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The Awesomeness of Holding an Open House to Find Tenants

by Paula Pant on March 5, 2014 · 13 comments

  

Let me tell you how much I despise one-on-one showings with perspective tenants.

Okay, “despise” is a strong word. It’s meant for dramatic effect.

But I’m a busy person. And driving to my property  to show a vacant unit to one person is a massive waste of time.  

Yes, I pre-qualify the tenants over the phone.  I’ll ask them a series of questions to make sure that they have the proper credit history, they can move in at the proper time, and they are generally serious about looking for a place to live.

Regardless of how much time I spend trying to prequalify a tenant over the phone, though, I still lose  far too much of my precious time conducting showings that will obviously go nowhere.  

Sometimes a potential tenant  will very clearly dislike the unit. Their disappointment with the house is evident — it’s written all over their face.

I’ll see them glance at some aspect of the home that I can’t control, such as the square footage of the kitchen, and I know immediately that the 15 minutes I spent driving to the unit, the 10 minutes I spent waiting for the potential tenant to show up, the 10 more that I will spend showing them the place, and the 15 minutes that I’ll spend driving back home are just a total write-off. Bye-bye, one hour of my life. 

Other times the potential tenant will no-show, which is even more frustrating.

But don’t worry — there are two awesome solutions.

The first and most obvious fix: Hire a property manager. That’s a different conversation for a different day.

But here’s a second, less-obvious fix: Hold an Open House.

The Awesomeness of the Open House

I took a page from the real estate sales playbook and started hosting open houses.  

When I list a vacant unit, I plan two Open Houses: the first on a weekday evening, and the second on a weekend.  

For example; I’ll state that I’m hosting an Open House on Wednesday from 6 p.m. to 8 p.m. and on Saturday from 11 a.m. to 1 p.m. (Note: Don’t plan the Open House too early in the morning. People like to sleep in, myself included.)  

When potential tenants call to ask me about a vacant unit, I’ll tell them that if they want to see the unit, they can come at one of those two times. I’m clear that I’m not doing any private showings.  

The vast majority of potential tenants are okay with this.  Every now and again, someone will protest: “Oh, I can’t make it during one of those times!,” at which point my reaction is — basically — “Tough. If you really want to rent this unit, you’ll find a way to make it happen.”

(Note: I once rented a unit to someone who couldn’t come to either of the Open Houses herself, so she sent a friend to tour the place on her behalf. When the friend raved about how much she loved the unit, the woman sent in an application — complete with application fee — sight unseen.)

The Open Houses are Fantastic for a few Reasons:

1. Time 

It saves me a ton of time. Rather than driving to a house 10 times to do 10 separate showings, I only have to drive there twice.

2. Competition

When multiple tenants view the house at the same time — and they see the other potential tenants touring the house — they get a very clear message: If you want to rent this, you’ll have to act quickly, because you’re facing competition.  

This motivates the tenants to put in an application sooner rather than later.

3. Preparation

The Open House format allows me to well-prepare the house for the showing.  Thirty minutes before the Open House, I’ll walk through the unit, turning on all of the lights, opening the blinds, spraying an all-natural air freshener, and otherwise preparing the place for the best possible showing.

I also bring a stack of flyers that list basic information about the unit, as well as the URL of the website where they can submit an application.

In short, I’ve completely copied the playbook that real estate agents use when they’re holding an Open House to try to sell a home.

The only difference is I’m holding this Open House to rent the home. (As a side note, I’ve heard some real estate agents say that they don’t have much success finding buyers via Open Houses. But perhaps finding renters is different — I’ve had tremendous success with this method, perhaps in part due to the “competition / act now” factor.)

4. Lead Generation

I meet many tenants who may not want to rent this specific unit, but who are in the market for other units.  If I happen to have another vacancy at the same time, I can direct that lead toward my other property.

Holding an open house is an effective and time-efficient way of conducting many multiple showings with perspective tenants. It has saved me countless hours and hundreds of dollars.
Photo Credit: nick.garrod

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{ 13 comments… read them below or add one }

Dave Tanner March 5, 2014 at 6:05 am

Paula, great article. I did an open house almost exactly like you describe with one big difference. I put the open house times and address in the ad…. oops. Lots of ppl showed, lots of unqualified ppl. I did snag a good renter, but had 20 others with no move in money etc. I’m now toying with the idea of doing a video walk through (or slideshow of photos) and putting the link in my ad or giving it to them if they pre-qualify on the phone, so they can see the tiny kitchen or whatever before coming over. Anyone doing a form of this now? We are all looking for ways to avoid the fruitless showings and the time it steals from us. Thanks

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lamac66 March 5, 2014 at 1:49 pm

I am considering doing the video walkthrough on a link. I will need lots of practice or hire someone because that has to be top-notch. Open houses is way more efficient. I feel the more you advertise with photos and videos the more prospects may pre-screen themselves on the house appearance alone.

I just can’t imagine doing private/individual showings.

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Sharon Tzib March 5, 2014 at 7:01 am

Realtors say that because they hate doing open houses, but when I was a realtor, over 25% of my sales came from opens – either selling the listing in question – or – meeting buyers who then ended up purchasing a home through me. So yeah, I can see how this could definitely work for a rental. Good for you finding a way to be more productive.

“It’s not enough to be busy, so are the ants. The question is, what are we busy about?“ – Henry David Thoreau

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Shawn Holsaple March 5, 2014 at 7:10 am

I tell all pre-qualified candidates that I can meet them at set time [usually Thursday @ 5:45 p.m. for a weekday or 2:15 p.m. on Sunday]. This way I have the competition element but only spend about an hour instead of several hours. I don’t mention an “open house” because they may not show up since they know I will be there anyway. With this technique, they assume the appointment is for only them and will more than likely show up. I also usually call about an hour before the meeting to confirm – this also helps the show up rate.

It’s always important to set ANY appointment using the “East & West” time strategy. Always set a time on the :15 or :45 of the hour, you will get a much higher show up rate. Never set an appointment on the hour or half hour. This is why doctors appoints and flights are never on the hour/half hour.

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Dawn Anastasi March 5, 2014 at 7:13 am

I do open houses for rentals. I don’t give the address in the ad but I do list the times. People have to call me to get the address. Also I do print up a little flyer and greet people at the door when they walk in and hand them a flyer. I introduce myself and get their names so I can get a notion of which people who said they would be there when they called actually showed up. I put out the applications typically on the kitchen counter and provide pens. People fill out the applications onsite. 99% of the time when someone takes an application with them, I never hear from them again; they’re just doing it to be polite.

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Arthur March 5, 2014 at 7:26 am

This is good info.

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Alex Craig March 5, 2014 at 8:48 am

We use leasing agents who charge $250 to rent properties……well worth the money. We also take a ton of pictures and several of the properties have walk through videos. As I type this, putting a QR code on the listing flyer at the house that takes you directly to the video would be a good idea.

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Frank Iglesias March 5, 2014 at 8:58 am

That’s a very good idea. It really save heaps of time.

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Adrian Tilley March 5, 2014 at 11:29 am

Great articles, I think one of the podcasts mentioned doing this for contractors also, for the same reasons.

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Lisa March 5, 2014 at 6:14 pm

I’m a realtor and have done this a couple times, it really is a more efficient way to handle rentals!

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Tim March 6, 2014 at 8:04 am

First, let me say I have never tried an open house but I can see a big benefit in doing that over 1 on 1 showings. I can even see a couple benefits to an open house over what I do, but the cost in time is just too much for me. What do I do to rent my units (all SFH) you might ask.

I let the prospective tenants show the unit themselves whenever they want.

I pre-screen over the phone to make sure they are not criminals, are ready to move, qualify income wise and so on. Then I give them the code to the lockbox on the front door. Yes, I keep a lockbox on the front door so anyone can get in when they need to, (maint., me, applicants, contractors, etc.). I leave applications on the counter (and some in this drawer, that cupboard, this shelf). I tell them to go during daylight hours because the neighbors are keeping an eye on the place for me and may call the police if they see activity there during the night. The benefits I get from this are as follows:

1. I do not waste my time showing units.
2. I check on the unit a couple times per week and replenish applications
3. I never have a no show
4. If someone had something come up and could not keep the appointment they can look at it later when they have time.
5. They can have family and friends look at it later
6. I get to go to their current home to pick up the application
7. While at their current home I get to see how they live
8. I can not be assaulted during a showing (happened to a friend of mine)
9. I reduce the risk of false claims (sexual assault, discrimination, etc)
10. Did I mention that I do not waste my time showing units!
11. I have rented a couple houses that the first time I met them was at lease signing, (maint man picked up application for me).

I have been doing this for about 12 years for almost 80 units and the only issues I have had are people forget to put the key back and the next person can not get in (1-2 times per year), people taking ALL the applications so the next person can not (that is why I hide others around the house), people leaving lights on, and once in a rare while they use the toilet and do not flush (water is on). In all those years I have lost 1 room of carpet and ZERO appliances. My units range from Section 8, Hood, middle class, working class and upper middle class. Try it and you may never show another unit again.

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Neil Rainford March 6, 2014 at 11:42 am

Appreciate the post, especially the ideas for making the unit attractive. I use the open house concept as well, but I require as a term of the lease, that current tenants show the property at reasonable times and with reasonable frequency upon notice of intent to vacate. There are a couple of advantages. First, I almost never have to show a property, second the tenants were shown the property by the previous tenant so they generally are comfortable with the process and they generally take pride in their homes so they don’t show them dirty or messy, third, the prospective tenants can ask the current tenant the age old question with impunity, “how is the landlord?” giving them an extra level of comfort with the property. I encourage the tenants to use open house concepts and I generally follow up with top rate prospective tenants who I often forward to the tenant after a pre screen, to find out if the property was in good shape when they saw it. It has worked really well for a few years. If I have a poorer relationship with the tenant, sometimes I’ll hire the neighbor to show it.

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Shaun March 9, 2014 at 3:48 pm

Good article and good comments.
The main theme is that it is not a good use of time to bend over backwards to show a prospective tenant a unit and then do the same for the next one etc.

I do the batch showing type stuff a few people mentioned.
In a given week I will post my ads and basically will setup batches of showings in a small window (generally 1 hour) maybe on 2 days. The first person that gets in touch and can do a time that works for me sets the first window and then the first person that can’t do that one will get to set the 2nd window. If someone can’t do 1 of those I say I will get back in touch with them for next week if the place is still available.
I do on occasion push the window out like 30min or so if someone says that is the only time they can make it. I’d say these people are about 75% more likely to be a no show then anyone else…

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