Matthew Ferrara, Philosopher
 

The New Open House

It has often been said that is a contact sport. If so, then every opportunity to work closely with consumers is a moment. Real estate professionals know that it’s all about relationships. So it’s important to never let a good moment go to waste. If you’re serious about a career, then selling means more than just showing up. And one place to start selling more is at the Open House.

For whatever reason, a dangerous self-deception has grown into a well-worn cliche in the real estate industry: The customer doesn’t want to be sold. Unfortunately, if we believe this to be true, we’re only going to see more brokers leaving the business. While it may be true that consumers don’t like “hard sell” techniques – the kind of pink-tie-pushy we equate with used car salesmen – it’s dangerous to think there isn’t a place for good sales techniques. In fact, the most successful – and trusted – professionals are always selling. A recent poll of most trusted professions in Australia included jobs that include constant selling – hairdressers, plumbers, bartenders and mechanics all make a living by selling and up-selling their goods. Even sex workers – perhaps the ultimate sales person (and ranked higher than real estate agents in the survey) remind us that sales is the name of the game.

So it’s time to put the contact (so to speak) back into real estate contact management!

For starters, let’s diagnose the typical current sales activity at the typical open house. As a professional open house browser (which helps me identify growth potential for my clients) I’m always looking for the agent who will actually try to sell me their listing. Unfortunately, it’s rare. Most open house experiences with the listing agent (assuming they don’t send their assistant to sit there) go like this:

“Hi, welcome to the open house. Please sign in. Feel free to look around. Here’s a listing sheet. If you have any questions, I’ll be standing right here to answer them for you.”

End of sales presentation.

Does this kind of sales activity happen anywhere else? Maybe retail stores, where the consumer is perfectly capable of picking out a shirt or dress without much sales assistance. Or the convenience store, where clerks mostly avoid making eye contact and begrudgingly tell you where to find the tissue paper. Truth is, most complex purchase decisions require some selling. The hairdresser listens to your “desires” for a new style, then upsells her process, helping you realize how the solution meets your needs. Same with the stock broker or car mechanic. Great salespeople spend the time with the customer, assessing their situation, then offering ideas and solutions as to why their product or service meets those needs.

Yet at most open houses, barely any communication happens between the agent and the browsers. It’s all “hands off” and “non-invasive” in the mistaken belief that the customer actually knows what they are looking at – and why it’s valuable to them. Of course, it’s the kind of non-sales service that does the seller real harm, by losing the opportunity to sell the “un-seen” features and benefits of most homes.

The stuff that buyers really want to know, too.

Most buyers say that their purchase decisions were not made on visible features alone, like room sizes, colors or toilets. Gen Y’er first time buyers are at a double-disadvantage if a non-sales-person is representing the home. Not only do these inexperienced buyers – who have either lived at home or in an apartment – not know what they’re really seeing, they don’t know what they are not seeing either. Items like energy saving windows, new insulation, water treatment, efficient heating and other green features that excite Gen Y’ers aren’t “observable” features to someone who has never owned their own home before.

Thus, the greater need for salemanship when it comes to new buyers especially.

In fact, so many of the deciding factors of homes may go unknown to most people at open houses because even experienced buyers can be distracted or simply misinformed. What someone thinks they know about the neighborhood, what they believe about certain renovations or appliances, or simply what they think they are seeing could be far from the facts. And rarely do these perceptions appear on the listing sheet, that pathetic document of room dimensions and description abbreviations.

Since homes can’t be “test driven” nor returned if they don’t meet the buyer’s needs, sales presentations are even more important at open houses. Ironically, the listing agent probably had a strong sales presentation when it came to getting the listing, but they suddenly think it’s pushy or intrusive to use a presentation with buyers at the open house.

Poor sellers! If you’d only known!

What should a sales-centric open house look like? There are many excellent models to choose from: The computer salesman who starts by asking you what you’ll use the computer for, what kind of programs you need and what kind of experience you have – then proceeds to show you his products’ obvious and hidden features. The investment broker who listens to your financial goals, then matches them up with benefits of his stocks and bonds, explaining how each satisfies your requirements. The hairdresser who reads your emotional desires and suggests cuts and colors you might not have considered on your own.

In each case, the salesperson interacted, listened, and presented. At the open house, it could go the same way.

Start with an opening conversation – perhaps before permitting buyers to wander (unattended, no less) through the house.

Then, take the buyer on an accompanied tour pointing out the many features and benefits of the home. Along the way, ask questions to learn a little about their needs, and try to make connections.

Ironically, it’s exactly what agents do when showing other agent’s houses to buyers during showings. But it rarely happens at the open house of their own listing!

But the listing agent would have a tremendous advantage acocmpanying the buyers during the open house. In each room, the agent could identify key features of each room, including elements that nobody could t know without x-ray vision or years of having lived in the home. They know this because they have talked to the sellers about the hidden features. And what makes each room special!

This is where the sun rises every morning. Here are where beautiful sunsets are enjoyed. These windows save energy; Those floors are actually marble, not tile. The wiring was re-done three years ago; The insulation was upgraded last year. And here’s where you’re going to love having friends and family over for a barbecue!

Technology would be employed along the way. A tablet laptop could display additional information – pictures, diagrams, videos – describing appliances, heating or roofing materials. A sales presentation on a give-away flash drive would include additional photos, warranties, disclosures, inspection reports and other useful information. A digital camera could document the tour and immediately email photos and videos to the buyers to review again later.

In exchange for their email address. Useful for further sales contact.

And feedback from the buyers could be noted along the tour, with comments and concerns documented for sellers to benefit from later. Funny how so much feedback – on price, decor, features – goes un-gathered from so many customers every Sunday. Open houses as a market research toolm helping fine tune the competitive position in real time.

Imagine that!

Of course, it means changes to the current (stale) process. Maybe buyers would have to register for a specific time to tour the home during open house hours. Perhaps tours could start “every 15 minutes,” and buyers would be shown the home in groups. That might create competition, or at least a sense of urgency.

Who knows? What we do know for sure is that the current un-sales-like process of letting buyers show themselves around is highly unproductive. Only a tiny percentage of people make offers during open houses. Yet hairdressers, accountants and computer geeks can get people to make complex, emotional buying decisions on the spot. It’s time to get that to happen at open houses, by selling, not sitting, at the kitchen table.

  • LOVE IT! LOVE IT! This is what new home site agents have been doing for years.

  • LOVE IT! LOVE IT! This is what new home site agents have been doing for years.

  • Matt,
    Once again you’re kind of right but kind of for the wrong reasons ! You’re assuming the goal of the open house is to sell the house… that rarely happens and in fact, I believe there is very little the agent can do to persuade OR disuade a buyer from liking the home. It’s not that we don’t WANT to sell them the home, we CAN’T….. they either like it or they don’t. Sometimes letting them wander on their own is better…if that’s what THEY want.

    My open house goal is to MEET PEOPLE ! So to that extent, you’re absolutely right and that you need to engage them in conversation and the best way to do that is to point out features and benefits of the home…. BUT ONLY as a conversation starter. Since you have no idea what the buyer wants or needs, you’re simply wasting time by pointing out things they don’t care about and it’s only a matter of time before you lose thier interest and your credibility.

    Just my two cents,
    Joe Montenigro
    Broker Owner, REMAX Home Team
    serving Gloucester Twp and Southern NJ
    http://hometeamNJ.com
    http://joemonte.vflyer.com
    http://www.facebook.com/joemontenigr

  • Matt,
    Once again you’re kind of right but kind of for the wrong reasons ! You’re assuming the goal of the open house is to sell the house… that rarely happens and in fact, I believe there is very little the agent can do to persuade OR disuade a buyer from liking the home. It’s not that we don’t WANT to sell them the home, we CAN’T….. they either like it or they don’t. Sometimes letting them wander on their own is better…if that’s what THEY want.

    My open house goal is to MEET PEOPLE ! So to that extent, you’re absolutely right and that you need to engage them in conversation and the best way to do that is to point out features and benefits of the home…. BUT ONLY as a conversation starter. Since you have no idea what the buyer wants or needs, you’re simply wasting time by pointing out things they don’t care about and it’s only a matter of time before you lose thier interest and your credibility.

    Just my two cents,
    Joe Montenigro
    Broker Owner, REMAX Home Team
    serving Gloucester Twp and Southern NJ
    http://hometeamNJ.com
    http://joemonte.vflyer.com
    http://www.facebook.com/joemontenigr

  • Matthew Ferrara

    Hi John: Thanks for your comments. I guess we will have to agree to disagree, because I think you CAN learn what the buyer wants and needs when you meet them – AND still try to point out where, if possible, the open-house-property meets those needs. Buyers have already “pre-qualified” some of those needs with the property by selecting it as something to come see that day, anyway, so it may be just a matter of actually doing the selling. I know you can sell homes during open houses – it DOES happen but just NOT ENOUGH. Check out what NEW HOMES site agents do and you’ll see some examples.

    Anyway, hope SOME of the ideas work for you! Have a good day!

  • Matthew Ferrara

    Hi John: Thanks for your comments. I guess we will have to agree to disagree, because I think you CAN learn what the buyer wants and needs when you meet them – AND still try to point out where, if possible, the open-house-property meets those needs. Buyers have already “pre-qualified” some of those needs with the property by selecting it as something to come see that day, anyway, so it may be just a matter of actually doing the selling. I know you can sell homes during open houses – it DOES happen but just NOT ENOUGH. Check out what NEW HOMES site agents do and you’ll see some examples.

    Anyway, hope SOME of the ideas work for you! Have a good day!

  • Matt,

    Great advice! I’m going to share it with my agents. Our Tempe, AZ maketplace is “hot” for this kind of information!

    Have a GR8 day!

  • Matt,

    Great advice! I’m going to share it with my agents. Our Tempe, AZ maketplace is “hot” for this kind of information!

    Have a GR8 day!

  • Matt,

    Way to go in thinking outside the box for open houses and providing food for thought to create something different!

    Debbie Brand
    Coldwell Banker Valley Brokers
    Corvallis, Oregon
    Debbie@DebbieBrand.com

  • Matt,

    Way to go in thinking outside the box for open houses and providing food for thought to create something different!

    Debbie Brand
    Coldwell Banker Valley Brokers
    Corvallis, Oregon
    Debbie@DebbieBrand.com

  • Matthew Ferrara

    Awesome! Glad to help! I’m so excited to hear from people like you who are willing to share – and try – these ideas. Think of it like taking buyers on a “museum tour” of your listing. How much great information could you tell them about the home – that might make a difference! Let me know your results, too – I always like to use stories from our clients in class!

  • Matthew Ferrara

    Awesome! Glad to help! I’m so excited to hear from people like you who are willing to share – and try – these ideas. Think of it like taking buyers on a “museum tour” of your listing. How much great information could you tell them about the home – that might make a difference! Let me know your results, too – I always like to use stories from our clients in class!

  • Matthew Ferrara

    Thanks, Debbie. That’s my hope – to look for something different but that we CAN do – because sometimes what we ARE doing just isn’t enough to get the job done. Best wishes for success!

  • Matthew Ferrara

    Thanks, Debbie. That’s my hope – to look for something different but that we CAN do – because sometimes what we ARE doing just isn’t enough to get the job done. Best wishes for success!

  • Matthew,

    I couldn’t agree with you more on this issue and have been a HUGE proponent of open houses my whole career. Now, here’s my question to you:

    How could we, as an industry, do a better job “following up” with our open house guests?

    Thanks,

    Jim

  • Matthew,

    I couldn’t agree with you more on this issue and have been a HUGE proponent of open houses my whole career. Now, here’s my question to you:

    How could we, as an industry, do a better job “following up” with our open house guests?

    Thanks,

    Jim

  • This is a very solid article…could be subtitled “how lazy agents ruined the Open House and opened the door for you” While what you presented is good stuff, it is really only the tip of the iceberg for what an innovative salesperson could do in this venue, stuffed full of potential customers and clients…I know successful agents who ONLY work open houses and are doing very well…

  • This is a very solid article…could be subtitled “how lazy agents ruined the Open House and opened the door for you” While what you presented is good stuff, it is really only the tip of the iceberg for what an innovative salesperson could do in this venue, stuffed full of potential customers and clients…I know successful agents who ONLY work open houses and are doing very well…

  • Matthew Ferrara

    Paul – I like your subtitle! It’s a good point that while other agents are missing the boat on working open houses better, it’s an opportunity for those who make an attempt to improve how they do it. I also know lots of agents who not only work OH’s and sell the listing then, but they are also picking up additional buyers – AND listings from neighbors who are SO impressed at their interactive, proactive sales approach that they say, ” I want this person to represent our house, too!”

  • Matthew Ferrara

    Paul – I like your subtitle! It’s a good point that while other agents are missing the boat on working open houses better, it’s an opportunity for those who make an attempt to improve how they do it. I also know lots of agents who not only work OH’s and sell the listing then, but they are also picking up additional buyers – AND listings from neighbors who are SO impressed at their interactive, proactive sales approach that they say, ” I want this person to represent our house, too!”

  • Noel Blonquist

    The era of greed and the subprime mortgage created apathy and did not require buyer sales skills to make money. The by product of a difficult market requires the sales agents of today to become better educated and more professional. They must learn the sales techniques that will match the needs of today’s buyers with properties that they need and want. It goes without saying that the open houses of today must be different because it is taking much longer to sell a house than it did in the early 2000’s. Thank you for providing another excellent training tool to make open houses work.

  • Noel Blonquist

    The era of greed and the subprime mortgage created apathy and did not require buyer sales skills to make money. The by product of a difficult market requires the sales agents of today to become better educated and more professional. They must learn the sales techniques that will match the needs of today’s buyers with properties that they need and want. It goes without saying that the open houses of today must be different because it is taking much longer to sell a house than it did in the early 2000’s. Thank you for providing another excellent training tool to make open houses work.

  • Marie

    Great post. Allowing people to wander around an open house is way to passive for an agent to have a great amount of success with it. Terrific suggestions and analogies.

  • Homes

    Hello all
    I have been a realtor for 4 years and have done many open houses. 1 thing I hate more is the agent that follow me and my client around pointing out obvious perks of the house. From my short and productive 4 years I find that pointing out a couple important facts is a better way to reach out and start the conversation. There is a way to not be in your face and but still be part of the house experience. I do not write every persons name down but I do try and get involved, start by pointing out some information and then let them walk around a bit and then ask real estate questions.
    But following a buyer around in my experience is not the way to sell the house.
    What do you think?

    Matt henry
    Vancouver b.c