The False Promise of Open Houses

I sometimes work with sellers who want me to hold open houses.

I have learned, over many years, that open houses can be good (for the listing agent).

The dirty little secret of open houses is that they make a seller feel good, but they amount to a listing agent using the seller’s home as “bait” to attract other potential clients.

Open house visitors can be potential buyers who have yet to connect with a buyer’s agent, or neighbors who are thinking about selling and trying to figure out what their home is worth.

Sometimes, open house visitors are nosy neighbors eager to compare the seller’s home to theirs and see how they live.

And, there are the open house visitors who watch too much HGTV and are looking for decorating ideas on a Sunday afternoon.

Some agents even mail open house invitations to a seller’s entire subdivision, hoping to meet potential sellers and secure future listings.

Potential buyers who visit open houses are usually in the early stages of the buying process.

They often haven’t signed a buyer representation agreement with a buyer’s agent, haven’t obtained financing approval, and may even have a home to sell before they can buy.

In other words, they aren’t real buyers and may never become real buyers.

They’re lookers, not buyers.

Open houses can be effective in a new home subdivision with several homes for sale, but they are seldom effective with resale homes.

The bottom line?

Open houses account for a tiny fraction of all resale home sales.

Real buyers are already working with a buyer’s agent and not driving all over town on their own.

The real winner with an open house is the agent holding the open house.

 

Why I Practice Transparent Real Estate

I have long practiced what I call transparent real estate.

I reveal everything (good and bad) to my clients so they can “see through” their transaction with full disclosure and all facts on the table.

If you ask my clients, they will all tell you that I’m their trusted advisor; not someone who’s focused upon “closing the sale” or “getting the listing”.

I don’t persuade my clients to do what’s best for me; I advise them so they can make their own informed decisions.

Allowing my clients to “own” their own decisions also relieves me of the burden of having to convince them and keep them excited until closing.

My clients hear the truth about all aspects of their proposed transaction without enduring the usual sales persuasion tactics.

If challenges arise during the course of the transaction, I share my concerns with my clients instead of concealing them and hoping everything works out.

It’s a lot easier to work with clients who are motivated and capable than it is to spend my time trying to convince (“close”) unmotivated prospects to act.

And, it tends to result in a very high percentage of closings vs. sales falling through.

It’s a very rare event for me to have a listing that doesn’t sell or a transaction that falls through.

 

Boise Home Inspections

Most Boise home sales include a home inspection.

In the Boise real estate market, the buyers typically pay for a home inspection that’s done by an inspector of their choosing.

The cost for a home inspection is often $300, or more, depending upon the size of the home and the scope of the inspection.

After the inspection, the inspector will prepare a report with his findings and deliver it to the buyers and their agent.

If there are no significant defects, the transaction will proceed normally.

If the inspection reveals items needing repair, the buyers will have the option of asking the sellers (in writing) to repair those items.

The sellers can agree to complete the requested repairs, in which case the transaction will proceed normally.

If the buyers and sellers can’t agree on repair issues, the buyers can cancel the transaction and receive a refund of their earnest money.

Some sellers opt to have their home “pre-inspected” by a home inspector of their own choosing prior to listing their home.

A pre-inspection report, combined with paid repair receipts, can be used as an effective marketing tool.

When sellers have their home pre-inspected, the buyers still have the option of having the home inspected by their own home inspector.

It’s important to understand that home inspectors aren’t licensed in Idaho.

That means that each home inspector can approach inspections differently.

Note: This is a simple explanation of a complex issue.  For additional insights on home inspection issues, please call me at (208)938-5533 or e-mail me.