It’s open house season! You perhaps thought these balmier temperatures and tulips indicated a season called spring, but no, tis the season of house buying. The inspiration for today’s post comes from a reader who recently sent me a fantastic question about one of my favorite things… open house etiquette! Before Mr. Frugalwoods and I slapped down the money to buy our current home, we frequented a ton of open houses. And by “ton,” I mean roughly 270+ over the years.
The Young Frugalwoods vs. A Hot Real Estate Market
When we first moved to Cambridge, MA (as dewy-eyed, engaged 23-year-olds… sidenote: that sounds REALLY young), our #1 financial goal was to buy a house. And this wasn’t a typical goal in these here parts. The Boston metro area (of which Cambridge is part) comprises the third most expensive real estate market in the country and, to make matters worse, the housing supply is extraordinarily limited.
Most properties here are rentals (in fact, 65.4% of units in Cambridge are rented) and, very few new buildings are built thanks to stringent historical requirements, which we do appreciate since the city is a beautiful amalgamation of historical landmarks and homes.
This truncated housing stock causes some area buyers to foolishly forgo home inspections (which we would NEVER recommend), buy houses in terrible shape, and–here’s the kicker–pay all cash. All that to say, we recognized we were facing terrible odds. But, we weren’t deterred in our dream of home ownership and eventual landlord-ship. And given the high rental rates in Cambridge, we figured we’d eventually want rent out our home, which is exactly what we plan to do with our current house once we decamp to a homestead in the woods of Vermont in 2017.
Our DIY Home Search
At age 23, living in a dank basement apartment to save money, we realized our home plans were too nascent to involve a realtor. Plus, as you know, we have a preference for insourcing everything we possibly can and, we didn’t want to waste a realtor’s time.
So, we DIY’ed our home search process and started what can only be described as the Frugalwoods Open House Visiting Bonanza. Basically, we went to just about every open house we could get our hands on in our target neighborhoods. While we did indeed have a price range, and were in fact ready to put in an offer if the right property popped up, we weren’t seriously ready to buy. But we were seriously ready to gather information.
And so every weekend, Mr. FW would map out a route for us to walk around Cambridge and poke our heads into stranger’s homes. We looked at everything from $1.5M+ listings (which we could never afford) all the way down to the “cheap stuff,” which in Cambridge all those years ago was… about $350K (this is not a discount area). By exposing ourselves to such a broad swath of properties, we were honing our preferences for a home. We’d take the listing sheet for each house, then sit down over coffee later that afternoon and have a serious conversation about which house we’d buy if, you know, we were actually in a position to buy.
Every Open House Is A Case Study
What these exercises did for us was of incalculable value. We educated ourselves on the intricacies of viewing homes, we determined our priorities, and we learned how to communicate our desires and thoughts to each other. Essentially, we conducted a case study on every open house we went to and created a vocabulary for house hunting unique to us and our frugal weirdo brand of loving value, but also of appreciating beautiful architecture and historical detail.
We didn’t buy the cheapest house we looked at and we don’t regret that. Since we spend so much of our time in our home, we wanted a place we’d be comfortable in, that was spacious, and that brought us joy every time we walked through the door.
When Mr. FW and I moved to Washington, DC a few years later, we continued our open house visiting, even though we were fairly certain we wouldn’t be staying in DC long enough to buy a house. Why would we do this? To gather more data. With each house we visited, we learned a new real estate term, a new legal angle, a new home layout, and we practiced and refined our technique for “choosing” which house to buy.
Date Before You Buy
We also weren’t losing anything by going to these hundreds of open houses. They’re free, open to the public, and often take place on glorious spring–ahem, house buying season–days. Who doesn’t want to stroll around town and snoop in stranger’s houses on Sunday afternoons? In case you hadn’t guessed, yes, we do consider open house visiting to be a form of entertainment.
I hear from some folks that they’re daunted or even terrified at the prospect of buying a home. If you’re having those feelings, my recommendation is to check yourself into “home buying exposure therapy” and start going to open houses. The more you visit, the more confident you’ll become in your ability to assess houses for what they are: assets.
In some ways, seeing so many houses gave Mr. FW and me a cold, clinical eye. Have you heard of people who wouldn’t buy a house because the interior was painted the wrong color? Yep. It’s sad, but true. If evaluating a prospective home is a completely alien endeavor, it’s likely you’ll be swayed by the wrong things (such as easily changed paint colors) and will ignore the big things (like 100-year-old uninsulated windows). Going to a bunch of open houses is like dating before you get married. You become familiar with the terrain, you learn what you’re looking for, and you know a first-rate catch when you see one.
The Proof Is In The House
So did our Open House Visiting Bonanza of several years actually pan out for us? I’d say yes. We saw our current home and within 15 minutes were certain we wanted to put in an offer. Good thing too since houses in Cambridge are known to sell mere days after going on the market. We were completely confident and aligned in our decision to buy this house and we actually spent very little time debating. This house was the one.
We’d been on enough first dates to know that our current home had some special sauce going on–it was priced very fairly, it’s a single family (rare as a greyhound with wings here in Cambridge), and it’s big (by Cambridge standards).
But the real reason we were able to net such an amazing deal is that our house showed terribly. It was pretty much a 101 on how not to stage a home for sale. There were heavy lace curtains blocking out all the natural light, it was crammed with bulky furniture, houseplants dangled in every corner, and ancient floral rugs covered the gorgeous wood floors. To top it off, there were photos hanging on every square inch of wall space. In other words, it was not visually appealing in the least. But, thanks to our aptitude in looking past the superficial flaws of countless properties, we were able to hone in on the key features that made our home a fabulous find.
Mr. FW and I were aware that these factors not only equalled a superb place for us to live, they also equalled a marvelous place for us to rent out in the future. Without our years of experience in open housing (oh yes, it’s a verb now), I don’t think we would’ve been able to make such an accelerated decision and, if we’d delayed, it’s very likely the house would’ve been snapped up by someone else. In fact, our realtor later told us that if we hadn’t bought it, he would’ve!
In addition to the benefit of a speedy decision, we’ve never second guessed our purchase. We’d gathered so much data on area real estate over the years that we knew an opportune deal when we saw one. It’s a very comforting thing not to question the largest purchase you’ve ever made!
Visiting open houses not only refined our personal tastes, it refined our pricing savvy. Being the frugal weirdos that we are, we wanted to extract the best possible value for our money in buying a place. And what better way to do that than by having years of price comparisons in your head? Since we knew what the highest and lowest ends of the market in Cambridge had to offer, and since we’d seen just about every comp (that’s a comparable home) out there, we were incredibly confident in the offer price we put in. And, we were familiar with the attributes of the location. In 2015, our area was ranked by Redfin as the #1 hottest Cambridge neighborhood.
While a realtor can certainly be helpful in constructing an offer and shepherding the technical process of purchasing a home, their incentives often don’t align with a buyer’s when it comes to advice on pricing. Thus, we believe it behooves the savvy frugal buyer to have your own sense of what a fair price is, what the comps in the neighborhood are, and what a great deal looks like.
Now that I’ve hopefully
browbeaten convinced you of the inherent value of open housing, here are my top tips on open house etiquette!
The Frugalwoods Top 12 Open House Tips (and some FAQs thrown in for good measure)
1) What is an open house?
An open house is an opportunity to walk through a house that’s for sale without the need to bring along a realtor. If you want to schedule an appointment to view a house on your own schedule, you’ll need to work with a realtor. But for open houses, you can go solo. The listing agent, also known as the seller’s realtor, will be the person hosting the open house, not the home owners (unless the house is for sale by owner).
2) How do I find open houses?
Open houses are listed online in a number of different venues, which vary by region. Here in Cambridge we use Redfin, which we highly recommend if it’s available in your area. If Redfin isn’t in your city, Realtor.com is another source for open houses. You can also pop into an open house you happen to see a sign for on the street.
3) Don’t be embarrassed.
I’ll admit that Mr. Frugalwoods and I go through life truly not caring what others think and honestly, we’re much happier and less stressed because of it. But in this specific scenario, it simply doesn’t matter what some random realtor thinks of you.
I often hear from friends that they’re reticent to enter an open house because they’re afraid they’ll be judged as not wealthy enough, not a serious enough buyer, or not savvy enough about house buying–to which I say, so what if you’re not?! The only way you’re going to learn is by dipping a toe in and not worrying.
4) Remember, it’s the realtor’s job to show the house.
The very goal of an open house is to generate foot traffic for the property. Most of the people at open houses won’t ever put in an offer on the property. The listing agent knows this and they’ll focus their time on prospective buyers who show up with a realtor in tow–they know those are the actual serious buyers.
If the listing agent and sellers didn’t want people tromping through the house, they wouldn’t hold an open house. Open houses are not a requirement for sellers, they’re an option. You’re actually doing the listing agent a favor by showing up. After all, they want to prove to the sellers that they had lots of people checking out their abode.
5) Comply with the sign-in sheet.
The listing agent will likely ask you to write your name on their sign-in sheet, which is their way of showing the sellers that people came to the open house. Again, the raison d’être of an open house is to get maximum eyeballs on the property. We always sign in because it’s the polite thing to do. Our trick? Omit your phone number and email address.
6) Feel free to ask questions of the listing agent.
We frequently have a few questions and the listing agent is usually happy to answer them. Sometimes we’ll chat with an agent for quite awhile. Other times, we don’t even see them because they’re busy with other prospective buyers. Don’t be afraid to show your naivete in asking questions. After all, this is an expert who can offer you some insight into real estate in your area, so take advantage of the free advice!
A few of our favorite questions:
- If we’re looking at a condo, we like to ask about the HOA (home owners association) fee, what the association’s reserves are, and any upcoming assessments.
- If the unit or home is currently rented, we always ask what price it’s rented for.
- I like asking how old the roof is. Because, why not?
7) OMG, the listing agent asked me a question!!!
Don’t panic :). If the listing agent asks how long you’ve been looking, you might say what Mr. FW and I say: “we’re always looking at real estate in the area.” This is entirely true. If we see a fine looking opportunity, we’ll buy it!
8) But seriously Mrs. Frugalwoods, am I allowed in an open house?
As long as you’re a human asking this question (and not a greyhound), the answer is yes. Anyone is allowed to attend an open house–there’s no rule or law that you need to be actively interested in buying that particular home.
9) Follow house rules.
Pursuant to #8, we never take Frugal Hound into an open house and we always follow whatever rules the listing agent requests. For example, many places ask that you remove your shoes before walking through the house, so, we remove our shoes. No biggie.
Pro tip: wear slip-on shoes and always make sure you’ve got socks on!
10) Take a listing sheet.
Those handy-dandy sheets containing photos of the house, specs, and the asking price are there for your perusal and enjoyment! Take one and read through it. Ask the listing agent any clarifying questions you have and feel free to take notes. Then…
11) Discuss the house later that day.
If you’re buying a house with someone else, sit down together and have a frank conversation about the houses you visited. Discuss likes, dislikes, prices, neighborhood preferences, and everything else you consider important in your future home. Treating each open house like a case study will build your house buying muscles and transform you into a house buying hulk. There’s no such thing as learning too much!
12) Have fun!
I cannot stress this enough. Researching houses and real estate doesn’t have to be an arduous, painful process. Enjoy waltzing around other people’s homes and relish all the knowledge you’re gaining! Nothing will prepare you to buy your own place like visiting a ton of available homes.
Mr. Frugalwoods and I still go to open houses. All the time. Why? Well, partly because it’s a hobby, partly because we love real estate, and partly because we’re not done buying. Even though our next property will likely be a homestead, which is an entirely different real estate beast, we just might buy a multi-family to rent out someday. We like to keep our options open and by holding our frugal fingers on the pulse of the Cambridge market, we still know a good deal when we see one.