Open houses are not the best vehicles for selling homes. So why do Real Estate Agents bother with them? For the following reason: Open houses are a great means for prospecting.
An open house provides a Real Estate Agent with a neighborhood storefront from which to do business for a day. Each time you host an open house, you set up shop in a client's home and open the doors to the opportunity to meet prospects, establish relationships, and expand your real estate clientele.
If your real estate business could benefit from an influx of Buyer or Seller prospects, start staging more open houses. You can hardly find a more effective way to generate leads face-to-face. And, as a bonus, occasionally your efforts will net a sale. Not a bad bonus for a solid prospecting tool.
Think of the open house as the REALTOR®'s equivalent to the retailer's "loss leader". It attracts people into your business. In the same way that a store manager offers milk at a discounted price in order to draw shoppers into the store, a Real Estate Agent invests time and money in an open house in order to build traffic, attract prospects, and cultivate sales of other products.
When I was selling real estate, I wasn't a big fan of open houses. I wanted to keep Fridays, Saturdays, and Sundays free, so I could take a scenic three-hour drive and enjoy the weekend with my family in our vacation home. Obviously, I couldn't have it both ways, so I opted out of open houses. But that was then, and this is now, and a lot has happened to change the way Real Estate Agents work. The impact of the Internet and the time-draining effects of dual-income families, have combined to put an all-new emphasis on the importance of open houses and why you should host them. They rarely lead directly to sales, but they present many other benefits.
A chance to meet potential clients face-to-face
The explosion of online real estate marketing and shopping activity has led to a dramatic drop in the number of phone-to-phone and face-to-face meetings between Real Estate Agents and their prospects. The open house provides a proven way to gain clear and easy real-time access to prospects that are ready to buy or sell homes.
In addition to the home shoppers who drop in, an open house provides the opportunity to meet neighbors and friends of the home's owners - all of whom may end up in the real estate Buyer or Seller market in the future. Take time to learn the needs, wants, time frame, and motivation behind each person's home-shopping experience. Form a connection. It's harder for someone to reject you as "just a salesperson" once they've met and visited with you.
A way to meet the needs of dual-income families
The ever-growing number of dual-income families has put leisure time at an absolute premium. Getting a prospect into your office is a feat. Yet motivated Buyers frequently attend open houses - on their own, as couples, or as families. When they do, you have the advantage of watching them react to a home. You can learn a lot by observing them in the house, noting the features that interest them, overhearing their concerns, and visually tracking their reactions. You also have the chance to visit with them, which is the beginning of turning a casual open house visit into a lasting business relationship.
A means of catering to the do-it-yourselfer's home buying needs
Over recent years, much of the U.S. has experienced a record low inventory of homes for sale. As a result, consumers are programmed to believe that finding a good home for sale is a tough task and that, when a good home comes on the market, it won't last long.
For that reason, more and more prospects have taken their home searches into their own hands in the following ways:
- They actively search out listings online.
- They aggressively shop the swelled ranks of homes for sale by owner, known as FSBOs.
- They spend their weekends doing home shopping "leg work".
- They attend open houses in droves.
When do-it-yourself home shoppers drop into your open house, you're safe to bet on two things:
- They're serious about finding a home for sale
- An Agent doesn't represent them
In other words, they're great Buyer prospects.
A high-touch opportunity in a high-tech world
One of the big challenges facing real estate Agents in today's wired world is learning the identities of their prospective clients. Home shoppers cruise and click their way around hundreds of real estate websites, requesting information via e-mail from scores of Agents without ever revealing more than an e-mail address.
As an Agent, you can you hit "reply" and respond with an e-mail response that provides the requested information, but it hardly allows you the chance to provide your professional counsel and to establish a personal relationship.
For one thing, it's almost impossible to distinguish yourself from other Agents via e-mail. For another, while e-mail allows you to communicate promptly, it does not let you determine the desire, need, ability, and buying authority of the prospect or to determine the prospect's motivation and time frame or to customize your advice to the prospect's unique situation.
That's where open houses come to your rescue. Open houses cut through the electronic interface and put you right in front of prospective Buyers and Sellers - from there you can distinguish yourself, define your prospect's interests, and begin the professional relationship that leads to real estate success.