Open House

Cincinnati Area Board of RealtorsŪ

An Open House is a popular method of marketing a property which allows anyone to view a home for sale without an appointment.

As more and more buyers are choosing to have a REALTORŪ represent them through Buyer Agency, open houses can become a source of confusion among the REALTORSŪ who hold the homes open and those who represent the buyers. Since REALTORSŪ typically only get paid when they sell a home, it is important to them who sells it. If the listing broker procures the buyer, he or she will not have to split the commission with a cooperating broker. If, on the other hand, another agent is "procuring cause" in the sale of the home, the listing broker will compensate the cooperating broker.

Knowing who introduced the buyer to the property (and is therefore often entitled to the commission) can become confusing in an Open House situation.

For example, suppose you are working with a REALTORŪ to find a home, and you've looked at a few houses with them so far. Then the weekend comes, and you happen to drive by an Open House. You go in, tour the house, talk to the agent there, then go home. You decide you like the house and want to write an offer. So you call the REALTORŪ you have been working with to help you write up the offer.

Unless you told the agent at the open house you were already working with another REALTORŪ and he/she agreed to compensate him/her, your REALTORŪ may have a hard time getting paid for helping you buy the house. In some cases, the REALTORŪ ends up working for free. Regardless of how many other houses you have seen with your REALTORŪ, when it comes to determining procuring cause, only the actions related to the purchased property are considered.

How can you avoid this type of situation? First, your REALTORŪ can accompany you to the Open House, or he/she can make arrangements in advance for you to see the house with the agent holding it open.

Second, if you want to attend open houses unaccompanied by your REALTORŪ and he/she is unable to call ahead, you should ask the agent when you get to the house if the agent will agree to compensate your REALTORŪ if you choose to write an offer through him/her. If you forget to ask, you should indicate your REALTORŪ'S name on the guest register. However, this will not guarantee a commission for your REALTORŪ .

To help avoid confusion, though, you should discuss with your REALTORŪ the possibility of you going to open houses without him/ her as soon as you begin to look at homes.

Date: April 7, 1998