What's My Franklin TN Home Worth?: Are Open House Visitors Legitimate Home Buyers?

Are Open House Visitors Legitimate Home Buyers?

Are Open House Visitors Legitimate Home Buyers?I hosted an open house on Sunday. The weather was beautiful and the open house was in a good location to attract passers-by. We had ten couples who visited that day.

As the sellers returned home, I told them we had good traffic but not sure any were legitimate buyers. They suggested we have an open house every week because they are getting more buyers through the house in two hours than they do all week. Just because these people attended the open house doesn't mean they are actual buyers. 

Sellers often think that visitors attending an open house are interested in buying their house right now and have chosen to view it through an open house rather than contacting an agent. This is rarely the case. As a matter of fact, in the eight years I've been selling real estate, only one open house visitor actually purchased the home. He didn't do that until 30 days later.

The majority of the attendees may be interested in buying a home sometime in the future but may not have the ability to buy right now. Or this house may not even meet any of their criteria. This is exactly why I don't advise sellers have an open house. Many visitors may be six months or more away from buying. Case in point, here is what I learned upon contacting these supposed buyers:

  1. Three couples stopped in because they saw the sign--Looky-lous. They don't plan to buy at all.
  2. One couple lives in the neighborhood. They are listing their house soon and were measuring up the competition.
  3. Two other couples won't be in the market for two or more years.
  4. One couple is looking for a home priced less than $417K dollars. This home is priced at $499,900. 
  5. Two other couples are interested in buying within the next six months. They both own homes that aren't even on the market yet. They aren't interested in selling their homes before next Spring.
  6. One agent arrived with his client. We had spoken earlier in the day. He was out showing this couple several properties and added us to the list. 

The seller viewed these ten couples as ready, willing and able buyers. They were not. Unfortunately, the people who often come through an open house aren't necessarily in the market to buy right now or may not have the financial wherewithal to buy now.

When buyers are working with an agent, they are usually within three months or less of actually making a purchase. In most cases, the agents have already vetted the buyers. They know they have the ability to financially purchase the home they are viewing.  They also know the house meets some of the buyer's criteria. Open house visitors haven't been subjected to that scrutiny. It's very possible the attendees aren't even qualified to buy your home.

Interestingly, the only immediate buyer who visited the open house was brought there by his agent.

I try to explain to sellers there are better ways to get legitimate buyers to view their home. Targeted marketing directing buyers to features in the home will yield better results. They see so many agents offering open houses, they think there must be a benefit.

The truth is the real benefit is to these agents. While open houses don't usually present an immediate buyer for the house they are holding open, they can be a gold mine for future business. As was the case on Sunday. Five of the ten couples who came through the house are looking to buy sometime in the future. These buyers don't currently have an agent. Good follow-up with these buyers could lead to future sales.

If buyers aren't coming through your home during the week, it's more likely related to price or condition. Talk with your agent about the best way to get your home in front of buyers who are currently in the market. You'll be much happier with the results.

Are open house visitors legitimate home buyers? Maybe sometime in the future but probably not now.

Tammie White, Managing Broker/Owner
CLHMS, CRS, GRI, SFR
Franklin Homes Realty LLC
Franklin, TN
(615) 495-0752 
GET REAL. GET LOCAL.
 
This posting with the content written here and photographs displayed are the intellectual property and opinions of Tammie White of Franklin Homes Realty LLC. Any party who uses this material without the written permission of Tammie White is subject to copyright infringement and possible lawsuit.
Comment balloon 18 commentsTammie White, Broker • November 12 2015 04:57AM

Comments

Good morning, Tammie... this is precisely why I don't do open houses anymore. You don't need traffic to sell a home. You need the right traffic. I read statistics years ago that the average open house visitor was 6 months from buying a home. So maybe you get a prospect out of it, but your seller doesn't get their home sold.

Posted by Nina Hollander, Your Charlotte/Ballantyne/Waxhaw/Fort Mill Realtor (Coldwell Banker Residential Brokerage | Charlotte, NC) about 3 years ago

Good morning Tammie, you're correct not all buyers who go through an open house are ready willingand able buyers. We do them to generate future Sellers in the neighborhood 

Posted by Joe Jackson, Clintonville and Central Ohio Real Estate Expert (Keller Williams Capital Partners Realty) about 3 years ago

And then we read that in some markets, an Open House is very succesful.  Once again I am forced to quote Michael Jacobs  ....I guess "it depends".

Posted by Roger D. Mucci, Lets shake things up at your home today! (Shaken...with a Twist 216.633.2092) about 3 years ago

Tammie, well planned and publicized Open Houses are probably the most effective to market a home.  In this area, I'm guessing that well over half of the homes sell to buyers who visited the Open House and then had their agent write up the offer.  And sometimes they looked like lookey loos.  It's hard to tell. 

Posted by Patricia Kennedy, Home in the Capital (RLAH Real Estate) about 3 years ago

Open houses can be a great way to add to your data base but that seems to be the primary reason for holding them as they rarely sell the property.  They can also pose a safety issue for the host agent and the sellers' belongings... That all being said, this girl has found better outcomes by spending a Sunday afternoon with serious & vetted buyers or my family.  Great topic Tammie & interesting to see the traffic/benefits of these events in different markets.

Posted by Brenda Mayette, Getting results w/ knowledge & know-how! (Miranda Real Estate Group, Inc.) about 3 years ago

Nina - If I'd been looking for buyers, this would have been a great opportunity but that isn't going to help my client sell his home.

Joe - We see more buyers than sellers.

Roger - As I always say, "Real estate is local."

Patricia Kennedy  - The only time we see this happening in our market is if there's a hot property priced under $300K that has held off showings until the open house. Then a home might have 20 buyers through it and yield multiple offers. Otherwise, open houses aren't the best way to market a home here, even well-publicized ones.

Many listing agents refuse to offer them. I don't advise sellers to have one but if a seller persists, I will agree to host one to satisfy their curiosity. The result ends up being frustrated sellers. They think the visitors are legitimate buyers that we can convince to buy their home. That's not going to happen. Either buyers are interested or they're not, no coercion on my part is going to convince them to buy.

Brenda - There was good traffic but no legitimate buyer.

Posted by Tammie White, Broker, Franklin TN Homes for Sale (Franklin Homes Realty LLC) about 3 years ago

This is weird.  I could have sworn that I read and commented on this yesterday.  I so agree...most going to open houses are not ready nor qualified to buy yet.

Posted by Debbie Gartner, The Flooring Girl & Blog Stylist -Dynamo Marketers (The Flooring Girl) about 3 years ago

Debbie Gartner - You did. For some reason that post re-verted back to a draft that wouldn't remain as a public post. I had to re-post it. You're not going crazy.

Posted by Tammie White, Broker, Franklin TN Homes for Sale (Franklin Homes Realty LLC) about 3 years ago

At least here in my market most attendees of open houses are tire kickers or nosy neighbors. I can't even remember the last time I sold a home due to an open house. It's been years and years. 

Posted by Nicole Doty - Gilbert Real Estate Expert, Broker/Owner of Zion Realty ZionRealtyAZ.com (Zion Realty) about 3 years ago

Sellers seem to think that people through the house (regardless of who) is a good thing.  I think it is more important to get pre-qualified serious buyers in the home.  Have fun with this one.  Hopefully you and Tom aren't camped out every weekend.

Posted by Belinda Spillman, Colorado Living! (Aspen Lane Real Estate Colorful Colorado) about 3 years ago

Hi Tammie - Our open house success rate for actual sales mirrors yours, and we always explain to our sellers why we're willing to do them, but that it's most likely not going to lead to a sale of their home - most serious right-now buyers are doing their looking on-line and working with their agent.

Posted by Dick Greenberg, Northern Colorado Residential Real Estate (New Paradigm Partners LLC) about 3 years ago

Tammie,

I agree with you.  In our area, there are many open houses, and these work because these homes are often bought as a second home.  When we sold our home in Los Angeles, we insisted on no open houses, and no signs.  A

Posted by Ron and Alexandra Seigel, Luxury Real Estate Branding, Marketing & Strategy (Napa Consultants) about 3 years ago

Tammie White - Open house is an open invitation to view - nothing more. It's a marketing tool, one of many that agents have to promote a property.  It's important that sellers understand the purpose of open house and the advantages and disadvantages of having one in their local market.  Great post and information for sellers!  

Posted by Laura Allen, Lake Tahoe - Truckee Real Estate for Sale www.TahoeLauraLuxuryHomes.com, Tahoe Real Estate Agent Helping Buyers and Sellers (Coldwell Banker, Tahoe City, CA (530) 414-1260) about 3 years ago

Nicole - Any visitor is good if the agent is looking for future business. However, if they are looking to sell the listing, there are better ways to do it.

Belinda - My thoughts exactly.

Dick - I had an open house a couple of months ago on a house that had an awesome online presence. As a matter of fact, several visitors said they were so hoping we would have an open house so they could see it. Not one of the attendees wrote an offer on the property. That just goes to show, these people aren't serious buyers.

A - I love seller who insist on no open houses.

Laura - Some areas might have great success with an open house. The only time we see that here is if it's priced under $300K and it's the first day of showings.

Posted by Tammie White, Broker, Franklin TN Homes for Sale (Franklin Homes Realty LLC) about 3 years ago

Tammie, great post and especially the breakdown.  In some of my more productive (30+ people) open houses, I've found that the majority are "lookie loo" neighbors wanting to know what's happening on their block.  A handful are active buyers, but not serious as they don't want an agent.  Some are serious and are either there with their agent, or their agent called and registered them before the open house.

 

My favorite ones were: "We go open house shopping after church each week as a family outing." and "My agent is holding an open house at my house, so I have time to kill and thought 'what the heck, let's look at open houses'."  Feel free to use those examples anytime (that goes for anyone else too).

Posted by Ryan Huggins - Thousand Oaks, CA, Residential Real Estate and Investment Properties (www.HugginsHomes.com) about 3 years ago

I won't take listings from sellers that want open houses. It's just so rarely a productive use of time, a precious resource. Most don't want them anymore.

Posted by Corinne Guest, New Homes Specialist (Barrington Realty Company) about 3 years ago

I'm of the mind that anybody that's interested has the potential to buy just based on the fact of being interested.

Posted by Laura Cerrano, Certified Feng Shui Expert, Speaker & Researcher (Feng Shui Manhattan Long Island) almost 3 years ago

I don't rule out that it's easier to get a commitment from somebody with a financial investment, having just said that.

Posted by Laura Cerrano, Certified Feng Shui Expert, Speaker & Researcher (Feng Shui Manhattan Long Island) almost 3 years ago

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