Prior to the computer era, real estate agents utilized Open Houses to showcase sellers' homes. During those days, the only means of publicizing a listing was to add it to the MLS (Multiple Listing Service) book. These were published about every two weeks and contained one black and white photo of the home with a description about its amenities. Therefore, an Open House was the only means, aside from an actual viewing appointment, for the buyer to see what some selected homes might look like.
New Technology
Technology has entirely changed the way properties are marketed. MLS books have been discontinued in most regions and everything is now on the internet. There are numerous colored photos of listed homes on MLS and real estate agents' websites -- photos of the outside, the inside, the surrounding area and all other amenities that might be of interest to a buyer. Many of them also offer virtual tours so the flow from one room to another or the layout of the outdoor areas can be readily seen.
Ineffectiveness of Open Houses
A study by the Vancouver Island Real Estate Board was done, over a four-year period, regarding 'How Buyers Locate Property' and the findings were that Open Houses, as a means of locating properties, are near the bottom of the list. The manner in which buyers locate their homes is through contacting real estate agents, through MLS website searches, driving by and seeing "For Sale" signs on the property, obtaining information from relatives and friends as well as through real estate tabloids. All these account for nearly 90%. Open Houses represent less than 2%.
In fact, most real estate agents will agree that they get next to nothing in terms of house sales by doing Open Houses.
Why Do Real Estate Agents Still Do Open Houses?
Primarily, real estate agents do Open Houses for the benefit of the seller. There is still the misconception among some agents and most sellers that an Open House represents a viable marketing tool. Real estate agents don't want to disappoint their sellers so continue with this tradition.
A secondary reason for doing Open Houses is the possibility that the agent could connect with a new buyer whom the agent could represent in the purchase of a home. However, this possibility has become slimmer since most serious buyers now search the internet for possible homes and then connect with a real estate agent they have found through a website.
Who Attends Open Houses?
Almost anyone, except really serious buyers, goes to Open Houses. Generally, first on the list are neighbors. They want to have their curiosity satisfied so they drop in. Then you have those who like to drive around and get decorating ideas at Open Houses. There are also potential buyers who may be interested in purchasing in a year or two. The likelihood that the home will not be on the market in a year or two does not seem to be a deterrent. Others simply enjoy going to Open Houses as an entertainment activity. From time to time, there are people who come to Open Houses for ulterior motives not related to purchasing a home.
Inherent Risks in Doing Open Houses
As a rule, the general public no longer picks up hitchhikers. It is now understood that there is an inherent danger in picking up strangers. However, this same concept has not translated into Open Houses. Sellers seem to be delighted with strangers wandering through their homes. Real estate agents rarely consider the dangers to themselves until a tragedy takes place.
Some agents accompany the Open House guests through the home while others allow the people to look through on their own. There are times when several people arrive at the same time and it is not possible to accompany everyone.
Occasionally, Open House visitors use the bathroom and in behind the closed doors riffle through the medicine cabinet for drugs. Bedside tables often contain medications and those are easily checked by the Open House visitor when unaccompanied by the agent.
Sellers don't always put away their valuables and leave change, jewellery or expensive perfume on dressers. Many have valuable art pieces that could easily be removed.
Many sellers have collections of CDs or DVDs. Would the seller actually miss one or two such items? How about cell phones, cameras or computer hardware left in the home?
Sometimes children of Open House visitors are attracted by toys or other items and inadvertently walk out with these.
In an opulent neighborhood, an Open House is an opportunity for a potential robber to check out the home for a future opportunity.
Unfortunately, there are others in society who simply wish to do harm and an Open House can place a solitary real estate agent at risk.
The Future of Open Houses
The internet provides considerable information about homes that are for sale and appointments can be readily arranged by contacting an agent.
The most effective and efficient procedure for the buyer to see a home is to first meet the agent at the broker's office. This enables the agent to do some screening to ensure that the individual is a serious buyer and is qualified to purchase in a specific price range; to discuss the needs and wants of the buyer; to incorporate additional homes that may be of interest and then, to make appointments for viewing of homes.
Open Houses are ineffective marketing tools and should be discontinued. The risks far outweigh the benefits for both the seller and the real estate agent.
Vi Brown - Corporate/business management, real estate broker, author, world traveler, freelance writer for magazines and newspapers.
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