Jon Coile, chairman of Rockville-based multiple-listing service MRIS, writes commentary on the Washington-area housing market.
In the early 1990s, I conducted a survey with top-producing real estate agents from around the country.
How many of you have been holding open houses? I asked. Virtually everyone said yes, which wasn’t a surprise. Open houses have long been a staple of the real estate industry, even though their effectiveness was always subject to debate.
How many of you have actually sold a home at an open house to someone who walked in off the street? I asked. Only about 1 percent replied that they had.
This year, that survey result is no longer valid. Thanks to the advent of online listings, the role of the open house is changing dramatically for both buyers and sellers: Open houses are now actually selling homes.
What’s changed? Well, 25 years ago, information about a property wasn’t as readily available as it is today. People would pull over and jump out of their cars when they saw an open house sign because a house had curb appeal. They’d have no idea if it was in their price range as they walked in the door. Without knowing the price, buyers would typically guess that they could afford homes priced 20 percent above their actual range. Once the affordability issue was resolved in the first minute of viewing, the listing agent might say, “If you are looking for a three-bedroom Colonial with a garage in your price range there’s another home not too far from here that I think might be what you’re looking for. Would you like to go look after my open house ends?”
The popularity of online home search sites over the past few years is positively impacting the effectiveness of open houses. With homes now listed online, buyers can learn everything about a house before they even step foot in it. Buyers aren’t wasting their time visiting houses that are out of their price range. When they pull up to the curb, they already know whether they can afford a home. They’ve likely already seen photos of all its features and just want to come by and calibrate their eyeballs, so to speak, and see if it’s as nice in real life as it looks in the online photos. So you might be selling to people who walk in cold, but they’re not really cold; buyers are coming in to open houses ready to make decisions right then and there.
Even the very nature of open houses has changed; they are no longer limited to the old-school time slot of weekends from 1 to 4 p.m. Seller’s agents are holding open houses seven days a week. The key is to plan the open house to cater to the audience that would be best suited to live in the home and highlight the best attribute of the home or location.
For example, you might consider having a mid-week happy hour with small bites from the hottest new restaurant if you are trying to attract young urban buyers. If the home’s neighborhood is known for the best pizzeria in town, have a weekday evening pizza party to show off the great location. Is your home’s back yard perfect for families and entertaining? Why not show it off by simply serving lemonade on the deck to encourage potential buyers to linger a little longer outside.
More than 100 million unique visitors were looking at houses on some of the major real estate Web sites in June, according to ComScore. There are only 330 million people in America. Are a third of them really in the market for a new home this month? Of course not. Looking at real estate online has become our national pastime. But for those who are ready to move from browsing for fun to actually wanting to get inside, an open house is a great way for them to experience what it would be like to live in the prospective home.
If you want to find a current list of open houses in the D.C. metro area, go to washingtonpost.com/realestate and click on the “Open Houses Only” button in the property search window. It’s powered by MRIS and includes open houses from every broker in every neighborhood. Come on by. We’ve got the lemonade on ice for you.
Previously from Jon Coile: