Ruth,

Your homes seems lovely. If the comps indicate (I don't know anything about your area so I can't give you an opinion one way or another on your value) your home is worth easily over $1M why are you offering your home so far below value? Sometimes this is a harmful strategy - buyer's wonder what's wrong with the home...

Knowing that most buyers in your price range will come via agents, and this advice may seem self serving coming from a Realtor, but I do recommend that you relist it with a broker. Interview to find an agent that specilizes in homes priced just above your homes value and has a national or international marketing plan.

A buyer for a $1M home has to have earnings of aprox. $350/year which in the Chicago area is a pretty large segment of the population but still a harder buyer to find than a buyer looking for a $300K home.

I am a Guild member of the Institute for Luxury Home Marketing. Guild Members have to have closed a minimum number of million dollar + residential sales to gain entry. You can check out their website at http://www.luxuryhomemarketing.com/ I don't know if you can search members on the site if you're not a member but you could certainly call and ask for agents in your city or zip code.

Good luck to you!

Sun Jul 29 2007, 16:24

Thank you EisnerFeldmen for the advice I knew in my gut but was afraid to hear and hadn't been told by the local professionals. I think my agents were influenced by the unqualified $400k buyers coming through the open houses. I've looked at houses in the $800k price range of my home and they are a third the size and not rehabbed. I haven't seen most of the houses that are likely comps in $1mil range because they don't have open houses. But the few I have seen for $1.1 and $1.2 are comparable and now under contract.

I hired and fired my real estate "team" office in which I don't think any of the agents working with my home had even been in a home over $1mil. The average house in the area is $400k. The office has two agents who have worked with the over $1mil category. Just before firing the agency, the broker said he doesn't control the two top producers and they hadn't seen the house because they are too busy.

As to the statement about not being able to qualify buyers attending an open house, I have had unusual success there. I've had 3 FSBO open houses with about 5 groups attending each and completing at least part of my sign in sheet. After the open house, I Googled the names and Zillowed the addresses. Everyone who gave me their address had Zillow values of under $350,000. Those that didn't give me addresses, I found some of them on Google and their jobs showed that they could likely afford an $800,000 home. One person who didn't seemed qualified at all and wasn't in Google did show up as owning multiple properties in Cook County Recorder of Deeds (unusual name and other information he mentioned in our conversation confirmed I had the right person).

I think Open Houses are the first step and the attendees are not ready to buy NOW but they will be. The problem is that even if they loved your home, by the time they are ready to buy (i.e. sold their home) if your house is still available they don't want it because no one else wanted it.

Sun Jul 29 2007, 13:15

I agree with my colleagues and they have given a lot of good feedback. I have sold 3 homes at open houses. If I counted all the open house visitors I have greeted in 10 years, it’s actually a very low percentage. It can and does happen.

Open houses are not the first priority in a marketing mix, but they do have their place. I do not find open houses beneficial for high end homes, and high end is relative to the marketplace. I recommend that you not throw the possibility of an open house out the window.

Positive results aside from a direct buyer resulting at the open house include:

Neighbors who may preview and be the cheerleader for your property telling their friend’s cousin what a fantastic neighborhood it is, and your house is super. Neighbors won’t make an appointment to see the home out of curiosity, but may attend an open house.

Realtors may stop and preview the property.

An open house visitor may pass on positive feedback to others, stating it wasn’t for them, but is a great property.

A buyer can result from this domino or 6 degrees of separation approach. An open house could have been the catalyst of property sales that we are not counting.

Bottom line: I agree with all the prior comments outlining the benefits for the agents, and the unlikelihood that a buyer will result. Still, one or two open houses may have a place in a complete marketing program.

Best of luck!

Sun Jul 29 2007, 09:07

Hi Gina,

Open Houses for the most part benefit the Agent. I wrote a blog about this a few months ago and am putting it here as a reference. You'll see that the majority of the agents that commented on the blog feel this way as well.

Having said that, you should always have an open house for brokers to tour/preview your home and the first weekend your home goes on the market. This should be part of your marketing strategy.

Good luck in the sale of your home,
Irina

Sun Jul 29 2007, 08:33

I have never sold a home through an open house, however, I have picked up several listings through them. Neighbors thinking of selling are usually the first through the door. Open houses are a great source of leads.

Sun Jul 29 2007, 01:27

I have had a couple of listings sell at an open house. In most though this is not the case. It does, however, increase awareness of the property which does benefit the seller. Many agents who hold open houses will find a new client during the process. Open houses will in the long run benefit both the seller and the agent. I personally do not find it is the most and best use of my time.

Sat Jul 28 2007, 08:27

Open Houses have the potential of doing both:
(1) It can benefit the seller, because the need is just one qualified buyer who wants the house. The issue is, who knows where that person is on any given day. The probability of a home selling via an Open House is slim and I make sure that my clients are aware of this. If only we knew where and when.

(2) It can benefit the Realtor because it puts them in a situation in which they are exposed to an area or community. Just like the seller doesn't neccesarily know where the buyer is coming from agents at times do not know where the next client is coming from. Increased Realtor exposure also has the potential to increase listings.

I acutally got a new listing as the direct result of the neighbor attending the Open House. While we think nothing is going on someone is paying attention.

Open Houses should be looked as simply a tool for home exposure and an element of a multi=pronged approach.

Sat Jul 28 2007, 01:31

Open houses are one more method of exposing the home to the greatest amount of people, Gina. Typically it doesn't sell the home that day... However, with my open houses it gives me a better chance to promote the house. I send out postcards to the neighbors, put the house in the newspaper, not only under my featured listing, but also in the open house section. I use many directional signs and try to draw as many people there as possible. I've never had one of my listings sell this way. I have, however, seen more activity afterwards from the increased exposure and many times find the home selling right after an open house.

It is an excellent method of meeting buyers and sellers as well.

Fri Jul 27 2007, 18:48

In my experience, open houses are a great promoting tool for an agent. Especially if the agent is new. It allows the agent to meet people face to face and (if they have done their homework) allows them a chance to pull the old switch-er-roo. But here's the thing, we never know where that buyer for your house is going to come from. An ad call, a friend of a friend, or an open house. Exposure is the key. For your house and your agent. The more people that know your agent, the more chance he/she will have to sell it. And the more people that know your house, the better chance you have at someone buying it.

Fri Jul 27 2007, 18:40

Another personal perspective - I've purchased my last two residences at open houses - just as they hit the market.

As a broker, I do indeed gain new buyers from opens. I've rarely found a buyer for the home I'm holding open, however. Though we never know exactly where the eventual buyer will come from. Exposure is everything. So whether it serves to please my sellers or not, I do them anyway because you just never know.

Fri Jul 27 2007, 15:49

I have answered this type of question in the past and thought I'd chime in with a success story.

Although, statistically the odds were against me - I still sold my personal home thru an open house... ergo' the moral of the story is - Leave no stoned unturned...

Fri Jul 27 2007, 15:40

Open houses do both!

Open houses are a part of any marketing mix - but frankly they are a waste of time and an actual liability on higher end homes (anything more than 3x median home price in the area)

Open houses for homes that are no more than 1.5 times the median home value or less for the area are well worth the time and effort... OR homes that are bargain priced in their immediate area can yield wonderful results. I've certainly sold homes to buyer's met at one of my open houses.

Who goes to open houses? Generally people looking on their own for a home. Who looks on their own? People with time on their hands who for whatever reason have not employed a "free" realtor to do the work for them...

Sometimes these efforts yield new clients for the listing agent but why is that a bad thing? Not every home is an immediate match for the first buyer that sees it - but unseen is unsold - so get it seen.

The challenge with open houses is that you can't qualify the buyer's who walk through the door (this is why luxury homes don't do well with open houses). But most people who are serious about looking will drive around on the weekends looking for open house signs - or will just drive through neighborhoods in an area where they would like to live and see what's for sale. Your savy realtor will put up a little rider sign a good week to 5 days before their open house that says "open Sunday 1-4 pm" or whatever their open date is. This way everyone who's been driving through all week can make it a point to come back and see the house if they like the neighborhood.

For some reason where we are, advertising open houses in the paper is a total waste of money. It seems to just be best if you put out signs on the busiest close street and direct traffic in with directional signs.

So if your home is near the median home value then I highly recommend open houses. If your home is priced as a 2x+ multiplier above median value then those buyers have high time value and are probably working with an agent who will find you in the MLS in an efficient manner and see your home on their schedule through the traditional route.

Hope this helps!

Fri Jul 27 2007, 15:25

I sell about one property per year as a result of a buyer coming to my open house. I agree that it is a slim chance that this will happen but you can't ignore the fact that it indeed does.

Fri Jul 27 2007, 13:10

I'm assuming that you are talking about public open houses. The statistics show that less than 1% of homes actually sell during an open house. So, there's always the chance, however slim. Most agents do them because 1. their sellers want them and 2. it brings them potential buyer clients--which all agents want in this market!
If you are talking about broker open houses, I would recommend them as a benefit to the seller. That is the way agents learn their inventory, first-hand. (Not all areas of the country hold them, though.)

Fri Jul 27 2007, 12:20

In today's market, even the extavaganza doesn't seem to work. Yes we need to expose the property to more people, but from what agents tell me........right now O.H. does not work.

Fri Jul 27 2007, 12:18

This comment is from another thread, but here you go:

I recommend Broker’s open houses… In my experience, this is the only way to go. But it has to be really special, a social event—prizes, gourmet food, invitation only, open bar (liability issue, be careful!), etc.—to lure the best agents. The top agents in the area are probably representing anywhere from five to 25 buyers at any given time. If you get only 10-15 good agents to attend an open house, exponentially, the featured property is being exposed to anywhere from 50 to 375 qualified buyers! Of course, this is a great expense, and only warranted for high end listings or co-sponsored events. A typical open house, even when well staged and advertised, produces few to no buyers for the featured property. At best, the listing agent (or hosting REALTOR), will gather a handful of buyer leads—not at all helpful to the seller of the property in question.

Fri Jul 27 2007, 12:07