When flipping a property managing costs becomes essential to ensuring a good return-on-investment. But as a savvy investor, it is important to understand which expenditures are justifiable and can help move a property or even command a higher price. While sometimes an afterthought in the fixing and flipping process, staging a home can be an effective way to market your property and entice buyers.
Walking into an empty home void of any decor can make it difficult for many potential buyers to muster enthusiasm for the property. Home staging is a technique whereby the seller uses furniture and decorations to construct a model of what the space could look like once someone lives there. Creating a dynamic environment makes a home more attractive by helping buyers visualize its potential, and it can also be a good tool for camouflaging any shortcomings.
But staging a home goes far beyond just aesthetics, there are real tangible business benefits.
With most people beginning their search for a new home online, how you market a property can have a big impact on whether a potential buyer ever steps foot in the home. According to one real estate study, 87 percent of those using the Internet during the search process found photos of a home to be very useful. That said, a well-staged house can help your photos stand out among the myriad of competition online.
Homes that are staged also stay on the market for a significantly shorter period of time. Another real estate study found that unstaged homes spent an average of 184 days on market whereas homes that were staged before going on the market sold on average in 23 days. This is an important point to consider, because for every month your property is on the market you are responsible for the carrying costs (i.e. mortgage, property taxes, insurance, utilities, maintenance and homeowners association fees). So, a lengthy sales cycle can really cut into any profit once you finally sell the property.
Staging a home can be as expensive or inexpensive of a venture as you want to make it. For investors who are regularly fixing and flipping homes, you may find it worthwhile to invest in some pieces of furniture that you can take along with you from project-to-project. For those who are not as confident in their sense of style, you may find that hiring a professional stager is the best option for you. While the cost to stage a home will vary depending on the location and your needs, to stage a completely vacant home the price can range from $975 to as much as $5500.
Whether choose to go it a lone, or hire a professional, here are a few tips to keep in mind as you prepare a home for the market.
Clean and declutter. Don’t underestimate the power of shining floors and clean counter tops. Buyers will be quick to write-off a property that doesn’t seem well-maintained. A good scrub of the place will help you present the home in the best light. Also, remove any clutter that may have accumulated during the fixing process. Cabinets and closets should be clear of unnecessary items, as not to detract from the overall space.
Home Lighting. Often times sellers do not use proper lighting when staging a home. As a result, the space can look gloomy, which is a big turnoff for most buyers. One simple way to create a warm environment is to increase the wattage of the bulbs used in light fixtures to 100 watts. This small change can make a dramatic difference on the overall ambiance. Another best practice is to make use of several types of lightning including ambient (overhead), task (pendant) and accent (table).
Furniture Groupings. A room does not need a lot of furniture to make it come to life. A few well-positioned pieces can go a long way in creating flow and making a space feel accessible. To create such an environment, pull furniture away from the walls and move it to the center of the room and create conversational groupings. This approach will open up the room and create the illusion of more space.
Finishing Touches. Accessorizing can make a house sparkle. The good news is that these stylistic touches do not need to come at a huge cost. Even seemingly insignificant things like adding fresh flowers to a table and candles to a bathroom can make a space feel homey and inviting, which can help potential buyers connect with the space on a deeper level.
Staging is about presenting a lifestyle to a prospective home owners. And the smallest of details can help them buy into the dream while also delivering you a great return on your investment.