I hear all the time that sellers and Realtors believe that home staging just isn't worth the investment in properties that are "underwater". Short sales, or listings where the seller has to bring money to the closing table often discount the idea of home staging completely. Agents are afraid to tell the seller that 'more money' needs to be spent and sellers feel frustrated and angry at the thought.
Today I'm going to share two videos with you showing the point of view from the Stager (me) and from a home seller. I was not the stager or the agent for the seller in this case, Angela Batchelor from Wilmington, NC was. I think when you see the two points of view, it may make you think differently.
Next, I'm going to share some numbers to back it all up. What I love about math is that it is pretty black and white. Sure, statistics change and then the math adjusts accordingly, but all in all, our market and numbers haven't changed that much. While homes are selling much more quickly today than they may have been in 2010, what is true is that if they are not properly priced and presented, the days on market (DOM) is not much better. Buyers complain about inventory levels, but they are out there... they just aren't what the buyer is looking for today.
Now for the seller's opinion...
Now, let's look at some cold hard numbers.
- The National Association of Realtors (NAR) said that in 2010 the average home sales price in the US was $173,100.
- Zillow said that the average home took 1% in price reductions per month
- Trulia said that the average price reduction during the listing period was 9% for homes under $2M, homes over $2M it was 14%
- The Real Estate Staging Association (RESA) said that the average DOM reduction was 78% for staged VS non-staged homes.
Now for the alignment of each statistic across all platforms....
The above study shows that 126 homes were listed on the market for approximately 9 months prior to staging
78% of 9 months = 7.02 months saved….
(Zillow & Trulia stats merge here)
$173,100 x .0075 = $1300 average mortgage cost
$200 estimated Carrying Costs
Monthly costs ($1500) x additional DOM (7 months) = $10,500
Avg price reduction (1% x 7 mos) = $12,117
Total savings? $22,617
When all is said and done, the net savings in this example is likely to be around $20,000 (after we subtract the cost of staging). Home staging is not an expense. It is an investment. This is all about the NET PROCEEDS. How much less does a seller have to bring to the closing table? How many fewer months will they stress over the additional monthly mortgage costs? Will they be able to short sell instead of losing their home to foreclosure?
Eventually, with or without staging, the money will be spent. Will it be spent in additional mortgage costs, price reductions, money brought to the closing table, or will you rip the band-aid off, stage it and actually sell it now?
PS. I just created a new home staging infographic that showcases the statistics I just presented.
Thank you for reading... Underwater home staging? It's all about the net.