Open House Pros and Cons for Real Estate Agents
“Should I host an open house for my client?” It’s a question that nearly every real estate agent asks at some point in their career. Yet, there never seems to be a clear answer. Open house pros and cons have been debated among industry experts for years, and both sides have valid points.
Many factors should be considered, including your client’s needs, where the house is located and your marketing plan for the home. But to help make your decision, here are some open house pros and cons:
Pros:
An Open House Gains Attention:
Hosting an open house has the potential to bring in a lot of people who wouldn’t have seen it otherwise. Sure, you may have posted pictures online, but you know that the pictures don’t give the house justice. Even the best real estate photos in the world don’t compare to the real thing.
If you market the home correctly (think social media posts, signs in high traffic areas, balloons to advertise the open house is here), you’ll have a larger audience and more interested parties to sell to.
Attracts First Time Home Buyers:
Open houses are like catnip for unseasoned buyers. Even if they are still trying to get an idea of what they’re looking for, it gives you an opportunity to educate new buyers on the process of home buying.
They may not know where to start. All they know is they saw a sign for an open house and they wanted to learn more. This opens the door for you to introduce your services and gain valuable information about new buyers in your market.
Provides Networking Opportunities:
Now, this pro may not necessarily be an advantage to the home seller, but it is for you! Open houses are a networking opportunity and, if marketed correctly, can attract home buyers who may be in need of your services. Chances are, if a buyer attends an open house, they haven’t established a relationship with a real estate agent yet. That’s why they are attending open houses instead of private viewings. This makes them your ideal market.
Getting people in the door not only increases your chances of selling that particular home, but it can generate leads for future clients. You’re not just selling the house, you’re selling yourself as well. Wow viewers with your industry expertise, knowledge of the neighborhood and stellar service – one open house could lead to a list of clients for years to come.
Cons:
Attracts Unqualified Buyers:
Although you may have attracted a rather large showing for the open house, that doesn’t mean everyone attending is a qualified buyer. In most cases, people who attend open houses are very new to the real estate game – they may be inexperienced and don’t have the proper paperwork ready to purchase.
Even if they loved the house and were ready to buy that day, they may not have known enough to get a mortgage pre-approval from their bank ahead of time. Or, they may not be interested in buying at all. A major drawback to open houses are the non-buyers that attend, like nosy neighbors or well-intentioned family members trying to show support. If a large crowd does show, that’s only half of the success – now you have to qualify everyone that walks in the door.
Creates Security Risks:
It’s a sad but true statement – there are security issues with open houses. Open houses are chaotic. People walk in and out all day, and you’re distracted with questions from interested buyers. If there are multiple stories, that means even less supervision of the attendees.
The most preventative course of action would be to warn the sellers of this potential issue, and advise them to hide their jewelry and other valuables during the open house. If you’ve offered to provide staging services, this could be an additional piece of it. Even so, there have been cases where attendees were actually using the open house as an opportunity to stake out the home before burglarizing it at a later time. So be cautious.
An Open House Offers No Guarantees:
You’ve taken all the necessary steps to market your open house and you’ve posted the details on social media, staged the home, and even baked some cookies beforehand to get that warm, homey smell. You even talked to many interested parties who said they would get back to you. The open house comes and goes, and then you hear crickets.
You don’t understand – you’ve put in all of this effort and have no offers to show for it. Unfortunately, that is a common scenario with open houses. In fact, less than 2-3% of homes sell as a result of an open house. While the exposure and new leads may seem worth it, keep in mind that the end goal is to sell the home.
Ultimately, it will be up to you as a real estate agent to gauge if an open house is necessary. With open house pros and cons in mind, discuss the option with your client and decide together the best course of action.