Should You have an Open House in Portland?
The Open House is a classic among real estate marketing tools. But do open houses still work in Portland? This article will definitively answer that question with researched analytics!
What is an open house? Basically, for buyers, they’re a way to casually look at some homes without scheduling a private showing with a buyers’ agent. For sellers, open houses can generate a good deal of buzz about the home and allow dozens of people to walk through in the course of a few hours. Open houses in Portland as typically hosted by a licensed real estate agent, or in the case of a for sale by owner home, it could be the sellers hosting it themselves.
Do open houses work?
Yes. Absolutely yes. I’ll need to give a quick history lesson here. Open houses used to be an absolutely vital part of real estate marketing, back before the internet. Then once the internet became prominent in the early 2000’s, the open house was practically abandoned. Everyone came to see the house because of internet advertising and open houses brought in very few people, mostly neighbors. For a number of years in the early 2000’s open houses accounted for maybe 1 or 2% of sales. That has changed. Starting around 2010 all of the major real estate portals (like Zillow and Realtor.com) started letting real estate agents advertising their open houses online – where the buyers were. Suddenly visitor counts to the open houses went up and they were not getting there because of random yard and street signs, they were getting there because they saw the open house advertised online. Now open houses contribute to as many as 8% of sales nation wide according to the NAR (National Association of Realtors) 2016 Profile of Home Buyers and Sellers. I know that 8% is not a huge number, the overwhelming reason a home sells is due to internet marketing in combination with a real estate agent. We have spent a lot of time and money to ensure our online home marketing program is the best in the Portland metro area. Even though 8% is not a massive number it is still the second most important thing a real estate agent can do for you.
There is a second reason to have an open house, multiple offer management. We start the majority of our listings on a Thursday and then have an open house on Sunday afternoon. This creates what is often called an offer window. There is way more buyer traffic on the weekend than on the weekday and buyers will only wait a few days to hear back on any offer. So, this means if I started a listing on a Monday or Tuesday I’d be doing the home owner a disservice. If we received an offer on Monday or Tuesday many buyers would not be willing to wait through the weekend to hear back. Currently we average about 50% multiple offer situations – so this is a big deal. We want as many buyers as possible to see the home, all at once, so they compete with each other. The open house helps create the finish line to the process, the last time to see the home freely before all offers are due. We do not want the seller to accept an offer too fast, we typically advise them to wait until after the open house.
Any exceptions to the rule? Any reasons to skip the open house?
Yes, there are two main reasons. First, rural properties can be so remote that you never get enough buyer traffic to justify an open house. Those two buyers that would have come that weekend would have come anyway, and just set an appointment. The farther out the house is from a city center the less likely it will find itself in a multiple offer situation (so don’t price it too low hoping for a multiple offer situation to bring the price back up), and therefore less valuable an open house will be. Buyers in those remote areas typically expect to set an appointment. Now, I’m not talking about a rural city, if you are in a small town or small city, have an open house! I’m talking about homes that are miles away from the local city or town. Second, luxury home owners typically do not want just anybody to walk through their home. Real estate agents cannot control who comes through the door in an open house. It is an open door. All other times the real estate agent can control who comes in and can know who is coming. In luxury properties you can get home buyers simply on tour, something to do on a weekend. Also there may be more valuables worth stealing in a luxury property. Theft is rare in open house situations but does occasionally occur.
How should your real estate agent hold the open house?
There are a lot of agents out there using dozens of signs, balloons, and baking cookies for an open house. There are a lot of agents walking around your neighborhood with flyers inviting your neighbors to come to the open. There are a lot of agents mailing postcards to your neighbors to get them to attend the open – and on and on it goes.
Do these things work?
No. They do not help you sell your home. They help the real estate agent get more listings in your neighborhood. Those tactics are for the real estate agent’s benefit – not yours. Your neighbors are not going to buy your home, the statistics on that are so low it is almost zero.
What should the real estate agent do to make sure the open house is successful?
First, the agent needs to make sure the open house is advertised on all the major real estate websites. Second, they need at least one sign in front of the house. Third, they need to be courteous and professional, answer any questions and point out the highlights.
Focus on what matters.
Ninety-five percent of home buyers are using the internet to search for a home, and that’s typically the only tool they need. After that, they call their agent to schedule a private tour. If you don’t want to have your home hold open, then don’t do it. Again, it only accounts for, at most, 8% of sales.
If your real estate agent is talking up an open house and not focusing on the online marketing of your home: how many online views can they generate – how fast do they respond to those buyers – are they going to use professional photos and or videos – then beware. Those are the most important questions. Unfortunately most real estate agents will simply tell you that they are going to list your home – everywhere – online. All companies can do that. That is not a helpful statement. Are they going to do anything different to get more views? How fast are they going to respond to the buyer’s online interest in your home? How good will your home look online? We take it many steps further.
Open House Advice for Sellers
If you and your agent decide that an open house really is a useful way to market your home, make sure you’re covering yourself. Not to be paranoid, but you’re letting strangers walk through your home! Be smart and don’t leave anything out that could be tempting to thieves. Lock up valuables and checkbooks. Another thing people don’t think about hiding are calendars that show their schedule. And, identity thieves love open houses because they can easily swipe a bill or letter with personal information. Again, these things are rare, but it is good to be proactive.
Open House Advice for Buyers
As a Portland real estate for more than a decade, my number one tip for home buyers is not to wait for the open house. If you see an ad for an open house online, and you really like the home, call or shoot an email to your buyers’ agent to schedule a showing! The home may be snatched up by the weekend. We advise our sellers to wait until after the open house to accept an offer, but many other real estate agents don’t. They may be encouraging their seller to accept the first offer that comes through – that way the real estate agent doesn’t have to work every hard. So if you’re a buyer – get out there! If your buyers agent is not readily available, work with one who is. Work with a top ranked team that can provide near 100% availability!
The Future of Open Houses
Portland is known as the Silicon Forest for our strong technology sector, and it shows in the way we sell homes! But regardless of video tours, 3D tours of homes, most home buyers want to physically walk through their next home before they buy it, and I don’t think that is going to change. The next place you live, the place you may raise your children, is not a minor decision, typically not a fully digital one. Digital – online marketing – gets them in the door, but they will want to walk through that door. I don’t believe open houses will ever go away.
Another thing I do not believe will change — the right real estate agent on your side makes all the difference in buying or selling your home.
