2010 Feb 15th

Are Open Houses Socialism?

I was in the office Saturday morning preparing for my five (yes, five) open houses when my broker asked me “Why are you doing open houses?  They are a waste of time.” I know a lot of agents and agencies feel that way.  They believe that appointments sell apartments and that open houses are just “real estate theater”.  Agents hold them to appease our sellers to make it look like we’re actively trying to sell their units.  I however, disagree.  I think open houses are an important part of the real estate purchase process, but not necessarily in the way you might think.

karl-marxopen-house-neon

To me, holding an open house is a form of real estate

socialism.  My open house probably helped to sell someone else’s apartment.  Allow me to explain:  as my buyers begin the process of searching for an apartment, I encourage them to see as many properties and go to as many open houses as possible. I tell them to visit places above their price range and below, to visit places smaller than what they require and/or larger than what they need, and in parts of town where they would not necessarily want to live.  I want them to familiarize themselves with the inventory and learn precisely what their money will buy, so that when I take them out on appointments and I show them the place of their dreams, they are not afraid to make an offer. Going to open houses makes buyers more confident of their decisions.

I’ve had many situations where I take my buyers to a well priced, top-notch property that  exactly fits their needs, but they are still new to the process and are afraid to take that leap.  Then 3 weeks later they come back and say “is that first place we went to still available?”  Sometimes it is, but more often than you might expect, it’s gone.  Even in this buyer’s market, really good deals don’t last.

So that’s why I believe open houses are an important part of the process all buyers have to go through.  I don’t really expect someone to walk into my open house and say “I’ll take it!” although believe it or not, that’s happened.  No, I expect that many of the people that come to my open house are just reassuring themselves that the place they saw last week was better for them, or are gathering information for the place they have yet to see.  Similarly, there are buyers out there visiting someone else’s open house that are going to end up making an offer to one of my sellers down the road.

What do you think?  Are open houses worthwhile or a waste of time? Did they help you when you were buying?  Would you insist on them if you were selling?  If you were (or are) a realtor, would you host them, or would you just take advantage of other people’s work without participating in the process?  I’m interested to hear your thoughts.

– by Howard Turoff

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  1. Leslie

    I was an open house junky during the year leading up to my purchase. So, yes, they are worth it for exactly the reasons you describe. I thought I wanted “charming old Hoboken” but after visiting open houses, I realized my lifestyle was better suited for new construction.

    – Les

  2. Lori Turoff

    Thanks Leslie. I think open houses are a great way for buyers to “test the waters” before committing to serious shopping with a realtor. Of course, they are also a great way for nosy neighbors to see how their unit would look with different decor – but that’s fine. I only wish more people would attend them.

  3. Vivian

    I agree that open houses benefit buyers. But not the seller. As a recent seller I did not use open houses. They are a great tool for the listing agent sitting in the house to meet clients to sell other properties to. They can do that on their own time, not in my condo aggravating my tenant.

  4. Kevin

    I agree that open houses are definitely beneficial. Before I purchased my place I went out every weekend visiting 4 to 5 open houses. I was able to see the variety of styles that Hoboken has to offer, railroad, box, duplexes. When I finally ended up working with a broker I knew exactly which type, what area and price range I was looking for and the search only took about one to two more months before I was in contract.

  5. guest

    Why would an open house aggravate your tenant? They couldn’t go out for a few hours? I love going to open houses to see properties without having an agent bug me. Plus, its fun.

  6. JC

    Guest…they will ask for a credit on their rent. Anything to get a few bucks off. Every weekend for a few hours, its an inconvenience.

    Agree open houses are beneficial.

  7. Lori Turoff

    Open houses at the same property every weekend are surely a bit much. A few when the listing is new and maybe another if the price is cut should be plenty.

  8. John Bredin

    From a new real estate agent’s perspective, open houses are a great learning opportunity–whether or not a deal is actually made. You become familiar with the product–stlyles of architecture, new development vs. bronwnstone, neighborhood characteristics, etc.–and, just as crucially, get to practice and hone your art of sales. Considering these myriad benefits, along with potential future business from open house contacts, I say long live the socialism of open houses!!!

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