Loading ...I remember meeting with a seller who’s listing with another agent had expired. I asked the seller how the traffic had been. “Great!” the seller exclaimed. “We have had an open house every weekend, and we are getting tons of traffic!”. “How about showings by Realtors?” I asked. The seller looked puzzled. “Well… er… not too many” was the reply. “Okay, so what has the feedback been from the open house traffic?” I inquired. Here comes the puzzled look again. “Well, er, I’m not really sure. I think they all liked it”. “Then why no offers?” I asked. The seller had no answer.
In real estate, not all traffic is equal. Showings from brokers is the best traffic you can get. And Open Houses can be fools gold. They often trick a seller into thinking they are in the game, when in reality they may have no chance of selling. In fact, if you want to get a real read on where your house is in the marketplace, stop doing open houses.
The difference is this. In order to see a home that is for sale but not open on weekends, the potential buyer has to take some action. They have to contact the listing agent, or contact their own agent, or send an email, or take another step to arrange a viewing. And each step is a litmus test for the buyer’s motivation level. So as a seller, when you get a showing from an agent, at least you know there was some effort involved in the decision to see your home.
On the flip side, you don’t need to take any action to see an open house. You don’t even have to be in the market to buy, and many visitors are in fact not buyers. You don’t have to be qualified, have a down payment, or a credit check. Open house visitors can come in, wander around aimlessly looking at pictures, gathering decorating ideas, and just plain kill time. I am convinced that many people who come through open houses are just plain bored, and looking for an excuse to get out of the house. Not the type of viewings that are going to result in an offer any time soon.
The other compelling reason not to do open houses, but rather aggressively seek showings from agents, is that you get far better information and feedback from the agent showing. The listing agent has the opportunity to interact with the showing agent to find out what the buyer thought, what they liked, any concerns or negatives, and in general how your home ranks in the mind of the buyers. This is very valuable information. At open houses, even if you make a determined effort to solicit feedback from visitors as they leave, you are often greeted by blank stares or shrugs, or puzzled looks that seem to ask “why in the world would you care what I think about this house… I have no intention of actually buying this or any other house”. Not the type of market information that has any value. And asking an open house visitor to sign a guest register seems to be like asking them to fill out an IRS form. They scribble down illegible names and fake email addresses. In fact, just last month I discovered to my amazement that “Elvis Presley” and “Jimmy Carter” had recently visited my open house. Funny, I think I would have remembered them.
Okay. By now many of you are saying “yeah, but there are buyers who come through as well”. And you would be correct. However, if they really are buyers, and they have some level of interest in the house, and it is not being held open, they will take another action to set up an appointment to view the house. So they will see the house, and the sellers agent will actually have a chance to extract information and point out the benefits of the house to the potential buyer, either directly or via their agent.
So back to my premise. The seller is probably thinking if you stop doing open houses, you might not have any showings at all. My point exactly. If you are not getting showings from agents, then that is telling you something… namely, buyers are not interested enough in your home to take the minimal steps involved in setting up an appointment to see the home. You probably need to change something… price, condition, staging, etc. You are not getting dozens of visitors, but you are getting a real indication of how your home stacks up in the market. For example, I have a listing that has received 4 offers in the last 2 weeks, and we have not had one open house. I did receive a number of calls from people asking if it was going to be open. And I was able to set up appointments for a private showing with the serious parties, where I had an opportunity to actually show them the house and explain the many features and benefits without being interrupted by some random visitor saying “excuse me, do you know where they got this painting? I LOVE it!”
So if you want to get serious about selling your house, stop doing open houses. Unless of course you want to brag to your neighbors that “Robert Redford” came through.
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Open Houses Can Be Fools Gold