Open House Inspections – Do They Work?
Critics claim, a negative of open inspections – is that during a busy viewing the potential buyer doesn’t have as much time as they would have had at a private viewing. They claim nosy-neighbours, looky-loos, unqualified prospects attend as well.
Security has been mentioned as a concern at open inspections.
“Also the selling agent is not going to be able to have a good lengthy discussion about the property with each potential buyer”
Short timeframes and restrictions can also limit the appeal of an open-for-inspection tour for buyers.
“On the positive side of the ledger, however, the Open House Inspections approach allows large groups of people through your home in a relatively short timeframe, maximizing a property’s exposure to potential buyers. You don’t have to make 30 separate appointments (for potential buyers to visit),” says Ms. Spencer, who has worked as both a real estate agent and a buyers’ agent in a 25-year property industry career.
She goes on to say “I guess the positive is that you are at home for 30 minutes to show 30 to 40 groups and potential buyers through at the same time.’
So, which is it? Do open houses help sell homes or are they a waste of time?
Let’s take a look at both sides of the question.
Same Goals
Home sellers and their listing agents usually hold a similar view on whether or not to hold open house inspections. The homeowner believes that holding the open inspections to the public exposes it to a broader pool of potential buyers. It also means not being in a constant state of readiness to show purchasers through at any time the buyers please.
At times the owner is after a Low Key sale and for whatever reason wants less public exposure than having regular open inspections.
The real estate agent, on the other hand, will typically hold open house inspections not only to attract potential buyers but to communicate to more potential clients as well. In fact, skeptics of open house inspections will say that the real purpose of registering visitors is part of the agent’s attempt to pick up new clients.
Private Viewings
“Inspection by appointment does have its place”. says John McGrath. “If your property isn’t highly attractive from outside, but a gem on the inside, inspections by appointment may be the better option. It’s less likely buyers with an appointment will drive by and reject your home from the street without inspecting it, and during the inspection the agent will be able to emphasise the best features. Inspection by appointment can also be good for small homes because too many people at one time can make the home seem smaller”.
Real Estate Institute of South Australia says…
Open inspections are an integral part of marketing a property to its full potential and regular inspections would generally be regarded as essential whilst the property is on the market.
A sales representative is required to obtain consent from a vendor to conduct open house inspections and provide reasonable notice to the vendor (and/or occupant if relevant) of the proposed inspection date, time and duration. To attract maximum interest in the property, the open for inspection times and dates should be communicated to the general public in accordance with the marketing plan that has been agreed between the vendor and the sales representative at the time of signing a sales agency agreement.
Occasionally, theft or damage at open inspections does occur, however, this only occurs in a (very) small percentage of cases and open inspections are still crucial to help achieve the maximum sale price for the property.
Prior to open house inspections, vendors should remove any items from the property which are regarded as valuable, particularly small items such as jewellery. Vendors should also be aware that any open inspection held is at their own risk and the sales representative, unless negligent, will not be held accountable for any loss or damage. It is therefore important that vendors have appropriate house and contents insurance in place. Most general policies will cover open inspections, but to be 100% sure, take the time to call your insurer and check that your possessions are covered in the event of theft or damage and also check that your public liability insurance will cover an open inspection.
During inspections, your real estate salesperson will generally ask for each person’s details as they enter the property. Whilst this practice serves to collect details on people interested in the property, it also acts as a security precaution and discourages dishonest people from attending open inspections.
With just a few sensible precautions, the open house inspection process should not cause any undue security or safety problems and opening your home should be a positive experience that attracts prospective buyers to your property.
After each inspection, the sales representative should contact the vendor to provide detail of what occurred at the inspection and provide a report on potential purchasers.
Here are 8 Mistakes to avoid at your open inspections.
The South Australian Government – Consumer & Business Services advise buyers about Open house inspections
Go to as many open house inspections as you can to help you decide the style of home you prefer, what is important to you in a home and what you can live without.
Consider:
- home size – whether you need a unit, apartment or a house
- how many bedrooms you need
- how your needs may change over time
- yard size – low or high maintenance gardens, and outdoor living areas
- whether you want an older or newer house
- the cost and time for any renovations needed
- council regulations on renovations or extensions.
Read more in their PDF booklet It’s About the House
PS This link may stop working from time to time as the document gets updated. If it does Not Work, Please let me know via the Form Below 🙂
Security Concerns
Because potential purchasers are important visitors to your property, they are not your or the agents’ guests.
John McGrath says “Don’t forget, dozens of strangers will be roaming through your property on each inspection day and there is a risk of theft. While your agent and their assistants will be conscious of the security of your property and possessions, they don’t have eyes in the backs of their heads. So it’s sensible for you to take a few simple precautions. Lock away or remove all your valuables, especially small items such as jewellery, wallets and camera equipment. It’s also prudent to check if your insurance policy covers you for home inspections.”
So, follow this advice and ensure all valuables, jewelry, cash, spare keys, iPads, Smartphones, electronic devices or anything of value and such are locked up or put away and kept securely or taken off-site.
Make sure any medications or pharmaceuticals are secure and that all keys are out of sight including those for a wardrobe, do not leave them in a bowl, cup or such or hanging up.
You can assist by ‘Closing in the yard’ as appropriate, such as locking side gates and so on to ensure buyers can only move in and out via the main entrance.
Advise your insurance company or check with your insurance broker regards selling and having open inspections and private viewings. They may not cover any loss should it occur as buyers have been invited to attend.
Some agents will endeavor to ensure all buyers leave their name and contact details before they are allowed into the property for security and your peace of mind.
However, agents do not hold themselves out to be security guards and stipulate the agency is in no way responsible for theft or damage.
Nobody wants you to have something missing or broken.
So, you need to look after your own interests in this matter.
See also Buyer Etiquette
Having said that, after more than 30 years in the business of helping 100’s of people buy & sell their property, I’ve had 2 incidents. One was a tenant who ‘claimed’ her best CD’s were stolen even though she was at home at every open inspection and rarely left her room.
The other was a young lady who said all the doors were left open and her ‘almost empty bottle’ of expensive perfume was missing… despite salespeople checking all doors were completely locked before leaving!
The reality
Open house inspections are when a property that’s for sale is available at a nominated time and date for potential buyers to walk through. It increases the exposure to the property and allows for a large number of people to view it at one time.
Just like every time you go through a Department Store or the local shops, you do not buy anything. And when you are ready to buy, you do so because you’ve had a good look around and are sure the thing you want to buy is exactly what you wanted.
Many objectors to Open Inspections claim the online world makes them obsolete as buyers pick and choose the homes they like and can book a private viewing.
Well of course they do.
They can also easily see the property if it’s having open house inspections.
An issue with private inspection only is that images are often photo-shopped too much with super wide angled lens and that quaint patio falsely looks like it could hold hundreds of people.
Others critics say unqualified buyers are a waste of time.
Why? They simply have not been fully approved for finance yet.
Many times these same ‘unqualified’ buyers have now gotten finance approval and have bought the home.
If they were not given the opportunity to see the home earlier they may not have come to see it later.
Just as some hairstylists cut hair better than others and some lawyers are brilliant in front of a judge while others fall apart at the thought of it, some real estate agents are better at holding open inspections than others.
Agents holding Open house inspections does not preclude them from offering private viewings or inspections by-appointment as some claim.
Critics of Open Inspections claim that they as agents will show all of their registered buyers the property to view. Well, that’s a good thing… so do most agents who also hold Open Inspections, invite their registered buyers to view.
But… What do these same critics do when their registered buyers do not want that property?
Well, of course, new buyers need to be found using online and offline sources, otherwise you run the risk of not maximizing the most amount of buyers and may end up with less money by restricting the buyer pool.
The best agents will use all means to secure you a buyer at the best possible price.
Therefore, whether an open inspections “work” or not depends not only on the agent’s skill set, but on geography, seasonality and a host of other conditions.
And, after decades in the real estate and people business, I have found that including Open House Inspections is an integral part of selling a property far quicker than other methods.
Nosy-neighbours isn’t always a bad thing, many times they were looking for family members or a friend to move into the same neighbourhood.
Buyers can view dozens of homes quickly on the weekends at Open Inspections, then make appointments for private viewings later on the same day or mid-week, to have a second or third look to thoroughly check out the homes they really like.
Overall, it is effective marketing that sells a home and the most potent weapon in your marketing arsenal is your real estate agent.
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