Real estate open houses, which have been around for generations, came to an abrupt halt in March 2020. But do we actually need them back?
On Saturday, March 14th, 2020, Ryan was hosting an open house for clients on College Ave in Guelph. It was busy, people were coming and going as they normally did. COVID uneasiness was kicking in and suddenly there was a disclaimer with every handshake “Oh, it’s OK I’m not sick”.
Weeks later, public open houses were banned.
But the big question is, do we even need open houses?
It depends on who you talk to. Looking at it from a macro perspective, real estate market is hotter than ever. This is without open houses in Guelph for over a year. This would imply (and confirm) that open houses were not a driving factor for the sale of your home.
Where it could have been positioned as a marketing tool pre-COVID, many other marketing tools stepped in to replace an open house over the past year. This would include greater reliance on photos, greater reliance on floor plans and video.
First time home buyers tend to attend open houses. They may be just starting the process and don’t have a Realtor they can ask questions to. Or they want to figure out what their funds will buy them. And the Realtor working the open houses in Guelph should be able to answer these questions.
How did the pandemic influence decision making?
Pre-pandemic, potential buyers may have looked at photos and decided they liked the house. The most logical next step (especially if they didn’t have a Realtor to work with), would be to attend upcoming open houses. Then, if they still liked it, they’d find a Guelph real estate agent . Maybe they’d come back one more time before making a decision to submit an offer.
Post pandemic, buyers better scrutinize the photos, view floorplans (which in our opinion is a must have along with 360 photos of the rooms), take a virtual tour and sometimes video. If they like it, they make an appointment with their Realtor to see it and then make a decision.
See what happened there? The role of open houses in Guelph- that extra decision- was eliminated. It still started and ended the same way. But decisions were made more efficiently and didn’t require an open house. And sales still chugged along just fine.
So why do sellers even have an open house?
There is significant debate within Realtors about this. Open house events are a no obligation way for buyers to see a house before deciding if it’s something they want to call their Realtor about. That it was just another marketing element to help sell the home. With the huge influx of buyers from area code 437, 416 and 905 they may not have a Realtor and just be browsing.
But think about this: You are a potential buyer and saw your “forever home”. But, you couldn’t attend open houses in Guelph. Would you throw your hands in the air and walk away from pursuing your dream home? Of course not.
Anyone who is serious about buying a house will make an appointment with a Realtor.
They’ll come to a private showing of their own. They were eventually going to do that anyways. We believe open houses in Guelph definitely had serious buyers attend. However, there were also roughly 50% who were just window shopping. These people had no real intent to make a decision to buy the house.
Is the main role of open houses for Realtors to gain clients?
Let’s just be honest. The role of open houses is mainly for a Realtor to gain new clients- in particular it’s a good idea for new real estate agents . After all, it’s a sales job and what better way to get perspective clients than have them walk through the door talking about buying houses!
However, the Realtor can’t lose touch of the objective- to sell the house they’re standing in, not themselves. Sign up sheets are a key indication that this is happening, because the Realtor is often going want your email address to be in touch later.
We did gain a fair number of wonderful clients from open houses, but that’s not why we were there. If someone wanted to work with us a result of an open house, they gave us their info or called us later. We didn’t ever use sign up sheets.
Should we go back to open houses?
We say no. But since it’s our clients house, if they want an open house we’ll happily do it. For buyers, it does allow them to effortlessly browse a number of houses, treating them as an information session to compare homes. It’s a great opportunity to view popular neighborhoods mid day on a Saturday, walk the living areas
Technology has stepped in and improved enough that the open house step can be eliminated. Products like HouseSigma which provide greater data to consumers, has better informed buyers on details that open houses would provide. Realtors need to up their game, which is the evolution of the role and apps such as HouseSigma
Even though the technology advances, there is still something tangible about physically walking through new homes. The flow sometimes can’t be measured by photos. Hardwood floors may have scratches that photos don’t show. Virtual open houses only show you what the listing agent wants to show. Does the bathroom really have a full bath? Or is it too small?
The other key thing our clients tell us: smell is a very important factor in decision making for a home. A strong smoke smell, a musty smell or clean smell can easily influence a decision to buy or not.
We believe open houses in Guelph definitely play a role for sellers, buyers and Realtors. But we also believe that the market has proven it can still rise (to record highs!). This is with or without them. It’s NOT necessary.
We like to think of open houses in Guelph the same way as the landline for phones. At one time people thought that everyone needed it. And they were right- everyone needs a phone. But cell phones proved that you can still have the phone- or in this case, the home- without having it attached to a wall in the kitchen.
There are some things that open houses can’t provide in your home search: some of the property listing data, public records, third party sources info, past sales history and more. But open houses are the best way to have a no obligation tour of the main level of a home.
It’s a different way to ultimately get you the same result. Beth and Ryan are Guelph Realtors and if you’d like additional information on the Guelph real estate market, feel free to get in touch!