The Open House is nothing more than 'Buyer Bait'

By
Real Estate Agent with RE/MAX Suburban
https://activerain.com/droplet/4LWb

Open houseWhy won't anyone be honest with sellers about agents using their open house as 'buyer bait'? I haven't been in favor of open houses in years and due to the latest agent fatalities over the last few years, it makes me dislike them even further from a security standpoint.

In a recent survey done by RISMedia on the subject, 56% of agent respondents said they were 'pointless'. I have to agree and do not have them in my marketing plan.  I don't think that Realtors have been honest about what an open house is actually used for - BAIT.

It's for the agent that is looking for buyers and if your home doesn't fit their criteria - they'll just sell them another one with more of their preferences. Baiting for buyers that are hopefully breathing & prequalified!

It's for the agent that is also looking for listings. This one is more slyly veiled as when an agent is entertaining your guests (aka your neighbors) they are also trolling for listings.  I myself have had this happen years ago when I did hold open houses.  Neighbors thinking of selling soon are actually 'interviewing' agents by seeing what type of marketing is done or provided to buyers.  Neighbors don't really have to give factual information to the agent butopen house bait don't think the agent doesn't notice when the 'buyers' pull into the driveway across the street!

Notice what I've highlighted - It's for the agent!

Not the seller who is hopeful that someone will walk into their home & just fall in love. I often tell my sellers when they mention 'the odds' that someone would have a better chance of:

a) winning the lottery or
b) getting stuck by lightening.

I believe in total transparency & I just wish that agents would be more truthful about the success of open houses & the odds for the seller. An open houses success cannot be predicted nor reproduced as any good marketing plan should be. There is never any assurance of success which is never fully related to the seller.  The poor seller is lead down the path which produces business for the agent not a selling success for their home.

I know there are agents right now that are saying 'Lyn, I've had success doing open houses' ......open house Really? Define success? Define your 'at bat' ratio?   I bet if you thought about it you'd really be surprised at the results or lack their of.

I do believe that in certain markets they can be totally effective.  I don't believe in my Schaumburg suburban market that is the case.  Buyers are not 'neighborhood' driven like they are in the City of Chicago.  In Chicago, they are done more often with a greater amount of success.  I'm sure this can be documented in all larger cities.

I just feel that someone should genuinely tell the public what is going on with honest success numbers.

 

open house

 

RISMedia: Open Houses: Profitable or Pointless?

 

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lyn sims remax suburban  Lyn Sims    Schaumburg IL Area    Northwest Chicago Suburbs  ●  (847)230-7324
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Re-Blogged 2 times:

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Topic:
Home Selling
Location:
Illinois Cook County Schaumburg
Groups:
Active Rain Newbies
Realtors®
Bartender, Make it a Double
Tags:
open houses

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Rainmaker
144,350
Suzanne Cutler
Success! Real Estate - Braintree, MA
617-549-5829, Braintree MA, Realtor, Real Estate

In my market area for a hot property the listing agent usually says no showings until the open house and they get mulitple offers.  If they didn't have an open house the seller would not get multiple offers the lucky buyer would be the first one in.  Some agents even let buyers in but don't go over the offers until after the open house.

Dec 16, 2015 02:33 AM #76
Rainmaker
1,535,036
Lyn Sims
RE/MAX Suburban - Schaumburg, IL
Schaumburg IL Real Estate

Suzanne:  In my MLS we cannot put off showings for any reason. List day = show day or they take your listing down.

Brian:  Yes. I feel that it is no longer in my marketing program because of the success percentage. Just like ads in the paper - nope. Don't do them & I tell the seller my thoughts based on MY lack of success or results. It really boils down to this - are you doing them for the seller or for you (agent)?

Dec 16, 2015 02:45 AM #77
Rainmaker
306,590
Victor Amadi
PRODUCER Realty, LLC - Greenville, SC
Greenville SC Realtor - Greenville SC Homes for S

Interesting post, Lyn. Although we don't include Open House as part of our marketing strategy for our sellers, we do hold "Mega Open Houses" for some of our listings since these  require a lot of work from my team, and the home would have to either be on a main road or have very few turns to get to the house.

 

One of our recent Mega Open Houses, we had about 60 people come through the door, but the home went under contract the night before the event. We proceeded with the event anyway since we had been marketing for almost a week and invited lots of people. So I am not sure whether it would have sold at the event or not, but our client was happy with the turnout and my team had a lot of people to follow up it.

 

The way I see it, if we were to hold a Mega Open House and have lots of potential buyers visit, maybe that home will be one of the 9%. If not, what's wrong with having more buyers to work with or maybe adding one or two listings to your inventory?

 

Again, our Mega Open House is not something that we promise to our sellers since not all homes are good candidates for this type of Open House. For the homes that are, we like to do them. Maybe we can kill two birds with one stone, or maybe three birds if we happen to get a listing from it. 

I think we should definitely set our clients' expectations regarding the odds of their home actually selling at an Open House, but we could always use more people to help with their real estate transactions if the home doesn't sell at the Open House - be it buyers or sellers.

Dec 16, 2015 04:55 AM #79
Rainmaker
139,847
Paul Viau
Nova Scotia Real Estate Blog - Halifax, NS
Nova Scotia Real Estate Blog + Photo Services

In my 18 yrs when I was an agent ,I never sold a home I held open, by doing an open house. About half way through my career - I told my sellers the truth about open houses.  About 1/2 still insisted.   They had been watching too much TV.

Dec 16, 2015 05:14 AM #80
Rainmaker
281,718
Nancy Robinson Ranked #6 in MI
Century 21 Town and Country - Royal Oak, MI
#11 Century21 Realtor in the US, #16 in the World

 

HI Lyn your point is well taken, The open house as a marketing tool goes back to the time before the MLS when  homes were listed  and recorded by index cards in library type boxes.  It was a way to broadcast a home for sale  that   the brokerage  had few ways of notifying the public of the homes availability, 

 We have a few More  marketing tools now including buyer agency and the internet!  But with that  some  areas do respond better to  open house marketing than others,  IF MY sellers really want open houses, i do them  and allow other agents in my office to use the homes as buyer bait as agreed by the seller.  I personally  will hold them  in my primary  market when needed.

Overall   I do believe  that open houses have increased  my personal marketability and the continual marketing  of  my office as well.  And along the way  I have  sold a few homes  from holding homes open. 

Dec 16, 2015 05:37 PM #82
Rainmaker
1,535,036
Lyn Sims
RE/MAX Suburban - Schaumburg, IL
Schaumburg IL Real Estate

Shari Kay:  Not sure if you're an AR member or just stopped by to comment but I sure AM IRRITATED when someone uses the word lazy. Selling real estate is a process & some of it does take time. Sitting at an open house on your hands 'waiting' is also a bad use of your time. So I'll hit you with a 'fast & quick response' because I've got to take my Bentley to the car wash.

Paul Viau:  They think it is part of the program & I think that HGTV & a few of the others aren't helping matters. It's an old concept that needs to sink under the radar.

Nancy Robinson:  That is so true when there were less ways to attract buyers in the older days. You had ads & OH's. 

Victor Amadi:  We don't do MEGA opens but we have done progressives where it's like a tour with prizes/give aways at each house.  That was too much driving for some folks so that ended up not going over well either.  

Will Allen:  Not ever expecting a double ender. How about just a decent buyer prospect?

Dec 16, 2015 10:43 PM #84
Rainmaker
321,335
Jack Tenold
Jack Tenold LLC - Spokane, WA
Specializing in Reverse Mortgages

From time to time I attend the open houses in my neighborhood and sometimes meet other neighbors. Call us curious. I always tell the agent that I'm not in the market for a new home.  For me, the benefit of attending is the opportunity to view the interiors and possibly get ideas about remodels and upgrades since most of the homes are the same vintage and similar in style.  I do think there are inherent dangers to open houses and the potential risks outweigh the benefits.    

Dec 17, 2015 03:09 AM #86
Rainmaker
1,229,941
Gene Mundt, IL/WI Mortgage Originator - FHA/VA/Conv/Jumbo/Portfolio/Refi
NMLS #216987, IL Lic. 031.0006220, WI Licensed. APMC NMLS #175656 - New Lenox, IL
708.921.6331 - 40+ yrs experience

Interesting post, Lyn Sims  .. and certainly got people voicing their comments and views.  So kudos for that.  From reading all the comments, I'd say that the locale and location of the home figure greatly into the success of an Open House .. or lack thereof.  The feedback I hear from agents in the Chicagoland area is typically much the same as yours ... and the further north you go in our area, more so ...

Gene 

Dec 17, 2015 04:24 AM #87
Rainmaker
1,535,036
Lyn Sims
RE/MAX Suburban - Schaumburg, IL
Schaumburg IL Real Estate

Gene Mundt:  Most of the people in our area are agreeing so it might be a Midwest kind of thing. Thanks for your valuable comment.

Dec 17, 2015 05:02 AM #88
Rainmaker
583,750
Peter Mohylsky
PrimeSouth Properties - Santa Rosa Beach, FL
Let me help you find your path to the beach.

I have never heard the term buyer bait but really like it and will use it often, with permission of course.  

I do agree with the original comments but this industry has always been a numbers game and it only takes one.   It is for the agent but that is just part of the games we play. 

Dec 17, 2015 07:22 AM #89
Rainmaker
14,371
Greg Knapp
Artistic Real Estate Group - Plano, TX
- Experience Counts!

Just give the Sellers what they want - and bring a gun!

Dec 18, 2015 12:58 PM #90
Rainer
110,234
Barry Kessler
CENTURY 21 Troop Real Estate - Simi Valley, CA
Barry Kessler

Lyn, I am always irked when I see articles written about how open houses are nothing more than a ploy to get an agent more business. What you are saying to a seller is, hey, all those other agents that promise to hold an open house are jerks who just are looking for their next fix. 

The fact of the matter is, that open houses are a tool in your toolbox. If 10% of homes are sold due to an open house, I think that the tool should be used.

I also think that open houses are looked upon differently by agents in terms of geography. Where I work in Southern California, open houses are expected by the sellers.

Last weekend, I sold a listing of mine entirely due to the open house. 

Dec 19, 2015 03:17 AM #91
Rainmaker
1,535,036
Lyn Sims
RE/MAX Suburban - Schaumburg, IL
Schaumburg IL Real Estate

Barry:  Absolutely just by the answers they are regional in nature. The agents in my area feel the exact same way as I do. To each their own. But the other survey also points out amoung agents themselves that they are leaning toward dumping the whole idea. I really don't think that 9% is a good success ratio & it just so happens that 'doing ads' was also near the number just not long ago. We could easily flip this discussion to ads also.

Dec 19, 2015 03:40 AM #92
Rainer
376,443
Thomas F. Scanlon
Borgida & Company P. C., CPA's - Manchester, CT
CPA, CFP

Lyn Sims - Well done. Excellent post. Interesting statistics. 

Cheers,

Tom

Dec 19, 2015 10:48 PM #93
Rainer
15,095
Erin Newman
My Home Group - Scottsdale, AZ
Highest Level of Real Estate Service in the Valley

Hi Lyn,

I do agree with your statistics about Open Houses.  I can also let you know that I did have a home sell this year ( I was listing agent) by a buyer that came through an Open House.  Another agent in my office held the Open House at my listing. The buyer came through the Open House.  She was working with another agent, and we had a successful Close of Escrow this past Fall.

Our market is low on inventory.  I have had many buyers that have visited Open Houses in the area looking for homes that they are truly interested in.

I find Open Houses to be valuable at meeting other cross agents and getting more information about a local home because someone with first hand knowledge is there to talk about that home.

I find Open Houses to be "Old School".  They offer a sense of what neighborhoods and business use to be - a first hand face to fact meeting and talking.

Thanks for a great Blog!

Dec 20, 2015 01:28 AM #94
Rainmaker
1,220,027
Sheri Sperry - MCNE®
Coldwell Banker Residential Brokerage - Sedona, AZ
(928) 274-7355 ~ YOUR Solutions REALTOR®

Hi Lyn, 

I agree with Barry Kessler , I use every tool in my marketing toolbox to sell a home for my sellers, especially if a seller asks me to have an open house. In fact, I am going to have an open house next week for my seller.  They have a fabulous home that shows well online and in person.  I am happy to do this for them. 

Dec 21, 2015 03:09 AM #95
Rainmaker
846,015
Marco Giancola
Beachfront Realty - Miami Beach, FL
Realtor (305)608-1922, Miami Beach Florida

Hi Lyn-great post and the year comparison shows clearly the direction buyers are going too.

Dec 28, 2015 02:51 AM #97
Rainmaker
1,048,895
Bill Gassett
RE/MAX Executive Realty - Hopkinton, MA
Metrowest Massachusetts Real Estate

Lyn Sims I would be willing to bet there are very few agents who "do open houses" have ever been close to selling 100 homes in a year. Top producing agents understand there is a better use of ones time.

You can say open houses don't work to agents in forums like this and there will always be those who say they "work" in their market. The problem is their definition of work is far different than yours or mine.

The fact of the matter is a real buyer will always schedule a viewing for a home they are interested in. It's common sense. Unfortunately agents who argue otherwise don't want you or I writing articles like this one.

Lets all remember there are 7 days in a week and 24 hours in a day. By my calculations if you are  great agent the other 166 hours in week should far out weigh the 2 hour Sunday special you are tauting to the seller.

Jan 30, 2016 06:00 AM #98
Rainmaker
687,856
Michael Dagner
Brokers Guild Classic - Denver, CO
Your Denver Homes Realty Expert

Hi Lyn, very helpful post!  There's nothing wrong with being honest.  At least sellers now have the missing information and can discuss with their agent whether its still important to waste time and resources on such an unproductive task. 

Mar 03, 2016 02:35 PM #99
Rainmaker
1,492,550
Inna Ivchenko
Barcode Properties - Encino, CA
Realtor® • Green • GRI • HAFA • PSC Calabasas CA

Well, most of my sellers want open houses and if they are allowed by the location, I would hold them. Often the OH is a waste of time for me since most visitors already have agents, but it does bring more exposure to the property.

Mar 03, 2016 05:26 PM #100
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Lyn Sims

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