Why You Should Stage in a Seller’s Market
With the real estate market being so crazy hot right now, many real estate agents may be less interested in staging their listings. This makes sense. The home staging industry was built on statistics like “staged homes sell 88% faster.”
This home staging statistic was compelling when the average home took a few months to sell. However, in a seller’s market, the expectation is that a listing will go under contract the first weekend, so even 88% faster is not that big of a deal.
How do you know if your market is a "seller's market?"
“A seller’s market is when there are more homebuyers looking to purchase a home than actual houses listed for sale. A seller’s market usually results in rising home prices, stiffer competition, and increased bidding wars among homebuyers.” -Redfin
Houses are spending far fewer days on the market, even without staging. But staging is not just about getting a home sold quickly.
Home staging creates an emotional connection for the buyer. Falling in love with the home is especially important in a seller’s market in order to make the highest possible profit on every listing. Let us explain...
1. Staged listings make buyers fall in love. And that is important!
The purpose of staging is to make buyers fall in love with the home. Every home is someone's dream home, and staging minimizes any perceived negatives and maximizes the perceived positives.
A 2021 National Association of Realtors™ study on home staging reported that 82% of buyers’ agents said staging a home made it easier for a buyer to visualize the property as a future home.
Increasing the perceived value of the home while creating an emotional connection for buyers will not only set your listing apart from the other homes on the market, but will yield higher offers.
2. Staged listings are more likely to make it through the inspection and appraisal process.
In a hot seller’s market, homes are going under contract quickly, but we are seeing more of those contracts fall through. Buyers felt pressure to jump on something, even if it meant they had to compromise some of their wishlist. When they are not totally in love and committed to the home, they are more likely to back out.
Maybe the house across the street comes on the market during the inspection period. The neighbors hired a professional home stager and their home looks like it could appear in an HGTV show. Sure, it is more expensive, but the buyers looooove this new listing.
Maybe the inspection report comes back with a previously unknown plumbing issue. Not a big deal if the buyer loves the home and has already pictured hosting Thanksgiving there and soaking in that tub. When there is an emotional connection to the home (that only staging can make), buyers are much less likely to back out of the deal or ask for concessions and repairs.
Contracts that fall through mean time lost and puts a stain on the home – people know that it was under contract and they wonder what happened. Was there some serious flaw that was uncovered?
Over a quarter of buyers are more willing to overlook property faults if a home is staged, according to the National Association of Realtors® 2021 Profile of Home Staging.
3. Staging helps buyers overlook needed repairs.
“With today’s housing market consisting of historically low-interest rates, quick home sales, and many homes selling for above listing price, buyers may have to spend their maximum budget leaving very little to no budget for home improvements or renovations.” -Redfin
Staging puts less weight on minor renovations that need to be made and helps the home feel as new as possible so there are fewer objections. Certified Staging Design Professionals know the most cost-effective updates to get you the highest return on investment for your home.
4. MLS photos of staged homes get more views.
Even in a hot market, buyers will still determine if they want to see a house from the photos. Almost all (99%) millennial homebuyers start their search online, according to NAR. Visual cues are persuasive for home buyers. The quality of your online images can directly determine a buying decision. Your first impression is your last impression, so make it count!
Once you’ve peaked buyers’ interest from your online presence, seeing the home staged in real life is sure to seal the deal.
5. Staging makes homes look bigger.
It may seem counterintuitive, but vacant homes actually feel smaller than homes that are fully furnished. Staging professionals will bring in furniture and accessories that are to scale with the room. This will give the buyers the impression that the space is actually larger than it is.
6. Home staging statistics show it is an amazing investment!
According to RESA, with an average investment of 1% of the sale price into staging, approx. 75% of sellers saw an ROI of 5-15% over asking price.
Let's say the listing is $1,000,000
1% staging investment = $10,000 staging investment
Sold for 5-15% over asking = $50,000-$150,000 over asking
Less the initial investment of $10,000
That's a 400%-1,400% return on the STAGING investment!
When determining the cost of not staging your listing, a recent IAHSP Survey showed that the average price reduction was 5 to 20 times more than what the staging investment would have been.
The bottom line…
Regardless of where the real estate market stands, staging is a crucial part of the selling process.
Homeownership is probably the largest investment people will make in their lifetime. By creating spaces that buyers fall in love with, the negotiating power stays on the seller's side throughout the buying process. Don't leave money on the closing table!
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