DEFINITION of 'Open House'
An open house is a scheduled period of time in which a house or other dwelling is designated to be open for viewing by potential buyers. The term open house can also refer to the real estate property itself; in either case, it applies to dwellings that are for sale by the owner. They are often held to advertise a newly developed community.
BREAKING DOWN 'Open House'
Many open houses occur on weekends, with banners and other fanfare used for advertisement. Owners keep the houses clean and immaculate during this time, to attract potential buyers. Some owners or agents also serve cocktails or hors d'oeuvres at these events.
Benefits of Open Houses
For people trying to sell their homes, an open house provides an opportunity to attract interested buyers to the property. A well-executed event can generate excitement about the home and potentially lead to an offer. Many realtors advise their clients to hold an open house the first weekend after the property goes up for sale.
Even if the event does not snag a buyer, an open house can still be beneficial. As visitors walk through the home, they are likely to discuss their perceptions of the home. This feedback can alert the realtor to issues that might be preventing the house from selling. Unattractive paint colors, for example, can be an easy fix that can boost a home's selling potential.
Broker's Open House
In contrast to a traditional open house, which is open to the public, a broker's open house is strictly for real estate professionals. The intention of a broker's open house is to give real estate agents an opportunity to view the property. It also allows the seller's realtor to solicit professional opinions from peers about the property and its price. In many cases, the broker's open house encourages buyer's agents to schedule a showing for their clients.
Arguments Against Open Houses
For some sellers, an open house entails more effort than it is worth. During the event, the property owner must leave the property to give the realtor free rein. This means making alternate arrangements for children and pets. Owners also need to remove personal items such as photographs that can prevent prospective buyers from imagining themselves in the home. Due to safety concerns, some sellers are also hesitant to have groups of strangers walking through their homes.
With the advent of the Internet, most properties are listed on the Web before the first open house is even scheduled. Home seekers can view photos and information about the property's condition on a website, allowing homeowners to cast a much wider net for potential buyers. For some sellers, this can make open houses seem obsolete.