The Internet has become such a powerful tool for home buying and selling that it’s worth asking whether it’s still worth it to hold open houses. Statistics suggest that it may not be.
According to the National Association of Realtors (NAR), just 6% of buyers found the home they bought by visiting an open house. Not surprisingly, 93% of buyers used websites in their home search, and more than half (52%) found the home that they ultimately bought online. That statistic jumps to 63% for thirty-somethings.
Another factor: the COVID-19 pandemic, which led many Realtors to suspend open houses, at least in the early days. Here are six reasons why open houses may no longer be an effective sales tool.
- Most buyers don’t visit open houses and instead use the Internet to browse homes and narrow down their choices.
- Open houses may benefit real estate agents more than sellers, because they serve as a way for agents to meet prospective clients.
- The risk of theft is a major downside of open houses. Visitors can either steal jewelry and other valuable items or scope out the location for a future break-in.
1. Homebuyers Shop Online
The first step that most buyers take during the home-buying process is to look online for properties for sale, according to the National Association of Realtors.
Buyers do most of their research online, narrowing down their options before they even contact a real estate agent. Real estate aggregator websites allow buyers to search for properties by ZIP code or neighborhood, and filter the results by size, number of bedrooms and bathrooms, features, and even keywords (e.g., waterfront). These websites also show price history, property tax details, school system ratings, and other metrics to help buyers make decisions.
The second step that most buyers take is to contact a real estate agent, who can provide access to homes on the buyer’s schedule rather than during an open house.
2. Real Estate Agents Can Benefit More Than Sellers
Open houses are supposed to attract potential buyers, but often, all they do is bring new clients to real estate agents. That’s because unrepresented buyers frequently go to open houses, which means potential new business for an agent.
It also means that those potential buyers could learn about other homes for sale if your agent talks about them during your open house. That creates an awkward situation, which may sour your relationship with the agent.
3. Looky-Loos Might Be Your Only Open House Visitors
Opening a home to strangers can be a hassle, especially if it turns out that curious neighbors and “looky-loos”—people who have no intention of buying—are the only visitors.
Lots of people who aren’t in the market go to open houses out of curiosity or to get ideas for their homes. And while it may be a fun way for them to get decorating ideas, it can feel like a big waste of time for you. After all, serious buyers can contact your agent directly to get a showing.
4. Open Houses Can Attract Thieves and Burglars
One of the risks of an open house is that you could be the victim of theft. Since anyone can go to an open house, it creates an opportunity for thieves to steal cash, jewelry, electronics, and prescription drugs. They can even steal your identity if they get hold of bank statements, credit cards, passports, or USB flash drives with sensitive information.
Also, savvy criminals can use an open house as a way to scope out your home for a future break-in. While it’s difficult to estimate how many thefts occur during or as a result of open houses, some police departments around the country have issued warnings to homeowners and real estate agents about the risk of being robbed.
5. Open Houses Cost Money
Time is money, and the longer it takes to sell your home, the more costs you will incur—including the cost to host open houses. There are generally candles, cake, and drinks, for starters. Also, you may have to run the air conditioning or heat more than usual, which means a higher utility bill.
Don’t forget the time, cost, and stress of keeping the house in show-ready condition and getting the kids and the pets out of the house. These little things may not seem like a lot, but they can quickly add up, especially if you host multiple open houses before you find a buyer.
Percentage of Realtors who suspended holding open houses at the beginning of the coronavirus pandemic, according to a survey by the National Association of Realtors.
6. COVID-19 and Other Health Risks
The COVID-19 pandemic has curtailed open houses because many sellers don't want strangers in their homes, and many buyers don’t want to risk going into someone else’s space.
It could be that in the post-COVID world, buyers and sellers still might shy away from open houses. If that’s the case, then professional imagery—including high-resolution photographs, virtual video tours, and drone footage—could become even more important to buyers and sellers alike.
The Bottom Line
Rewind a couple of decades, and open houses were one of the few ways that buyers could see homes for sale. Today, however, the Internet makes it easy for buyers to search and view homes online.
As a result, the open house isn’t such a winning proposition anymore. Not only does it take time and money, but also, you are taking a risk by opening up your home to strangers. Add data that doesn’t support the effectiveness of open houses, and it may make more sense to put your efforts elsewhere.