There’s a common misconception among sellers that their listing agent should hold an open house in order to sell their home. One study by RISMedia showed that 35 percent of sellers expect their Realtor to include open houses in their marketing plan. RISMedia also found that less than 2 percent of homes sell as a direct result of an open house. Even the National Association of Realtors said in a recent Profile of Home Buyers and Sellers that with over 90 percent of home buyers starting their search on the internet, buyers don’t have the need to go in as many houses as they used to.
The truth is that an open house rarely sells a listing. In fact, in our 13+ years of working as Realtors, we have never seen an open house result in a sale. Not even once.
Then why do real estate agents hold open houses?
When Realtors start their careers, they’re taught that open houses are a good way to generate buyer leads. New agents typically ask the more experienced listing agents in their office if they can hold an open house for them. (Listing agents generally don’t hold open houses for their own listings.) The new agent usually has a sign in sheet at the home for buyers to fill out, and it’s common practice for agents to reuse previous sheets or add a few lines themselves (similar to a bartender sticking a few dollars into the tip jar at the beginning of the night) in order to encourage visitors to participate.
Again, the goal is for the new agent to get buyer clients from an open house. Sure, the agent and buyers tour the listing where they first meet, but the conversation always turns to other listings that might meet their needs. A successful open house will result in emails to new buyers with other homes to consider or (best case scenario) a scheduled date to show homes. I’ve even heard of agents in my office leaving the open house to go show another home down the street or in a nearby community.
New real estate agents often take seminars/classes in order to target their marketing methods and learn how to get more clients from open houses. Simply do a Google search, and you’ll find a plethora of advice and other info aimed at helping agents get more leads by holding open houses. (Note that there is very little advice on how to sell the actual home where the open house is taking place.)
Does the public attend open houses?
Attendance completely depends on the agent’s marketing strategies, the weather, the season (especially with tourism in Charleston), and some luck. I hear agents talk monthly in my office about holding an open house where no one showed up at all. A successful open house could have as many as 6 buyers. Perhaps a better question to ask is about the type of person who shows up. Nosy neighbors are notorious attendees. You’ll also find plenty of folks who haven’t talked with a lender yet to see what price home they can afford, buyers who haven’t gotten serious enough yet to meet with a Realtor, people who are “just looking,” and buyers who haven’t honed in on a particular suburb or neighborhood yet.
Based on our experience, we’ve found that it’s better to spend our time and our own marketing dollars on getting professional photos and virtual tours, gaining exposure through social media, hiring drone photography (if it’s a listing with a great water view), and using our relationships with other top selling Realtors to talk about your listing. You’d be amazed how often word of mouth within a top ranked office or company can generate showings and offers. Our company, Carolina One Real Estate, sells 1 out of every 3 listings in Charleston and is notorious for selling listings in house. Having face to face conversations, Facebook chats, phone calls, and emails with other top Realtors is some of the most effective marketing we can produce for our listings.
Does a seller get any benefit from open houses?
Sure, but understand that it’s marginal. When an agent holds an open house, she usually posts an ad in the local newspaper, stakes signs along busy roads, and runs social media ads in order to give the home as much exposure as possible. A seller should never be disadvantaged from having an open house. After all, there’s no such thing as too much exposure for a listing.
My main goal in writing this blog is to clarify who benefits from open houses, and the primary gain is the agent’s. I tend to have this conversation frequently with my seller clients, and I’m surprised that there are still so many sellers out there who believe that open houses will sell their home. I’d rather be honest with my clients and focus my time, energy, and money on getting their home sold.
Selling your home in Charleston?
We’d love to talk with you about our marketing plan to sell your home, the Keadle Group’s success rate, and the advantages of using Carolina One Real Estate to list your home. Contact us so that we can learn more about your home and provide you with a CMS (comparative market analysis). We can also discuss your goal pricing, your time frame for moving, and any other specifics you’d like to talk about!