The question of whether or not to “stage” a home for sale comes up more and more frequently these days. It comes up across the country in every type of market, I’m sure. But, I believe it comes up quite a bit more in a down market.
The main reason staging a home for sale in a brisk growing market wouldn’t normally be necessary is because homes are selling fast enough to not warrant taking the time or spending the money to do so. Yet the time and money spent on staging a home for sale in a slow, constricting, or confused market may well be exactly what is needed.
Staging a home these days is very similar to the quality of the photos used in a listing back in days gone by. These days, if a home doesn’t have professionally taken high definition listing photos, the home doesn’t get nearly the respect and consideration it might deserve. “Staging” is growing to become the industry “norm” just like professional photos have.
Before we can get into the few main pros and cons to staging, we must identify what we mean by staging in today’s terminology. We also have to recognize that there are about as many highly successfully, high volume real estate agents against staging as there are in favor of staging. And all have some very convincing reasons.
There was a time not really that long ago where sellers were expected to know they would be spending time and money – in advance – to thoroughly clean, remove clutter and unnecessary furniture and belongings, do some repairs, and even complete some painting or upgrades before their home was put on the market. These days, and for some reason more so in a down market – maybe due to some increasingly tight financial considerations – these things seem to have somehow morphed into a negotiation between price, agent commissions, condition of the home, and whether it’s a seller’s market or a buyer’s market. These previously assumed seller responsibilities are now also lumped into the services offered by staging companies. And they’re not cheap.
Interestingly, a buyer’s home-hunting mindset is a major force to be reckoned with in the marketing of a home. And, it’s frequently contrary to a seller’s home-selling mindset. Buyers may be looking for “turnkey, move-in ready” while sellers may be looking for “good enough, we can always negotiate the price”. The agents involved, too, will have their own unspoken psychology in how they guide and advise their buyers and sellers.
Today, staging companies offer various levels of service at various levels of pricing. All of them bring their own particular artistic license or designer flair to their services. Some will charge for doing a walk-through analysis and making a verbal bid while others will do that for free in hopes of winning the business. Some will charge by square footage while others will charge by the volume of furniture, artwork, and knickknacks used. All seem to charge what seems to be a lot of money every month until the home is sold and their staging items are removed.
Which, brings me to question whether or not a Rent-To-Own company in your town might be a viable alternative to staging companies. But that detours us into the DIY territory which is always a possibility. But if doing it yourself was truly a viable option, then the seller would probably not need staging to make their home look the best and sell for the most. It might be an option for agents to offer, however.
It is my opinion that every home needs to be “staged” for sale. For the same reasons nobody goes on a date or to a job interview without first showering, shaving, dressing their best and doing some advance “recon” into what they’re potentially getting involved with.
But the degree of the staging will always be a moving target for each home. Some people will sell a nice enough car without first washing it, changing the oil, fully inflating the tires, or replacing a burned out light. And yet, others will spend a lot of money updating, upgrading, replacing, and refurbishing the car before they will sell it “with their name on it!” The cost/benefit sweet spot is what we’re looking for, yet is more elusive. The actual sales price of something is more intuitive and the difference will be more obvious. But the degree to which the actual sales price is different is not so easy to assign.
Having already stated that all homes should be “staged” for sale – meaning they should all be cleaned, DE-cluttered, show well, be organized and in good repair – we now look at the top considerations used in justifying a greater degree of staging.
Cost vs Benefit, great provable stats, and top-notch references will always be the main considerations in whether or not an actual staging company is hired. I say this because like-products and like-services are not all created equal. And what if you hire someone and their work doesn’t actually advance the sale of the home? This is the biggest risk because I’ve never heard of a refund policy for staging companies.
So, if a staging expert will charge $2,500 per month for a fully staged, clean, and vacant, 1365 square foot home with 3 bedrooms, 2 bathrooms, and a family room, and the asking price of the home is the same as the realistically expected sales price of $218,000 with 60 days on the market, then how is that $5,000 spent on staging justified? Even if the home sold for $220,000 in 42 days? Compare that to the seller spending $20,000 in upgrades and remodeling and selling the home for $235,000 in 3 days for cash and closing in a week. Again, it’s a moving target with lots of moving parts and not so cut and dried.
In my research, real estate oriented websites such as Zillow.com and Realtor.com claim that a staged home will be on the market 77 to 85% fewer days and generate up to a 20% higher sales price. This is obviously a very very generalized and averaged claim because, at the lower price ranges, it hardly seems believable at all. Plus, it is my assumption that those who will pay to stage their home to sell it are also more proactive and keeping current in the maintenance, curb appeal, and documentation of the work they’ve done on their home. These items speak volumes to a buyer and are far more compelling than just looking good with some awesome staging.
It is easier to justify staging vs not staging than it is to justify the higher degrees of staging – especially for larger homes. Consider a 4500 square foot, 20 year old home where staging could cost as much as 80 cents or a $1.00 per square foot per month with an average of 100 days on the market. That same $12,000 – $15,000 could be spent on new kitchen appliances and countertops. And the buyers would clearly see that they would get the benefit of those items. One just looks good while the other actually adds value.
Everything I’ve outlined here seeks to encourage sellers and their agents to focus mainly on those items that mean the most to potential buyers of the homes. And while I didn’t itemize and list the pros and cons to staging a home for sale, I have laid out several arguments in favor of staging while simultaneously arguing instead in favor of those items that increase the value in a home the most to a buyer.
My overall staging suggestions and recommendations revolve around three what I refer to as “first principles”. First, as comprehensively and as thoroughly as a seller can, keep or generate detailed records about everything the seller has done to the home. It is overwhelming how positively a buyer reacts to seeing the list of every repair, every replacement, every upgrade, every project the seller has done to the home – and when those items were done. It is equally valuable for buyers to see every operating manual for all of the appliances, systems, and amenities.
Secondly, get extra sets of eyeballs on the job to give you ideas and recommendations. We get so caught up with living our lives and lifestyles that we overlook how much smoking indoors or having pets in the house affect a potential buyer’s interest in our homes. We often need someone else to tell us that our homes smell like dirty laundry or our favorite deep-fried foods and that our home needs to be scoured and sanitized.
Thirdly, everything we do in preparing our homes for sale should be proactively tackled with the ideas of a) increasing the value in a buyer’s mind, and b) that “it is what it is” and we’re going to have to spend some time, money and effort to do things that we don’t think we should have to do.
And with these three “first principles”, every home should be immaculate, DE-cluttered, re-arranged, repaired, and priced right with emphasis on the strong points of the home that attracted the sellers to purchase the home in the first place.