A Brief History of the Open House

False Advertising
Creative Commons License photo credit: Creativity+ Timothy K Hamilton

In my last installment here, I promised a post titled “How an agent can advertise for free and try to drum up new business (sitting open houses) while claiming they are marketing their listing when all they are really doing is looking for new clients, and how they can even advertise for free when they don’t have a home to hold open by placing their signs that lead nowhere along the major thoroughfares at ten foot intervals so that innocent passer-bys will think they are really busy and successful.”

Now, I am the first to admit that I have never read or, for that matter, laid eyes on the Associated Press (AP) Stylebook, nor do I have any formal training in matters of journalism. But even I know that title is a couple of words too long.

Instead, I will call this “A Brief History of the Open House.”

One question we are asked at listing appointments – every single time – is about how valuable open houses are in marketing and selling homes. And when we are asked this question, we presume they are asking how valuable they are today, in 2011. In order to fully appreciate the answer, however, it is important to understand from whence this time-honored tradition materialized.

We do a lot of things in life out of habit. Often, we do these things over and over again not because there is any intrinsic value, but because we have been programmed for so long that we no longer stop to ask, “Why?” Watching the Oscars come to mind.

In the Beginning

I’m a little fuzzy on the specifics, but I believe the first open house involved Moogh and a little cave he and his family had outgrown. He wanted to sell, but absent an MLS, it was a little hard to get the word out. Sure he told Thog, and everyone knows Thog had a big mouth, but he just wasn’t getting the showings he had anticipated. (Granted, Moogh didn’t listen to his agent and refused to remove the hideous drawings of stick figures engaging in hunting and gathering activities from his walls, nor would he pay a landscaper to remove all the Wooly Mammoth carcasses from his front lawn, but that is the subject of another post.)

So, Moogh had an open house. Thor wandered in, kind of liked what he had done to the place, thumped him on the head with his club, and “Voila!” Title had transferred.

In the Middle

Shortly after that first transaction, and after Thor had successfully sued Moogh for damages because of his failure to properly disclose the fact that there was a breach in the firewall and his toilets had not been retrofitted to the low-flow variety, real estate agents emerged. And they created this system of cooperation and reciprocity known as the Multiple Listing Service (MLS). But Al Gore had yet to invent the Internet, so agents were forced to carry around books – books that were republished monthly – showing all of the active “listings.”

The agents now had access to the entire inventory of homes for sale, but it was their little secret. Unlicensed civilians who had even a passing curiosity were left with two choices. The brave and fearless would dare to cross the threshold of the Broker Office, only to be body blocked by two or more agents manning the “up desk” that particular day, agents who would compete to hog tie the customer long enough to stuff them in the backseat of their stylish sedan while at the same time attempting to bludgeon their coworkers to keep them away from “the live one.”

The unlicensed civilian’s second choice was to drive aimlessly around random neighborhoods in search of yard signs each weekend, hoping for a less committal, more non-confrontational way to find and see properties.

Somewhere Between the Middle and Today

The “open house” concept took off. It was genius. The first event was probably a fluke, wherein some innovative, forward-thinking agent suspected that holding court at her listing on Sunday afternoon might be her ticket to avoiding suffering through the Final Four broadcasts with her cave-dwelling mate. And, in all fairness, she suspected that there might be folks out there with some latent demand or a fear of commitment who just needed some easy access to the property. She was right. But a funny thing happened.

People came, and by “people” I mean people with checkbooks and at least a passing interest in buying or selling a home. In the industry, these people are known today as “leads.” And somewhere along the way, agents starting seeing the open house, not so much as a strategy for marketing a home but, as a way of marketing the agent. The goal, sadly, became less about selling that home and more about selling any home.

Remember, though, there was still some inherent value to the seller. Absent having the entire MLS laid out across their computer screen for the taking, the customer had to rely on the agent or his own cunning to discover the offerings. And, of course there was the classifieds section of the local newspaper.

Open houses were advertised in this place – nearly all of them, because agents knew that’s where the buyer eyes were.

Then, the newspaper died.


Today, agents are still holding open houses like nobody’s business. And sellers are still letting them – sometimes even begging them. The problem is that now we do have that Internet thingy, a thingy that has effectively put the MLS in the customer’s hands and at the same time supplanted the newspaper. There is no longer one place to advertise open houses. Where open house signs used to be a directional necessity (Moogh’s would-be buyers didn’t have Thomas Guides, MapQuest or GPS), open house signs have become the only real way to “advertise” the event. Consequently, the traffic you will expect on any given Sunday includes:

  • All of your neighbors wanting to confirm the rumors that you haven’t cleaned your oven since 1937;
  • Folks heading home from their place of worship and needing to kill a little time to miss the rush at Denny’s;
  • Trollers who have a passing interest in buying some day, maybe when they get a job, and stumble into your home only to find that it exceeds their price point by five digits;
  • People sent by their agents because it was more convenient for the agents than getting all dressed up to show the home themselves, particularly given that the Final Four games are on TV today;
  • People looking to buy direct or, as we call them, “listing agent shoppers,” because they have their eyes on a piece of the paycheck; and
  • All of your neighbors coming back through, this time with their significant others, to point and gawk at the cinder box that is your oven.

I am the first one to admit that, on occasion, an open house visitor will in fact be the one who writes an offer and closes escrow. But, here is what you need to know. This is a very, very low-percentage play, and on the rare occasion this happens, they would have likely seen and bought the home anyway. They would have come with their agent, or they would have scheduled an appointment. As a seller, if you are going to be gone all afternoon anyway, or if the home is vacant, there is no harm in having your agent sit an open house. And if you are going to have one, the best time would be that first weekend when you are new to the market – a “coming out” party of sorts. Just have realistic expectations about the outcome.

Before I get to the big wrap-up, I have to get back to the whole issue of open house signage. Signage is intended to direct traffic to your home. So, as you are headed out next weekend to commandeer the guacamole for the big game, take a gander along the parkways. One sign at a corner is directional; forty-seven signs placed at two-foot intervals, each trumpeting the agent’s name in 140-font are for advertising the agent. Signs erected at 12:45 for the traditional 1:00 open house are directional; signs placed at 8:00 AM and removed after the sun goes down are free agent advertising mechanisms, not to mention litter. Signs placed at the driveway exiting the shopping center? Well, those are just silly – a modern-day version of the bus bench ad, only portable.

And signs that lead nowhere (yes, we are seeing more of those) are just stoopid agent tricks and an embarrassment to our profession.

Big Wrap-up

Open houses used to have a purpose. They were a way to expose a home to potential buyers who might not otherwise have been aware of the listing. Today, they are mostly a goofy throwback to a simpler time when agents owned the information and no one owned a computer. Today, they are a fabulously free way for agents to advertise themselves by both emblazoning their names and logos in your psyche with their signs and by getting face time with lots of people at once.

Having said that, and although some will undoubtedly disagree, open houses are not entirely without merit. For the new listing, an open house is a way to channel the initial surge of showings into a scheduled, three-hour period. If your property is vacant or you were planning on being away for the afternoon anyway, there is no harm. Just remember that it is a small-percentage play, a very minor strategy in the marketing arsenal. And make sure that your agent, in holding your home open, is doing so with the goal of selling your home, not just selling any home or advertising himself.

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