Can home title thieves can't steal your house?

Rick Kahler: Can home title thieves can't steal your house? No, they can't.

[Editor’s comments in brackets]

 Home title theft.

This is a “threat” I only learned about from frantic radio commercials warning that your home can be stolen from you. They claim thieves can deed your property to themselves and then mortgage or even sell it without your knowledge. In fact, they may have done so already! You may have lost all your home equity! You’ll discover the fraud when you are evicted by a foreclosure or new owner!

 Of course, after all these alarms, the ads offer a solution: buy their title theft insurance. They promise to shield your title, monitor it 24/7 and alert you when a fraudulent title transfer is filed. One company charges $79 a year for $1,000,000 of title theft insurance. It’s highly unlikely any such company will ever pay out a dime of insurance.  [One never knows, does one? With identity theft rising, need we say more?]

 The claims are so over the top that these companies either don’t understand the law or are intentionally

bending the facts. Like most things, these outlandish claims include a grain of truth. It is true that anyone can forge your name to any document, including a deed supposedly transferring title to the forger. Such a deed could be filed with the county register of deeds.

 That doesn’t mean someone has stolen your title.

 First, a forged deed is not valid and conveys nothing. Only you can legally transfer your title to a third party. If a buyer or a lender rely on a forged deed and don’t do their due diligence on a property’s title, they are out of luck. They, not the legitimate property owner, will ultimately lose any money paid to the thief. [This is why title insurance is important.]

 Second, a would-be forger could easily get a blank deed form online and fill in your property’s legal description obtained from public records. However, the signature must be certified by a notary public, who is required by law to verify your identity.

 Third, it is next to impossible for the thief to mortgage or sell the property to a knowledgeable lender or buyer. Lenders, title companies and real estate firms have so many safeguards in place that there is almost no chance a fraudulent transfer won’t be discovered. The required credit reports, employment and income verifications, back tax returns, appraisals and title insurance are bound to alert you and the lender that something is wrong.

 Even with a cash buyer, a thief’s chances of success are small. Only the most naïve buyer will fail to obtain title insurance. Title insurance protects buyers against defects in the title, including liens, fraud and forgery. It will alert the buyer or lender to any defects prior to closing. If a title company misses a defect, it must pay for any damages. No legitimate attorney or real estate firm will allow you to buy a property without this insurance.

 Fourth, if a buyer is naïve enough to buy property without a legitimate appraisal or title insurance, it is possible they could be conned. If they show up in your driveway with a moving van, however, they — not you — are the ones at risk of losing their money.

 Fifth, forgery is a felony in all 50 states, punishable by jail time and heavy fines. The court might also require restitution for damages caused by the forgery, such as the costs of clearing the title.

 In the extremely unlikely event that someone goes to the trouble and risk of committing all these crimes, the cost of clearing the title is the biggest risk to a homeowner. That will require the assistance of an attorney. Would that potential expense make it worthwhile to consider buying title theft insurance? Perhaps, assuming the policy covered such expenses. Unfortunately, none do.

 Rick Kahler is president and owner of Kahler Financial of Rapid City.

 [Most cases of stolen title are from decedent’s estates, especially in rundown neighborhoods.  Spying an empty house, maybe the owner is written up in an obituary, or the thief just finds out about it, it’s a prime subject for title theft. Agreed that a savvy buyer will most likely not get trapped, lenders are sometimes not so savvy.]

We are the New Jersey title insurance agent that does it all for you. For your next commercial real estate transaction, house purchase, mortgage refinance, reverse mortgage, or home equity loan, contact us, Vested Land Services LLC. We can help!

For your real estate purchase or mortgage refinance or

if you have questions about what you see here, contact

Dr. Title - Stephen M. Flatow, Esq.

Vested Land Services LLC

165 Passaic Avenue, Suite 101

Fairfield, NJ 07004

Tel 973-808-6130 - Fax 973-227-0645

E-mail sflatow@vested.com

Follow us on Twitter @vestedland

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Land banks to the rescue!

Land banks - a municipality's new tool in its fight against housing decay.

Land banking is a relatively new concept developed in the face of rising cases of "zombie" properties that blight our towns, boroughs, hamlets and cities.  If you have never heard of a land banking, here are some

Frequently Asked Questions on Land Banking

 1) What is a land bank?

Land banks are governmental entities or nonprofit corporations that are focused on the conversion of vacant, abandoned, and tax delinquent properties into productive use.

 Vacant, abandoned, and tax-delinquent properties are often grouped together as “problem properties” because they destabilize neighborhoods, create fire and safety hazards, drive down property values, and drain local tax dollars. In some sense, these are properties the private market has altogether rejected.

 Land banks, in essence, are a direct response to this growing trend of vacancy and abandonment, created to strategically acquire problem properties and convert these liabilities into assets. In short, land banks are intended to acquire title to these problem properties, eliminate the liabilities, and transfer the properties to new, responsible owners in a transparent manner that results in outcomes consistent with community-based plans.

 Most land banks have special powers (see below) that enable them to undertake these activities more effectively and efficiently than other public or nonprofit entities. When thoughtfully executed, land banking can resolve some of the toughest barriers to returning land to productive use, helping to unlock the value of problem properties and converting them into assets for community revitalization.

 2) How are land banks created?

Typically, land banks are created as public entities by a local ordinance, pursuant to authority provided in state-enabling legislation. Land banking programs can also be developed within existing entities, such as redevelopment authorities, housing departments, or planning departments.

3) How many land banks are operating throughout the country?

Based on our knowledge of and experience within the field of practice, we estimate there are approximately 250 land banks and land banking programs in operation throughout the country (as of July 2021). The states of Michigan, Ohio, Georgia, Pennsylvania, and New York currently have statewide land bank associations that represent their large numbers of active land banks. For a national inventory of land banks and land banking programs, check out our new Land Bank HQ Interactive Map. [See below for more information - ed.]

4) How does land banking work?

Land banks are designed to acquire and maintain problem properties and then transfer them back to responsible ownership and productive use in accordance with local land use goals and priorities, creating a more efficient and effective system to eliminate blight.

 In order to accomplish these tasks, land banks are granted special powers and legal authority pursuant to state-enabling statutes. Though these statutes differ widely from state to state, the more recent examples of comprehensive land bank legislation generally grant to land banks the following powers:

 We want to stress that a land bank is not a “silver bullet” for communities struggling with blight. Though land banks are uniquely designed to help reduce problem properties, the policies, priorities, and activities of a land bank must complement other community strategies and activities, such as strategic code enforcement, smart planning and community development, and effective tax collection and enforcement.

5) Aren’t land banks competing with the private market, with an unfair advantage?

Not so. In fact, a land bank is a direct response to a growing inventory of problem properties that the private market has altogether rejected. Most vacant and abandoned properties have serious legal and financial barriers that detract responsible, private investors. For instance, many abandoned properties have a clouded title, which introduces a level of uncertainty and liability few responsible investors, if any, are willing to assume. Also, many tax-foreclosed properties have accumulated years of back taxes that far exceed the market value of the property. Similarly, many properties left vacant and abandoned for too many years require an investment in repairs that greatly exceeds what the market could ever return. A land bank, therefore, is designed specifically to address the inventory of problem properties the private market has discarded, and to convert these neighborhood liabilities into assets that advance community-based goals.

6) When does it make sense to use land banking?

Any community considering the creation of a land bank should assess a number of factors to determine if a land bank is needed or likely to be successful. Some common triggers for creating a land bank include:

 Large inventories of vacant and abandoned property

Properties with little to no market value

Properties with delinquent taxes in excess of fair market value

Properties with title problems

Inflexible policies that dictate the disposition of public property, denying local governments the chance to be strategic and nimble

The speculation and uncertainty inherent in the auction sale of tax-foreclosed properties

Some jurisdictions may already have an entity or agency (e.g. a redevelopment authority) that is empowered with tools to effectively take control of large inventories of problem properties and return them to productive use, obviating the need for a land bank. In some cases, however, such entities are focused primarily on development, rather than on blight elimination and stabilization strategies in more distressed neighborhoods. Where this is the case, the community may still want to consider creating a land bank or land banking program.

7) What does a typical land bank program look like?

While all land banks exist to serve the same primary purpose of acquiring problem properties and returning them to productive use, they are quite diverse in their structure and operations. We estimate there are approximately 170 land banks and land banking programs in operation throughout the country (as of January 2018), and they vary greatly in terms of the types of cities, regions, and economic conditions in which they operate, the size of their inventories, their staff capacity, their legal authorities, and their goals and programs. Despite this diversity, our experience has shown that successful land banks exhibit some similar characteristics:

 Strategic links to the tax collection and foreclosure process. Tax delinquency is often the most significant common denominator among vacant and abandoned properties, which explains why nearly all land banks have established strategic links to the tax foreclosure process as a primary source of acquisitions. This is particularly in communities where (a) a primary cause of vacancy and abandonment is an ineffective tax foreclosure process and (b) where there are statutory powers, intergovernmental agreements or policies in place for a land bank to acquire properties through the tax foreclosure process at little to no cost. Though auctions can generate positive outcomes for marketable properties, the speculative auction rarely if ever leads to positive outcomes for problem properties. Land banks can and should play a key role in acquiring and converting tax-foreclosed properties to productive use.

 Operations scaled in response to local land use goals. Successful land banks have established acquisition and disposition strategies that directly support the implementation of local land use goals and meet community needs. Some land banks tackle massive inventories of extremely unsafe and abandoned properties as part of an urgent stabilization and public safety strategy, while others operate selectively with extreme deliberation. Regardless of the scale of operations, land banks should always make decisions based on a strong understanding of community priorities and goals, and guided by neighborhood, local and regional revitalization plans.

 Policy-driven, transparent, and publicly accountable transactions. The acquisition and disposition of properties – especially those that have long been harmful eyesores – is an important and sensitive endeavor. Successful land banks have gone to great lengths to build and maintain trust with the public through complete transparency in the establishment of priorities, policies, and procedures that govern all actions. Land banks should make sure these ground rules and policies are established prior to any transactions, and annually revisited with public input to maintain a high standard of transparency and accountability. Moreover, land banks should strive to create websites that offer members of the public full access to accurate, up-to-date information pertaining to all land bank operations, programs, policies, and activities, including sales listings and past transactions.

 Engagement with residents and other community stakeholders. There is no substitute for engaged community stakeholders who understand a community’s history and goals — and whose lives are most directly by a land bank’s work. Successful land banks have found creative and consistent ways to inform, engage, and empower these active residents to help prioritize land bank interventions and develop long-term solutions. Whether establishing a community advisory board or regularly hosting neighborhood meetings, land banks should explore and implement practices that affirm a strong commitment to inclusiveness, engagement, and empowerment.

 Alignment with other local or regional tools and community programs. Because a land bank is a tool to support locally developed land use goals, and not a goal in and of itself, it is important to coordinate with other blight prevention tools and programs. Successful land banks have helped facilitate and work within diverse collaborations across the public, private, and nonprofit sectors that share similar economic and community development goals. We can’t stress enough that, in order to truly be effective, land bank activities must complement existing blight prevention efforts, including effective tax enforcement, strategic code enforcement, neighborhood investments, and community-based planning.

 Recurring, reliable source of funding. A land bank’s focus is on the inventory of problem properties the local property market has basically rejected, and therefore will always require some level of public support—whether cash or in-kind—that is proportional to the scope and scale of vacancy the land bank is expected to help resolve. With a recurring and reliable source of funding, land banks can focus on the types of creative interventions and community partnerships that are required to transform liabilities to productive use that meet and advance community goals.

 A land bank is not a panacea for all problems associated with blight, or even a necessary entity in many cities, but in the right environment and with the right legal structure, a land bank can be a key tool for returning vacant and problem property to productive use.

 8) What are some of the core powers of a land bank?

Depending on state and local law, land banks often have unique legal powers to support their activities and facilitate the return of problem properties to productive use. Though these statutes differ widely from state to state, they generally grant the following powers:

Obtain property at low or no cost through the tax foreclosure

Hold land tax-free

Clear title and/or extinguish back taxes

Lease properties for temporary uses

Negotiate sales based not only on the highest bid but also on the outcome that most closely aligns with community needs, such as workforce housing, a grocery store, or green space

 Using these special powers, land banks can streamline blight removal and create a nimble, accountable, and community-driven approach to returning problem properties to productive use.

9) How is a land bank different from a redevelopment authority?

In a few states, legislation has been passed that grants redevelopment authorities many of the same powers as land banks. In Louisiana, for example, some redevelopment authorities can also function as land banks. However, in most states, redevelopment authorities and land banks differ both in terms of their legal powers and their mission. Land banks typically implement disposition policies that allow greater flexibility than a redevelopment authority in terms of transferees and consideration. However, unlike many redevelopment authorities, land banks do not have the power of eminent domain, nor do land banks have the power to tax. As for mission, many land banks are focused on acquiring, stabilizing and returning to productive use those properties that are considered to have the most blighting influence in a community. These are properties that may not have an immediate redevelopment opportunity, but are destabilizing neighborhoods and undermining quality of life. In comparison, a redevelopment authority is typically focused on properties with near-term redevelopment potential and on large scale development projects that align with highly visible and long-term economic development goals. 

10) How is a land bank funded?

Land banks are generally funded through a variety of sources, which may include revenue from the sale of properties, foundation grants, general fund appropriations from local and county governments, and federal and state grants. Land banks in certain states have received significant funding from the federal Hardest Hit Funds (for example, Michigan and Ohio) and the National Mortgage Settlement Funds (for example, New York and Illinois).

 A couple of financing mechanisms unique to land banks have been included in state-enabling legislation. For instance, in Michigan and New York, land banks are able to recapture 50% of the taxes on properties returned to the tax rolls for five years. In Ohio, special fees imposed on delinquent taxpayers provide a dedicated source of funding for land bank operations. Finding consistent and preferably dedicated funding sources is critical to the success of land banks, as they incur significant costs converting unsafe liabilities the private market has rejected into assets that improve neighborhood vitality. Several of the more successful land banks from around the country are also capitalized by their local units of government either through yearly budget allocations or in-kind assistance such as shared staffing.

11) How many properties do land banks generally have in their inventory at any given time?

Land bank inventories vary greatly from jurisdiction to jurisdiction. Inventory sizes range anywhere from a few properties to thousands of properties. Reasons for this variation include the size of the community in which the land bank is located, the level of distress and disinvestment in each community, the land bank’s property acquisition process, strategy, and authorities (including whether state law grants the land bank the authority to pick and choose which properties to acquire out of tax foreclosure), and the mission and goals of the land bank.

12) What kinds of properties do land banks acquire?

Most land bank acquisitions are vacant, residential, tax-delinquent properties. In addition to tax foreclosed parcels, land banks can acquire Real Estate Owned (REO) properties and receive private donations and public land transfers. Although most properties are typically vacant residential single-family homes or vacant lots, land banks also acquire multifamily dwellings, commercial and industrial properties, and in rare cases, occupied rental properties. In fact, some land banks even have well-developed brownfields programs through which they acquire large scale, formerly industrial properties.

 See more at https://www.communityprogress.net/land-banking-faq-pages-449.php#What%20is%20a%20land%20bank?

Keywords land bank foreclosures zombie

We are the New Jersey title insurance agent that does it all for you. For your next commercial real estate transaction, house purchase, mortgage refinance, reverse mortgage, or home equity loan, contact us, Vested Land Services LLC. We can help!

For your real estate purchase or mortgage refinance or

if you have questions about what you see here, contact

Stephen M. Flatow, Esq.

a/k/a Dr. Title

Vested Land Services LLC

165 Passaic Avenue, Suite 101

Fairfield, NJ 07004

Tel 973-808-6130 - Fax 973-227-0645

E-mail sflatow@vested.com

Follow us on Twitter @vestedland

Disclaimer:

The information included is designed for informational purposes only. It is not legal, tax, financial or any other sort of advice, nor is it a substitute for such advice. The information may not apply to your specific situation. We have tried to make sure the information is accurate, but it could be outdated or even inaccurate in parts. It is the reader’s responsibility to comply with any applicable local, state, or federal regulations. Vested Land Services LLC and their employees make no warranties about the information nor guarantee of results, and they assume no liability in connection with the information provided.

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Independent title insurance agents - the key to your real estate transaction

Vested Land Services LLC has long avoided joint ventures and other business arrangements with mortgage brokers, real estate agents and attorneys.  Unfortunately, in these cases, the end-user of the title insurance process - the homebuyer or homeowner - usually doesn't know she is being steered to a title agent that has a financial arrangement - a kickback - with the lender or real estate agent  or attorney.  Sometimes it's disclosed but in a fashion designed to avoid the customer's curiosity as to the nature of that arrangement.

Moral of the story - 

know your title insurance agent!

A recent settlement in a case involving a national lender and title insurance company was made public.  Here's the news release from Bloomberglaw.com

Title Insurance Kickback Case Ends in $1 Million Settlement Deal

Aug. 11, 2021, 3:07 PM

https://news.bloomberglaw.com/banking-law/title-insurance-kickback-case-ends-in-1-million-settlement-deal

 Suit one of several alleging schemes between lenders, insurers

Judge advanced case in January after initially dismissing it

Sierra Pacific Mortgage Co. will pay $990,000, plus up to $280,000 in legal fees, to resolve racketeering claims over an alleged scheme to refer mortgage borrowers to a title insurer that gouged them and kicked back some of its excess profits, according to a federal court filing in Baltimore.

 Each of the approximately 307 homeowners ripped off by the conspiracy would get about $3,200 out of the settlement, the lead plaintiffs say in a motion seeking preliminary approval for the deal from Judge George Levi Russell III.

 That recovery would provide a “substantial benefit,” given that “in most instances this award is many times more than the kickbacks paid” or “the increased costs resulting” from them, according to the settlement motion.

 “Like all complex commercial cases and class actions, this case was not without its associated risks,” the filing says. “While class counsel firmly believe this case is strong, no case is full-proof.”

 If approved, the agreement would end litigation in the U.S. District Court for the District of Maryland over kickback allegations involving Sierra Pacific and All-Star Title Inc., which isn’t named as a defendant.

 The proposed class action, filed in 2019, is one of several alleging violations of the Racketeer Influenced and Corrupt Organizations Act and the Real Estate Settlement Procedures Act by mortgage providers taking kickbacks from All-Star.

 Each of the lawsuits accuses a residential lender of referring customers to All-Star, which was allegedly able to charge an inflated rate for title settlement services thanks to the steady source of customers.

 Russell initially dismissed the claims against Sierra Pacific in March 2020, saying its “payments to All Star fall squarely within” RESPA’s “safe harbor” provisions because they were for services rendered.

 But he vacated that decision in January, admitting he’d fundamentally misunderstood the allegations, including the direction of the alleged kickbacks. It’s plausible those weren’t “bona fide” payments for “goods or facilities actually furnished or for services actually performed,” the judge said.

 Smith, Gildea & Schmidt LLC and Joseph, Greenwald & Laake PA are co-counsel for the homeowners. Sierra Pacific is represented by Weiner Brodsky Kider PC.

 The case is Walls v. Sierra Pac. Mortg. Co., D. Md., No. 19-cv-595, motion for preliminary settlement approval filed 8/10/21.

 

We are the New Jersey title insurance agent that does it all for you. For your next commercial real estate transaction, house purchase, mortgage refinance, reverse mortgage, or home equity loan, contact us, Vested Land Services LLC. We can help!

For your real estate purchase or mortgage refinance or

if you have questions about what you see here, contact

Stephen M. Flatow, Esq.

a/k/a Dr. Title

Vested Land Services LLC

165 Passaic Avenue, Suite 101

Fairfield, NJ 07004

Tel 973-808-6130 - Fax 973-227-0645

E-mail sflatow@vested.com

@vestedland

Disclaimer:

The information included is designed for informational purposes only. It is not legal, tax, financial or any other sort of advice, nor is it a substitute for such advice. The information may not apply to your specific situation. We have tried to make sure the information is accurate, but it could be outdated or even inaccurate in parts. It is the reader’s responsibility to comply with any applicable local, state, or federal regulations. Vested Land Services LLC and their employees make no warranties about the information nor guarantee of results, and they assume no liability in connection with the information provided.

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Homebuyers ask - What is a Certificate of Occupancy?

What is a Certificate of Occupancy?

Why do I need a Certificate of Occupancy?

When you’re buying a home, of course, you want to know that it’s safe. When you buy a property, you need to follow some requirements, one of which may be getting a certificate of occupancy. A certificate of occupancy is also called a CO. The general idea behind the CO is that it verifies a property is suitable to live in.

Beyond that, the following are more details to know about a certificate of occupancy.

 The Basics

 The certificate of occupancy is a document that shows a structure, like a house or office, is safe for inhabitation. A CO includes what the property is legally classified as in terms of zoning. For example, the CO will indicate whether the property is for residential, commercial, retail, industrial or mixed-use. That means that the property is being used as it’s meant to be. For example, residential property should be used as a primary residence.

 A CO verifies a property is up to code and in compliance.

 The third thing a CO does is show that a property is suitable for occupation based on the standards in the municipality where it’s located.

 A CO will include, along with verification that a property is up to code, the property address, a legal description including square footage, the zoning code, the owner, and any additional notes that might be relevant to the property’s safety.

 You can’t live in a property or use it until there’s a certificate of occupancy issued.

 When Do You Need a CO?

Local rules and specific situations determine if you need a certificate of occupancy to sell a house.

 If you have a converted space, you’ll need one. Basically, what this could mean is that if you were selling a multi-family home but converting it into a single-family home before doing so, the certificate needs to show the code change. If you’re converting a business into a residential space, again, you’ll need a CO showing the change.

 If you’ve made a lot of renovations, you’ll need a CO to sell it. [This is why it is important to "close our" building permits by having the work inspected by the municipality when the work is done.

 If you’ve done any type of remodeling, it’s best to verify whether you need a CO or not before you try to sell a home.

 If you didn’t have a CO before, but you need one to sell the home, then you might have to make changes to get it up to code.

 If you built a new house to sell, you’d need a CO as part of the sale.

When your home was built, there was probably a CO issued. As long as you haven’t made any major renovations or the building code hasn’t changed, then you should be able to use that one.

 How Do You Get One?

 If you do need a CO, then you can contact your local zoning or building department. There should be a website in the city or town where you live to indicate who to contact.

 If you have an existing home, you can apply for a CO at your local building department. Sometimes you might need to show architectural plans to apply if there were extensive renovations or the home was just built.

 Finally, if you do need a CO, someone has to come from the local government and inspect the home. It’s not the same as a home inspection that occurs when you’re doing a real estate transaction.

 During a CO inspection, the professional will come and compare the building to the current code and make sure there are no violations. They’ll look at general building components, plumbing, electrical, fire safety, and more minor elements.

 Then, at the end of the inspection, you get a report.

 If you passed the inspection you can claim your CO and go forward with the home's sale. If you don’t pass, then you’ll receive a list of what needs to be fixed within a particular window of time. Once you make the repairs, you’ll have another inspection before you can move forward.

 If you need a CO and you don’t get one, your transaction might not go through because a lender will not want to provide financing for a home that isn’t safe. You might also be fined by your municipality or sued.

 As a final note, in some municipalities, you need a new certificate of occupancy each time you sell a property or when a new tenant moves in if it’s a rental. If you aren’t sure about anything, check with your local building or zoning authority.

 

We are the New Jersey title insurance agent that does it all for you. For your next commercial real estate transaction, house purchase, mortgage refinance, reverse mortgage, or home equity loan, contact us, Vested Land Services LLC. We can help!

For your real estate purchase or mortgage refinance or

if you have questions about what you see here, contact

Stephen M. Flatow, Esq. a/k/a Dr. Title

Vested Land Services LLC

165 Passaic Avenue, Suite 101

Fairfield, NJ 07004

Tel 973-808-6130 - Fax 973-227-0645

E-mail sflatow@vested.com

@vestedland

Disclaimer:

The information included is designed for informational purposes only. It is not legal, tax, financial or any other sort of advice, nor is it a substitute for such advice. The information may not apply to your specific situation. We have tried to make sure the information is accurate, but it could be outdated or even inaccurate in parts. It is the reader’s responsibility to comply with any applicable local, state, or federal regulations. Vested Land Services LLC and their employees make no warranties about the information nor guarantee of results, and they assume no liability in connection with the information provided.

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Six truths about open houses

6 Truths About Open Houses You Must Know  

Do Open Houses Work?

It’s time to sell your house. Better get started with your plans to hold an open house to attract buyers.
Right?

 An open house will guarantee that your house gets the best exposure to the largest pool of interested buyers…

 Or will it?

 Actually, this isn’t always the case! Open houses are not the best in every case. This is why some sellers are beginning to shy away from holding them in today’s market.

 So why, then, will most real estate agents push for an open house?

 There are benefits for agents in holding an open house. Real estate agents build their own potential network of clients through open houses. But let’s be very clear about something: most of the benefit runs the way of the agent, and NOT, you, the seller.

 An open house is not a key component of a successful sale. The key components are the right real estate agent, the correct price point, and an excellent marketing campaign.

 Let’s face it: scheduling an open house can be a proper headache in your busy lifestyle, or ruin your relaxing family Sunday afternoon by preparing your home for sale!

 Here is my expose on open houses: six truths that may change your mind about open houses. You’ll agree you should think twice before running your next open house and inviting every Tom, Dick, and Harry!

 Truth #1 – You don’t need an open house for a successful sale

Most agents will try to set up an open house, simply from habit.

 This is the set way in which real estate sales have been running since before there was a World Wide Web.

 “But hasn’t it always been done this way?!”

 Well, advancing technology has revolutionized all areas of industry and commerce, and real estate is no exception. Top real estate agents have adjusted to the times and rightly asked whether there is even a need for open houses.

 Prospective buyers now hit the internet first when embarking on their home-buying journey. A great online listing should be part of your marketing strategy – far more than an open house!

 Interested buyers who are moving toward making an offer will get the agent’s details from the listing and set up a viewing as soon as possible, regardless whether there will be an open house next weekend!

 This framework actually weeds out those who aren’t interested in buying your home.

 Rather than focusing on sorting out an open house, connect with a competent real estate agent with an expansive network of buyers and sellers. Invest time and effort into developing a solid marketing campaign with them.

 Truth #2 – Most of those attending the open house aren’t qualified buyers

It is true that some who come along to your open house may be looking to buy. But in my experience, there are quite a few who show up who have no interest in making an offer.

 Some will be “just looking”. Some will be nosy neighbors looking to check your place out. I’ve had it many times where couples confide in me that they enjoy going to open houses on Sundays as a pastime or hobby! Beats staying home and watching Netflix, I guess?

 In short, the open house mentality encourages many to pitch up on the day itself, who aren’t prepared for what they’re about to see and highly likely will have no intention of buying.

 An agent worth their salt will instead prioritize private viewings with pre-approved buyers who are in the position to make an offer.

 Truth #3 – You can expect those inquisitive community members to pop in

The myth is that every open house leads to a long queue of genuine, interested, potential customers.

 Wouldn’t that be great?!

 The reality is that an open house is an opportunity for window shoppers to come off the street to have a look.

 Why do nosy neighbors make use of an open house? They may have always had an interest in seeing the setup at your house. It may be to compare their space to yours. Some enjoy seeing similar decor and furniture arrangements in their area to get creative ideas for their own space. Some want to compare market values. And some are only taking license to be nosy.

 If this doesn’t appeal to you, as the home seller, the solution is rather simple: don’t run another open house.

 Truth #4 – Open houses have a poor conversion rate

When you run an open house, you are inviting the world in to see your house. This can include a small percentage of potential buyers. However, in most cases, you are also inviting in a crop of people not interested in buying your home.

 This means that open houses are more often more trouble than they are worth! That is, for you, as the home seller, of course. Meanwhile, your agent is expanding his client network on your time in your open house…

 The true professional real estate agent will be better off spending their time and effort on attracting true potential buyers.

 Truth #5 – Open houses are not good for your peace of mind

Unfortunately, it would be naive to think that everyone who walks into a show house has the best intentions. We don’t have to spend time unpacking current crime statistics to drive the point.

 We have an opportunity here to expose the drawbacks of open houses:

 Incidents of theft do occur on open houses. Worse still, in certain cases, there have been burglaries following the open house. Criminals attend the open house, identifying weaknesses which they can exploit at a later stage. Some even sabotage locks on doors and windows during the open house.

 Is it worth the risk, when you consider what valuables and heirlooms you have on your property?

 Truth #6 – You don’t have to agree to run an open house

Even if your agent is pushing you into holding an open house, you can just say “no”.

 One reason some agents still endorse open houses is that it looks like they are doing good work when they take up their (and your) whole Sunday for an open house!

 Rather than judging an agent by how busy they look, base it on the results they get: how long does it usually take for them to sell a house? Do they usually sell houses close to the sellers’ asking prices? Do they have good references?

 Bottom line: a good agent will be open to a discussion about whether to hold an open house. While it might still be advantageous to hold them in certain rare situations (such as new construction), bearing in mind the pointers in this article, listen to what your agent has to say and make your own informed decision.

 Good luck!

Thanks ImmoAfrica for more timely information - the editor.

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