully, getting lucky and doubling a sale which creates a potential dual agency situation that does NOTHING for you but everything for them (double commission).
- It looks like they are doing something to sell your home.
If it’s your first time selling a house, you should know that open houses are great prospecting activities for agents, nothing more. You don’t need an open house to sell your home. The best combination is a great real estate agent, the correct list price, and fantastic marketing.
Once you have these three things down, you will never need to let Nancy, “the nosy neighbor,” Rick, “the robber,” or Unis, “the unqualified,” into your house again.
1. Open Houses Are Necessary to Sell a Home.
An open house is needed to sell a home, which is one of the biggest real estate myths bar none. The myth, of course, continues to this day because of agents who push for them.
Once people establish a way of doing things, it is easy to assume that the established way is the best. Open houses are presumed necessary because they have always been a part of selling, going back to before the Internet.
But the home selling process, like everything else, should be examined periodically to ensure that all the steps are necessary. Today’s most successful Realtors tend to agree that open houses are no longer required. Many clients will ask, “Are open houses worth it?” Does an open house work?
In the digital age, consumers have access to the Internet and can view homes they want from the comfort of their living rooms. If buyers are interested, they will pick up the phone and call an agent to schedule a showing—this is what serious buyers always do!
Exceptional real estate marketing and a Realtor with a vast network of contacts are the keys to selling. Few houses are sold at open houses, and they often cause more headaches than help.
The National Association of Realtors reports that less than 2 percent of all homes are sold directly from an open house. Consumer Advocates of America freely state how they only benefit Realtors.
You will wind up letting a lot of people in your home that you never would otherwise, and very few will be qualified buyers.
Want some amusement? Check out this funny RE/MAX video on the usefulness of open houses. Enjoy the “three bean salad,” and you will love it!
2. Open Houses Are Effective For Selling a Home.
An open house lets everyone see the house on a specific day. You “open” the home to potential buyers, but you also open it up to the rest of the world. The people who come through your door are not necessarily the kind of people who will buy the home.
A skilled real estate agent can sell a home without an open house. You have to find the right buyer, and holding an open house can hinder the agent’s efforts.
The agent has to prepare and present the open house instead of doing other activities that are far more productive for selling property. The best Realtors know how to sell a house without one. Open houses are a lot of work for minimal reward.
Well, let me rephrase that – a reward for the seller. A Real Estate agent might pick up some excellent buyer prospects to work with.
3. All The People Attending The Open House Will Be Qualified Buyers.
HA HA HA! That is hysterical. The opposite is true.
Many people may attend your open house, and some of them may be interested in buying a home. However, numerous other visitors will not be interested in buying.
Window shoppers, neighbors, and home buyers who are not a good fit for your home—the open door policy encourages everyone to come by, even if they are not likely to buy.
Your agent’s time is better spent finding the core group of buyers likely to want your home rather than talking with all the different people who take advantage of your open house.
The irony about some real estate agents is they will preach about the importance of qualifying a buyer for your home. This thought, however, gets thrown out the window when it comes to open houses.
Qualifying a buyer is the least important thing on an agent’s mind when holding an open house. Your home is a free game.
Your house becomes their office for the day. Come on in, everyone.
The value of private showings with qualified buyers vs. an open house cannot be overstated.
I contacted Debbie Drummond, a Las Vegas Realtor and owner of The Las Vegas Luxury Home Pro, to give some insights on this.
“It’s frustrating to the agent and the buyer/client when they realize they are looking at property they can’t afford. Or, at least, they don’t know if they can afford it because they haven’t done their financial homework.
When sellers see a buyer come through with their agent, they can bet they are ready to buy. Looky loos, neighbors, and Sunday drivers can be exhausting for a buyer’s agent. Be ready! Have your finances ready and an agent to back you up.”
4. Open Houses Don’t Present Security Risks.
It is nice to think you can trust everyone drawn in by your open house, but you can’t. Criminally-minded individuals target open houses because they know they present an opportunity. Some may steal your things while they wander about the house.
Others will choose to wait, scoping out security vulnerabilities – even unlocking windows – to take advantage of later. People have had their homes burglarized by criminals who came to their open houses specifically to see if they could find a way to break in later.
Real estate agents who prospect for future business with open houses don’t want you to know this. A few years ago, a home in Milford, Massachusetts, in my local market, had $15,000 worth of jewelry taken during an open house. For what? The pointless exercise of letting everyone in the door who would like to look at a great home.
The significant threat of theft is what real estate agents who promote open houses DON’T want you to know.
Real Estate open houses can be a magnet for crime!Click To Tweet5. The Nosy Neighbors Won’t Be Coming By.
Sellers like to imagine that there will be a line out the door of qualified buyers when they host their open house, but the line is more likely to be filled with opportunists. I will keep emphasizing anyone can attend an open house.
Nosy neighbors, in particular, like to take advantage of open houses to poke around in your home, compare it with their own home, get an idea of what their home could sell for, and sometimes just get a chance to go somewhere they would never be allowed otherwise.
If you want Bonnie the blabber to come in and sniff around your home, by all means, have the open house. She would love to stop by. Letting the world know about your bedspread and anything else she would like to discuss will take up lots of her time in the coming week.
You might even find her gossiping on Facebook about what she saw at your home. Sounds like fun, right?
Want to turn your home into Deadbeat Central? Have an open house!
6. If Your Agent Says You Need An Open House, You Should Do It.
Your Realtor may insist that an open house is integral to the sales process. It would help if you took such advice with a grain of salt.
The picture on the right captures the mindset of most real estate agents, who continue to promote open houses to the detriment of their clients.
Some agents are still attached to open houses because they have been doing them for years.
If they have always done it this way, why change? Other agents insist on open houses because it allows them to look proper.
Part of the challenge of being an agent is that most of your hard work for the client is never seen.
All the networking, marketing, and constant on-call are not done in front of the client, so it can seem like you are not doing much at all.
But at an open house, you are visibly working.
Your measurement of a good agent should not be based on how much running around you see them doing.
It should be based on their ability to sell your home quickly and reasonably.
Your agent should be able to sell your home for nearly the price initially set without the hassle of an open house.
Frankly, some agents don’t have the balls to look a potential client in the eyes and tell them open houses aren’t necessary to sell a home. The fear of losing the listing is too great to overcome. If the homeowner thinks they are effective, “I better do it” is their mantra. This is called a weak real estate agent!
Find Out if The Realtor is Going to Focus on Them
Ideally, when you choose your Realtor, you should interview several agents and get vital recent statistics. For example:
- How quickly did the agent sell homes?
- What are their average days on the market?
- How close are their homes selling to the original asking price?
- Can you get some recent references of clients they worked with?
Part of the interview process can include questions about open houses.
If you find an agent who is confident that they can sell without one and who meets all your other criteria, you have found a winner.
Your home won’t be subjugated to the potential risk of theft, along with all the other people who don’t belong in your home.
Remember that an exceptional Realtor will ALWAYS discuss the pros and cons of an open house. Use common sense when selling a home instead of following these open house myths.
7. Real Estate Open Houses Have No Usefulness
You might be thinking, how could an open house having any usefulness be a myth? Didn’t I explain why they are not needed to sell a home? I did. However, there is one circumstance where open houses can be beneficial. Are you dying to know the answer?
Open houses can be beneficial for new construction. Builders showcasing their products can use an open house as an opportunity for buyers to see the quality of workmanship, different floor plans, lots, etc.
This differs from a resale home filled with a buyer’s possessions. Model homes are often used to sell additional houses to be built in the neighborhood, and an open house can be an effective means of doing so.
Conclusion
When selling homes, there are several things you shouldn’t do. One of them is worrying about having an open house. By now, you should understand that you’re wasting your time.
Additional Helpful Open House Resources Worth Reading
- Is an open house necessary? RIS Media shares helpful advice on why you should feel confident skipping open houses.
- Does an open house prioritize the seller’s interest? Kyle Hiscock shares why an open house doesn’t put the homeowner in the best spot.
- Should I have an open house? Kevin Vitali shares his valuable experiences with holding open homes.
Ensure you look at all the great resources above on open houses and why they are unnecessary to sell a home. The bottom line is that you will always be better off having private showings. Think twice before you put your home at risk.
About the Author: Bill Gassett, a nationally recognized leader in his field, provided information on open house myths. He is an expert in mortgages, financing, moving, home improvement, and general real estate.
Learn more about Bill Gassett and the publications in which he has been featured. Bill can be reached via email at billgassett@remaxexec.com or by phone at 508-625-0191. Bill has helped people move in and out of Metrowest towns for the last 38+ years.
Are you thinking of selling your home? I am passionate about real estate and love sharing 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, Natick, Northborough, Northbridge, Shrewsbury, Southborough, Sutton, Wayland, Westborough, Whitinsville, Worcester, Upton, and Uxbridge MA.
