FSBO Open House 101
· As a for sale by owner, open houses should be the cornerstone to your marketing plan to sell your home. No other way is m= ore effective in selling your home than to allow prospective buyers to view it.=
Open House Preparation
Rule number one: Buyers do not have an imagination. Buyers almost universally see what is in front of them. They believe, almost absolutely, = what they can see. Therefore, it is important to remember that how your home loo= ks during a showing will have a significant impact on the buyer’s decisi= on to buy your home. However, you should always be asking yourself, “How= can I make my house more saleable?” The answer lies in looking at your ho= me objectively and through the eyes of a buyer.
Rule number two: Buyers are looking for excuses not to buy your house= so don't give them one. As a buyer walks through your home, he or she is looki= ng for defects, hazards, or issues that justify why buying your home isn't practical, especially for the price you are asking. Make sure you remove any potential objection or reason why a buyer would not want to buy your home--= from the foul odor emanating from the backyard to the burned out light bulb over= the kitchen sink. Failure to do so will result in losing your buyer or having b= uyers present offers well below your asking price.
Appeal to the Buyer’s Senses
It is important to understand that all buyers, like all human being, = have senses. When these senses are stimulated, buyers will experience either a positive feeling or a negative feeling about the stimuli. Your goal in sell= ing a home is to stimulate as many of these senses as possible. If you can achi= eve a positive stimulation of all the buyer’s senses, you can create an environment in which the potential buyer will be motivated to buy your home= .
Sight. The first and most important sense is the sense of sigh= t. When we talk about the sense of sight we are talking mainly about the first impression that someone gets when they see your home. Where the buyer devel= ops a first impression is usually from the street in front of your home. This is called “curb appeal.” Many buyers will make up their minds whet= her or not they are going to buy a home solely from looking at the front of the home when driving by. Have you ever driven by a friend’s or neighbor’s home and told yourself that you could never live there? In effect, you have formed an opinion about their entire home by briefly viewi= ng its exterior. The interior may be breathtaking, but you would never know it. This is exactly what buyers do. They drive by a home and try to picture themselves living in that home.
First impressions are lasting impressions. Even if potential buyers decide to walk through your home, any negative attitude they have created w= ill inhibit their ability to see the positive features of the home. What can yo= u do to make the best first impression possible? Start by taking an objective lo= ok at your home from the curb across the street. Ask yourself questions that demand critical answers. Are the shrubs overgrown? Are there more weeds than grass/rock? Does the landscaping stand out? Can you see your home from the street or are there too many shrubs and trees blocking the view? Does the f= ront entrance stand out or does it look old, dirty, and in need of some sprucing= up? Can you read the house numbers from the street or are they small, rusted, a= nd falling down? The questions can go on forever. The point is that you must l= ook at your home as if you were deciding whether or not to buy it.
The next step is to walk in your front door and take an analytical lo= ok around. Are the blinds or shades closed, thereby giving the effect of a dim, closed up, and possibly even musty room? You want to make your home look as open, airy, fresh, and clean as possible. This is achieved by opening the windows, shades, and blinds and by turning on every light, even if it is the middle of the day. A home can never be too bright. Check your light bulbs a= nd replace them with 75 to 100 watt bulbs. If this is done throughout the home= the buyers will see a bright, open and delightful home—one they would enj= oy living in.
Touch. When we talk about the sense of touch, we are mainly talking about the cleanliness of your home. Buyers will instantly be turned= off when they walk face first into cobwebs or step into a puddle that a pet has left behind. For some reason these buyers are not too interested in the amenities of the home during the remainder of the tour. Also, be aware of t= he collection of dust that is piling up on your furniture. If you are interest= ed in getting top dollar for your property, you should take the time to inspect your home for spider webs and any other detractors that could turn a buyer = off.
You should also be aware that it is almost human nature for people to touch things. Many times buyers will run their fingers along the countertop= s or over the front of refrigerators. Be sure to wipe off any lingering fingerprints, food or dust from your appliances, countertops, walls, light switches, and telephones.
Smell. When purchasing a home, the sense of smell plays as important a role as the sense of sight. Nothing ruins a sale faster than an obnoxious aroma permeating the walls of a home. By the same token, few thin= gs are as pleasant as walking into a home that smells fresh and clean.
During the open house, go as far as baking an apple pie, cookies or e= ven putting a pie tin with cinnamon and butter in the oven. Often times, smells= of baking will transport buyers to the days when they were young and used to travel to their grandparents’ home for the holidays. Another alternat= ive is to use potpourri, scented candles and scented sprays. Be sure not to ove= rdo it. More importantly, stay away from the use of incense. This often leads t= o a negative impression about the home and especially the habits of the seller.=
Do something rather than nothing. A bad smell might just ruin your da= y. But try not to overdo it. Choose how you are going to enhance the smell of = your home and stick with it.
Taste. The sense of taste is one that you might not think has anything to do with the purchase of a home. In many ways that is true; howe= ver, freshly baked desserts and coffee or cold drinks available can cut through = much of the formalities that are associated with the establishing a rapport with= a buyer. Offer buyers something to eat or drink after they have toured the ho= me. This gives you the opportunity to get to know their feelings about the home= and their motivation for purchasing. Anything that compels a buyer to linger in your home might be a successful tool.
Hearing. Have you ever entered someone’s home and had so many distractions that you could not collect your thoughts? For example, the dog barking, the TV blaring, the kids screaming, the phone ringing, and som= eone knocking on the door. When you are showing your home, you should try to generate the least number of distractions as possible. Have the family go o= ut for the day. Turn off the TV and turn on some soft music. Most people would rather hear the birds singing than the kids screaming.
Open House “Must Haves”
Giving the buyer information about your home and what it will take to= own it is just as important as preparing the house for your showings. How the h= ome shows will create a buyer’s first impression; however, what they have when they leave and the information you provide to take home with them will play a crucial role in whether they decide to return for a second look or to make an offer.
Sales Flyers—your last and most effective marketing tool. Successful sales flyers try to impact upon the buyer’s emotions. You = will want to state the basic features of your home: property address and phone number, the fact you are selling the home “By Owner,” number of bedrooms and bathrooms, square footage, other key rooms throughout the hous= e, type of heating and cooling systems, etc. In addition, be sure to highlight= the key amenities of the home: items such as a fireplace, pool, spa, hardwood floors, walk-in closets, ceiling fans, water softener, located in a particu= lar school district, etc.
More importantly, be sure to include color photos on your sales flyer. When looking at the competition’s flyers (if they have some), you will notice how drab and dreary they look—typically a black and white photocopy where someone attempted to be a graphic artist with cheesy graphi= cs and a “blah” design. A successful sales flyer will jump out from within a stack of various flyers. Ideally, include three color photos of yo= ur home: 1) a front, exterior view of the home, 2) an interior shot of the most striking room of the house, and 3) an exterior view of the backyard (an additional interior view should be substituted if the backyard is not very appealing). Insure that you have cleaned the house/exterior before taking y= our photos. In addition, turn on your interior lights to guarantee proper light= ing and exposure.
Practice using descriptive words and adjectives when you describe your home. Instead of talking about the kitchen area, talk about the work-saving, efficient kitchen. Instead of saying that your home is in a nice location, describe it as being in a convenient location with easy access to all amenities. You do not have a garage door opener, you own a time-saving, convenient, and practical garage door opener. The list can go on and on. Finally, avoid using words like “very” when you are selling benefits. There are so many words in the English language that are better suited to describe the way you feel about a particular item. If you need any further help, consider picking up a thesaurus at a local bookstore.
Financial Matrix—the home buyer’s analysis. One of= the most asked questions regarding home buying (outside of the basic questions = of the home) are about being able to afford the house. Buyers will ask themsel= ves, “What would the monthly payments be on this home?” or “How much do I have to put down in order to buy this home?” Most home owne= rs do not know the answers to these and other questions. However, not having t= he answers to these questions will leave doubt in the buyer’s mind that = they cannot afford the home. As they are viewing the showing, many buyers will f= ind reason to justify why they cannot afford it and pick apart every aspect of = the home that they can find fault with. This is definitely not what you want go= ing through the buyer’s mind and once they leave through the front door, = they typically do not show up again.
Your task as a home seller is to show your potential buyers just how = easy it is to afford your home. As soon as someone walks into your house, give t= hem a copy of the financial matrix. This will give them the answers to their financial questions—down payment, monthly payment, closing costs, etc. That way as they are walking through your home, they are focused more on the house itself, not the financial burdens of owning it. They can see the home= in more of a positive perspective, dreaming of the home’s potential for them.
Self Prequalification Test. The third item you will need for a successful open house is a self prequalification test that allows the poten= tial buyer to prequalify themselves at their own leisure. This tests asks the bu= yer a series of questions necessary for qualifying to buy your home and indirec= tly shows them just how easy it is to buy your home. Unless the buyer has alrea= dy been prequalified for a home loan, make it easy for them to buy your home by showing them how easy it is to qualify to buy your home. Be sure to place i= t in a conspicuous place in the home (a kitchen cabinet or bathroom mirror). That way, they are guaranteed to read it.
Sign In Sheets. In light of the many security hazards that are present when showing your home, it is vital that you keep a written record = of everyone walking through your showing. You must insist that everyone that wishes to view the home sign in before walking through. By doing so, you ha= ve a list to give to the police should an item be broken or stolen. Equally important, your list should give you only the names, addresses, and phone numbers of your “potential buyers” so that you can follow up af= ter the showing to try to overcome any objections and close the sale of your ho= me. Follow up is crucial in any type of sales and as a seller, it is important = that you get their feedback about your open house and everything it has to offer= .
Appraisal Report and/or Market Comparables. Many savvy sellers will have available to their open house guests a listing of recently sold h= ome or an appraisal (if they had one done recently) to show how they arrived at their asking price. By having this information available, a potential buyer= is reassured that the asking price is justified and not an arbitrary number ma= de up by the seller.
Property Disclosure Form. Though not required for an open hous= e, a property disclosure statement allows potential buyers to analyze the condit= ion of the home they are viewing. Many people fear buying resale homes because = of hidden or undisclosed defects with the property. By having this information available during your open house, buyers can see for themselves how well you have cared for your home and are able to make an informed purchasing decisi= on without the fear of buying a “lemon.”
Blank Sales Contracts. You never know when someone will be rea= dy to make an offer. Don't give them an opportunity to think it over because chances are they will pass on the deal and you will have to do it all over again next weekend. Also have any additional contract forms that you may de= em necessary. These forms may include pre or post possession agreements, acces= s to premises agreements for the buyer, contingency addendum (such as having to = sell a home before closing, etc.), and other forms and disclosures that you must include by law with the purchase contract.
Open House Security
Many sellers have the false impression that they are required to let everyone in to their home during an open house. Though it is a good practic= e to show your home to as many people as possible. However, you do not have to l= et just anyone in. I'm not talking about excluding a person or a group a people based upon their race or ethnicity. Rather, use your judgment when allowing= people to walk throughout your house.
When conducting an open house, follow these rules to avoid any potent= ial security problems:
· Don't tempt people to steal something. Secure anything of value, such as jewelry, guns, cash, coins, prescription drugs, = etc. Don't hide them in obvious places such as a jewelry box or sock drawer. The safest place to store these items is in the trunk of your car. If this is n= ot feasible, at least hide them in less obvious places (i.e. under the trash l= iner in the trash can in the bedroom, hidden in shoes in the closet, etc).
· Put away receipts, bills, and credit card statements. Don't leave anything out that can be copied, pocketed, or stole= n.
· Don't talk about the valuables you do have. Though this may seem pretty obvious, every now and then a seller will be pr= oud of something expensive (such as a rare coin or stamp they just bought at auction) and say something in passing. Also, don't discuss your living habi= ts, your schedule and even your lifestyle. The more a stranger knows about your habits, the easier it is to predict when you are home and when you are away (besides, what does your personal life have to do with the sale of your hom= e?).
· Have everyone that visits your open house si= gn your guest register. Some sellers go as far as requiring picture ID (though= I would say this is more of a judgment call on the part of the seller). If someone is not willing to give their name and address (and possibly their p= hone number), don't let them in. If this happens, ask yourself this--How serious= of a buyer is this person refusing to sign in? Chances are they are not very serious and in many cases are only there to check out what you have.
· Never have an open house by yourself. It is always a good practice to have two people there--one person to great incomi= ng viewers and another to shadow other people walking throughout the home.
· Always make sure people are accompanied throughout the house. Never leave people to wander by themselves. Though you have to make sure you don't hover over them (people like a little space), i= t is always important to make sure they know you are there (besides, this allows= you the opportunity to answer any questions they may have if they come up).
Showing the Property
Before opening your door to the world, be sure you are ready to show.= As mentioned previously, the key to a successful open house is preparation. Ta= ke a few seconds to race throughout the house and double check each room, making sure the lights are on, the windows are open, and that everything is in pla= ce.
Approximately thirty minutes before the open house starts, place your directional signs (the smaller signs that say "OPEN HOUSE" with an arrow to direct traffic) at major intersections in your area and lead peopl= e to your home. Generally this requires four or five signs (especially if you pl= ace a sign on each side of a busy street to direct the traffic your way). Be careful of local sign ordinances that may restrict sign placement (such as placement in a right-of-way, on sidewalks, or on other people's property). = As stated in be sure to purchase professional looking signs. Hand crafted, magic-marker-colored signs might be okay for a garage sale, but your signs should portray you as a professional selling a quality home. Also, turn on = the sprinklers for about 30 minutes to give the grass a little sparkle.
As people stop by your home, greet them with a friendly "hello", hand them a sales flyer detailing the home, and have them sign your guest book. As they are filling out the register, highlight the m= ajor features of the home to include:
· number of bedrooms
· number of bathrooms
· square footage
· key features that appeal to most buyers (suc= h as a gas fireplace in the master suite, the pool with 4.5 horsepower pump and = self cleaner, etc)
Have someone accompany them throughout the house. As they walk from r= oom to room, point out the strong points for each space. Give them adequate tim= e to view each room and refrain from intruding into their conversation among themselves. Most importantly, do not hover. Allow them enough room to feel comfortable talking among themselves while letting them know you are still there.
To be truly effective during your showing, you and those assisting you with the showing must be prepared. Be sure to review the following before t= he open house:
· Know the home: the types of appliances in the home, the types of services (i.e. gas, electric, water, etc)., the features= of the home
· Know the neighborhood: the area schools, loc= al grocery stores, parks, shopping malls, crime rate, etc.
In addition, emphasize to everyone involved in conducting the open ho= use that they should be polite and friendly--even if someone says something negative or critical about the home. Avoid arguing with people coming throu= gh the open house. You may win the argument but you will lose the sale. If you= or anyone else is asked a question, be truthful about the answer. Avoid exaggerating or embellishing your answers and if you don't know the answer = to a question, tell the buyer you do not know. Just let them know that you can c= all them later with the answer (assuming they wrote down their phone number in = the guest book).
For more information on handling objections and negotiating a contrac= t.
Expect real estate agents to stop by your open house. Regardless of t= he fact that you may or may not want to speak to an agent, be friendly with th= em. If you are not interested in what they have to say, tell them that you are = in the process of selling the home yourself and that if you need the services = of an agent, leave a card so that you may contact them when you are ready. For more information on the games that agents play. Remember, agents are in the business of finding buyers.