A broker’s open house offers local real estate agents the opportunity to preview a property on behalf of their clients. The exclusivity allows agents to evaluate a property on behalf of their buyers.
The tour is a key marketing tool for real estate firms targeting a highly qualified group of homebuyers working with the agents attending the broker’s open house. It’s also a smart place to network with other agents.
Homes shown on a broker’s open house sell faster and for more money. There is more to this strategy than meets the eye.
Definition and Examples of a Broker’s Open House
A broker’s open house is a showing exclusively for real estate agents and industry professionals. The purpose of an open house held solely for other real estate agents is to market the home to other agents with prospective buyers, generate interest in the property, and ask for feedback on the property.
The open house is typically for agents who specialize in the neighborhood in which the home is being sold. Often, it is held in a “caravan” or group tour alongside other homes for sale in the area. It’s typically held on the same day in the middle of the week when agents are less busy with clients.
- Alternate names: Broker’s open, broker caravan, broker tour
Broker’s open houses are effective in certain situations, said Khari Washington, a Riverside, California-based broker, in an email interview with The Balance.
“Broker’s opens are a lot less important than they used to be,” he said. “However, broker’s opens make sense for homes that have unique features.”
For example, a broker’s open house is logical if a home:
- Has an amazing view
- Is older and was painstakingly remodeled
- Is in an area that many people don't know has quality houses
“A tour could help highlight those things,” Washington said. “Those agents can then let their clients know not to overlook the house.”
How a Broker’s Open House Works
For a home to be included on a tour of broker’s open houses, an agent will place that home’s listing with the local Association of Realtors. To get on the tour list, agents must ask to join within a certain time frame—usually one week prior to the tour.
After the list is compiled, it is sent to all agents who are members of the Association of Realtors in the area. Attending is optional. It is common for agents to attend tours in a caravan, in which multiple homes listed on the tour are visited one after the other. Caravan open houses are typically divided up by a common area or neighborhood to minimize travel across town.
Listing agents will often ask for feedback on pricing, marketing strategies, curb appeal, and other variables during the broker’s open house. They can also highlight the unique features of the property.
Agents who attend broker's open houses can ask questions about the property so they’re better able to answer those questions during a private showing with their own clients. Agents also use the broker’s open house as an opportunity to network.
Mark Washburn, a Realtor based out of Naples, Florida, has found a broker’s open house to be very beneficial for his clients. Some advantages of holding a broker’s open house include the following, he noted:
Introduce your home to a larger pool of qualified leads
Agents representing potential buyers for the home will attend the broker’s open house. After previewing the home, they may request a private showing for their buyers, potentially leading to a sale within a compressed time frame.
Create demand for the home
“Each broker may have several interested clients, creating a sense of urgency as well as a bidding war that drives up the price of the home,” Washburn said.
Accelerate the sales process
Washburn relates that many of his clients were able to sell their homes through a broker’s open house without having to hold a traditional open house. They bypass the inconvenience of an open house held on the weekend.
Receive professional, constructive feedback on your house
Other agents attending can offer feedback on the price—and even on how to make the home more attractive and create more curb appeal.
“The ability to create demand and shorten the sales process while getting a premium for your home are just a few of the reasons we believe a broker’s open house to be an effective marketing and sales tool,” Washburn said.
Should You Have a Broker’s Open House?
While there are a lot of benefits to holding a broker’s open house, it may not be necessary in today’s real estate market. Buyers and buyers’ agents have access to more data than ever before, not to mention instant notifications when a new property hits the market. Many home sellers and listing agents question whether a broker’s open house is in their best interest.
Michael Chadwick, a real estate agent with The Corcoran Group in New York City, is a supporter. “Brokers control the buyer pool, so if you want to sell a home the fastest for the most money in the shortest amount of time, you need to mobilize and incentivize the brokerage community,” he told The Balance in an email.
Chadwick believes it is a good strategy to make sure every real estate agent in your market knows you and comes to your open houses. “The more brokers know about it, the more buyers you will get through your door,” he said.
Broker’s Open House vs. Traditional Open House
The difference between a broker’s open house and a traditional open house is the guest list. In a broker’s open house, only agents and real estate industry professionals are invited. A traditional open house is geared toward potential homebuyers, even though less than 6% of sales resulted from an open house. There are several other key differences:
|Broker’s Open House||Traditional Open House|
|Only agents can attend||Anyone can attend|
|Agents can network with other agents who may have the right buyer for the home||Agents can meet new buyers who could potentially become clients|
|Agents have qualified buyers ready to buy||Homes that have an open house for the public sell for $9,000 more and spend less time on the market|
|Generated interest may cause a bidding war and sell the home for more money||Rarely are homes sold to attendees of an open house|
- A broker’s open house is a showing exclusively for agents, not homebuyers.
- Broker’s open houses make sense for properties with unique features. These might be homes with a view, properties that have been fantastically remodeled, or homes in a location with quality homes that buyers don’t typically consider.
- By showcasing a property in a broker’s open house, a home may sell faster and for more money by creating demand.
- Agents who attend a broker’s open house are better able to answer questions about the home because they’ve prescreened it.
National Association of Realtors. "2020 Home Buyers and Sellers Generational Trends Report," Page 53.
REALTOR Magazine. "Open Houses Can Still Pay Off, New Study Shows."