I was taking the pulse of the local real estate market a few days ago, and was interested to learn that, in some of the neighborhoods where sales have slowed to a crawl, open houses are again in demand.
Although most real estate agents I know have never minimized the importance of it in drumming up buyer interest, the open house has often been criticized by sellers as a marketing vehicle for the agent, rather than the house.
I’ve never seen any statistics showing the number of houses that are sold at an open house. I do know that in a market in which demand outstrips supply and every house has multiple bidders, a lot of buyers in the last three years have arrived with checks they are willing to hand to the agent without even getting past the front door.
October numbers from the National Association of Realtors show a general slowing of the market. Chief economist David Lereah on Oct. 29 announced that the boom was over, so savvy sellers are making sure that there is at least one open house the weekend after the house goes up for sale.
As a buyer, I’ve found that they’ve allowed me to get a handle of what was on the market before I actually latched on to an agent to bring me around to look seriously. Frankly, we’ve never taken a second look at any one of them, and for a variety of reasons. Some were out of our price range, so there was no reason to waste our time, the seller’s and the agents. Some were simply awful. In a few cases, the listing agent turned us off, or simply ignored us, or couldn’t get to us because the house was so crowded.
I like to examine what I’m buying, and you just can’t seem to do that in a house full of people.
From my experience as a seller, I have mixed feeling about open houses. We sold our first house just as the market was beginning to slow in the late 1980s. We also lived within a couple of blocks of the worst housing project in the city, but in a close-knit, relatively safe, attractive neighborhood that had a mixed population – racially, ethnically and economically.
The first agent we interviewed was not familiar with the neighborhood and, from what we gathered from talking with her, thought a lot of prospective buyers might be afraid to even look there.
The second and third agents shared her views. So we went with an agent who had lived a couple of blocks away all of her life, and who we believed would figure out a realistic approach.
Open houses were scheduled every week. She was present at the first. Substitutes from her office either failed to show up or stayed just 15 minutes, and when no one showed up, they left.
After three months, we went with another agent who sold the house in less than a week.
The buyer had been at the first open house, and, she told us later, had really wanted the house after she’d seen it. The agent had paid no attention to her, preferring to deal with an older couple, who, as it turned out, were neighbors out for a look.
The next house went up for sale in an up market in June 2001. The house had three appointments on Friday and seven on Saturday, but the agent still wanted an open house.
We agreed and left for a few hours. Fifty different groups showed up in the three hours, including all the people from the appointments. The agent called three others from her office to help her deal with the traffic. From that open house, we had seven offers, either at or above asking price.
Odd as this may seem, the people who bought the house returned after the open house, and after the agent had gone to dinner and was unreachable. We tried to contact the agent, then agreed to let them in to look, but said that we would prefer to have the agent answer any of their questions as the condition.
The open house had been their first look at the house, and they were the ones who offered the most for it.
Open houses can sell houses, but whether or not it does depends on your listing agent. If the agent hasn’t done the homework, doesn’t know you, the house, the neighborhood and the potential buyers, it can be a huge waste of time.
Written by Al Heavens