Take a drive around some neighborhoods on a Sunday afternoon and you most likely notice a few OPEN HOUSE signs. They have been used by Realtors for a very long time. However, you probably don't know the real reason why a Realtor will hold a house open to the public.
Most people think that a real estate agent will hold their listing open to sell the property but that is not the primary reason they do it. Of course, if they do sell the property that is an added bonus but the main reason they hold their listing open is to start a relationship with the buyers that come through the open house. They are essentially looking for new clients.
Statistically, the odds of anyone buying a home this way are very small. The National Association of Realtors routinely surveys recent home buyers to find out how they found their home. A very small percentage of people list open house as the method of finding the home they ultimately purchased. They may have started their relationship with the Realtor that represented them via an open house but it is rare for them to buy the actual home where they met the agent.
Regardless of this statistic some home sellers still insist on having their houses held open. It is up to the agent to decide if it is a good business decision. Some very successful Realtors have built their business on open houses. When a Realtor uses this marketing tool it usually does one of a few things:
1) It generates new buyer clients for the Realtor.
2) Other potential sellers in the neighborhood notice open houses. This alone might cause them to call the Realtor when it is time to list their home.
3) It pleases the seller which can be good when it comes time for the Realtor to ask for a much needed price reduction.
4) The chances are small but it might actually sell the home.
Despite all of these benefits to the Realtor (not the home seller) some agents just refuse to do them. If a home has been on the market awhile without an offer many sellers will insist on their agent to holding their home open. They think that is the piece of the puzzle missing and that an interested buyer will finally drive by, see the OPEN HOUSE sign, come in and buy it. That scenario does happen but it is rare.
Don't put all of your eggs in the open house basket. If you are there is a pretty good chance you have the wrong asking price.