What is an Open House?
An open house is a scheduled time set for potential buyers to walk through a property that is for sale. Typically hosted by a broker, the owners or renters of the property are absent from the viewing and many potential buyers are welcome to tour the space.
How Does it Work?
Typically scheduled during weekends, brokers welcome potential buyers to leisurely view the property and ask questions, they would otherwise not have the opportunity to do so without a broker present. It is customary for brokers to provide drinks and small plates for those who attend, and many provide collateral that buyers can take with them and refer to with information on the home, such as square footage, number of rooms, and information on the surrounding neighborhood.
The goal of an open house is to secure interest from buyers by providing a rare opportunity to take their time looking at a property closely, before placing an offer.
Advantages of Holding an Open House:
- Provides an opportunity to attract potential buyers. When an open house is planned correctly and properly marketed, it can provide a great opportunity to attract potential buyers, and possibly even lead to an offer. Many realtors suggest sellers hold an open house the first weekend that the property goes on the market – to generate the most buzz.
Open houses can also bring in potential clients who may not have even planned for such an event but happened to be driving by. It’s a great way to appeal to potential buyers in a more casual way and low-pressure scenario.
- Provides feedback to realtors from visitors. Another benefit of holding an open house is for the potential for realtors to gain real feedback from visitors – both positive and negative.
Many realtors find that potential buyers often share their feedback out loud as they walk through the home. This can give realtors crucial insight into buyers’ perceptions and any issues that could keep the owners from making the sale.
- Can lead to an immediate offer. If done properly, and by generating enough buzz, an open house can sometimes lead to an immediate offer. When potential buyers are browsing a home with many others also looking to buy, they can get a good sense of their competition. If competition is high, this may encourage them to make an offer much quicker than they ordinarily would otherwise.
This is beneficial to sellers and buyers alike, as it gives the buyers a realistic idea of how many others like them are also looking to buy in their desired neighborhood.
- Allows sellers to cast a wide net. Showing a home to multiple buyers, rather than one at a time only widens the reach of potential buyers for the seller. It is also much more efficient to spend the same amount of time showing a home to a group of people, rather than an individual.
This, in addition to potential feedback from viewers and an understanding of competition in the market, are huge benefits to holding an open house.
So now that we’ve covered its advantages, what are some of the disadvantages to holding an open house?
Disadvantages of Holding an Open House:
- Requires much effort – sometimes more than it’s worth. Planning and executing an open house is not an easy task. In addition to coordinating a time that works best for the owners to be out of the house for an extended period, making accommodations for pets or children, and removing all personal items throughout the home, putting on an open house requires money and time spent on marketing to bring viewers in. And if no offer is made – it can feel like a huge waste.
That’s why it is important to take the time to properly plan, market, and organize for your open house, if you decide to hold one.
- Compared to online listings, an open house requires more time to reach potential buyers. Nowadays, most homes for sale are listed online before they even schedule an open house. And most buyers go online and browse properties from the comfort of their own home.
Buyers can find almost all the same information online as they would at an open house, like the condition of the home, its details, and even view photos of the property from every angle. This alone, can make open houses seem unnecessary and even antiquated.
- Owners are typically required to leave their home for a designated amount of time. Typically, when holding an open house, the homeowners are asked to leave their home and take with them any personalized photos or memorable that can be found throughout the home.
This can be tedious and difficult to plan for with the daily bustle of normal life. Some would rather avoid having to deal with this added stress and simply list their home online.
- Can open the home up to potential theft. Though there are benefits to opening your home for sale to many individuals – with hopes that with increased awareness, comes increased offers – doing so can open you up to potential theft. Open houses can give opportunities for criminals to explore a property and plan a break-in.
If you are considering hosting an open house, make sure to hide any valuables, or take with you anything that you would not want to get stolen or damaged.