Contingency Staging- I hope this is not the future of staging

I had heard that a certain realty company (Assist 2 Sell ) has now partnered with home stagers. So I thought that is great and I emailed my local Assist 2 Sell office here in Northern Indiana. It turns out, that since each office is independently owned each works differently.

I emailed the owner of the Assist 2 Sell office and he told me that they work with stagers but only on a contingency basis. That means I would not get paid until the house sold and I would only get paid if it sold. I would have to wait for who knows how long before the house sold in order to get paid. I don't think so. Is this the way staging is now going? I hope not, or I will be out of business.

Has anyone else encountered this contingency staging? I was told that the reason Assist 2 Sell does it this way is because they found out that their clients don't like to pay upfront. Oh Please! Big woo! I mean come on. They would rather risk losing money by not having the house sell than to pay for staging up front? That is crazy.

I would be interested in hearing if anyone has heard of this before and if you did do contingency staging. It doesn't make sense to me. I was begining to wonder what to blog about because my mind was blank for a few days but this just gets my goat.

I called the place from where I heard about Assist 2 Sell joining with stagers and told them about what happened. They said I was the first person they heard about that said anything about this. They said that they have heard favorable things from other stagers but I was the first that this happened to. They again stressed that each offfice was independently owned and they ran it how they wanted it run.

I have aired my greivance out and feel better now. As the lady on the phone from home staging resource said, "Just move on to another one." That is what I am going to do.

 
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51 Comments on Contingency Staging- I hope this is not the future of staging

Sheila:  Stopped by to feed the fish...

I think Karen Demsky wrote a good post on why Stagers don't work on contingency the way Realtors do.  Once the staging is completed, our job is done (well, except for the de-staging...) - before the actual sale.  The Realtor's job is done when all the "I"s and dotted, all the "T"s crossed - after the sale.  But there are probably Stagers out there working on contingency - be interesting to hear their feedback!  Julie

05/20/2008 12:36 PM by Julia Maher, Staging Fairfield County Connecticut CT (Nestings)


Julia,

Where is the article by Karnen Demsky? Is she on AR? Those fish are intoxicating, I sometimes forget they are not real and I feed them and stare at them like they are real. If you move your mouse over the clock it really keeps time.

05/20/2008 01:33 PM by Sheila Swanson (ASHSR chapter president) (StageStruck)


Don't do it unless you know the attorney and real estate paralegal. You can submit your bill to the office and  your fee will be listed on the final HUD-1. That is the only way I would agree to that.

Phyllis Pafumi

05/20/2008 02:18 PM by Phyllis Pafumi-ReStyled to Sell Staging Homes NJ (ReStyled to Sell Home Staging New Jersey)


Sheila, where's the fish?  Did you forget to change the water? ;-)  Funny you mentioned about Assist to Sell and stagers.  I had heard this just the other day and I was all over this like flies on.....well.

After finding that there are 9 offices in close proximity, 3 are no longer in bussiness, 2 were bought out by another one, 1 already has a stager "but not nearly at your caliber" (yeah - she knew who I was =) and I left voice mails at the last 3 with no return calls....  But NO Staging on contingency ~ I like Phyllis' knowledge of the back end of the deal!

05/20/2008 05:12 PM by Connie Tebyani, Platinum Home Staging Serving Los Angeles and Ventura Counties (Platinum Home Staging, Inc.)


I would not do this.... there are too many factors you don't have control over.  IF you decide to do it, then you should get paid more than your normal rate (and rated as a % of the sale, just like realtors).  This way, if you lose some, you are still winning....

05/20/2008 07:29 PM by Melissa Marro www.StagingAndRedesign.com www.RedesigningCharleston.com (First Impressions)


We have never contacted an Assist 2 Sell office in our area, but I have heard of this being done.

I agree with Melissa, there are so many factors that we have no control over that can impede the sale of a home. And I also agree with Phyllis, if you don't submit your paperwork properly you may never get paid.

05/20/2008 08:04 PM by Tanya Venable, Anderson, SC/Spartanburg/ Greenville, SC/ Home Staging (Fresh Eye Designs)


Connie,

The fish are there but for some reason they are loading really slow.  If you move your mouse over the clock it moves and really works. Thanks for all the feedback everyone on the contingency. There is only one Assist 2 Sell office in our area. I don't know how the other ones down state handle staging but up here it's contingency.

05/20/2008 08:29 PM by Sheila Swanson (ASHSR chapter president) (StageStruck)


I was contacted by a local real estate reduced fee company, and they wanted to incorporate a free consultation for their clients (they would pay for the consultation) into every listing package. Sounds good, right? The kicker is, they wanted to pay me half of my regular fee per consultation because they were "going to be ordering so many", and the wanted to pay me in "2 or 3 weeks" after the consultation.  They also provided me with a very comprehensive consultation someone else had done and wanted to make sure my consultation would be at least as comprehensive. It was 15 pages long. I was willing to do a couple at the reduced rate, just to see how it went, but I was not willing to wait 2 or 3 weeks to get paid. The owner of the company called me to say that I was being short-sighted and a bad business woman and they wouldn't pay me sooner because that was their business model. (That's the way to make friends = thrill them with compliments!) I explained that my business model dictated that I get paid upon delivery. Needless to say, I never heard from them again, and they are now out of business.

05/20/2008 08:37 PM by Michelle Minch Home Staging Pasadena & Los Angeles, CA (Moving Mountains Design Home Staging, Pasadena, CA)


Run do not walk to the exit. this is not the future of staging. This is just a gimmick that they are trying to get our industry to buy in to and it won't work. Kym

05/20/2008 08:43 PM by Kym Hough, Staging Consultant , Staged to Sell, SF Bay Area, CSP (Staged to Sell & StagersLIST.com)


Sounds like they were the bad business people. It 's no wonder they went out of business. Did they themselves wait to get paid? It would be interesting to find out. Thanks so much for your input. Why would anyone want to wait to get paid? It's too risky.

05/20/2008 08:43 PM by Sheila Swanson (ASHSR chapter president) (StageStruck)


Sounds like they were the bad business people. It 's no wonder they went out of business. Did they themselves wait to get paid? It would be interesting to find out. Thanks so much for your input. Why would anyone want to wait to get paid? It's too risky.

05/20/2008 08:44 PM by Sheila Swanson (ASHSR chapter president) (StageStruck)


Never accept a payment timeline like that!  It is ridiculus for people to suggest it and those are the ones who do not really "get it" about Staging.  Their clients don't want to pay upfront?  Well 99.99% of my appointments are paid for by the listing agent as part of their marketing budget.

05/20/2008 09:35 PM by Tori Lynn Ross - Omaha's Premier Home Stager (Ross Designs, LLC)


I completely agree with what the others have already said here. This is not a good deal for stagers. What happens if the house never sells or the sellers relist it with a different REA? You would not see a dime.

05/20/2008 09:50 PM by Kathy Alexander, GreatStages, Vancouver WA (GreatStages)


Sheila, Great advise from Phyllis if you want to try that however, my question is do they pay the plumber, electrician and tile guy after the sale too?  Our role is so different than the REA, don't let anyone sell you short or tell you otherwise.  When you get down to it, we are a home improvement professional just like those I mentioned.  Lowes, Home Depot and the like charge for estimates and expect payment on completion of labor.  End of story.

05/20/2008 10:07 PM by Ana Hitzel AccentPositives Staging Corona CA (AccentPositives "Putting Your Best Space Forward")


I've been thinking quite a lot about what my policy would be if this did happen to become a commonplace occurance within the world of staging.

I don't think it's that bad, really. But if I am going to front my services, the services and of my mom and sister (family biz), and our carpenter, Paul, lay out the bucks to  by materials, furnish and stage, and then wait, I am ok with that. I have 100% confidence that listings that are FULLY staged, and in accordance with ALL our suggestions, will sell with remarkable speed. But if a seller wants our fee to wait until they sell, they don't have confidence, and I am ok with that, too.

SO.

I think we would be willing to be paid on a contingency basis. But we would require full control of the staging budget, which would be no less than 3% of the total asking price, and maybe no more than 15% (just in case the exterior needs to be repainted and new flooring is involved...that would take it to the higher end quickly). And we'd require the staging remain exactly as we left it, interior and exterior lights coming on with a timer, thermostat on, music playing, EXACT!  And we would have the right to check up on it at our discretion. The seller would have to commit to at least one heavily promoted open house per month. Plus, our final fee would go up by an additional $2000. No refund whatsoever if we get a hole-in-one (first person who walks in after staging buys it, which we have done).

So. Dunno if it's legal, but I don't see why not. I'd have to talk to my lawyer, and get it locked-down tight.

After all, I am investing our money into their house, I ought to see a bigger piece of the pie than our regular fees would give us.

As I said, I have been thinking about it.

~michelle

 

 

 

05/20/2008 10:14 PM by Michelle Molinari FEATURE THIS... (FEATURE THIS...)


Selling is about price and presentation. Even if you control the presentation, you as a stager have little (none) control over the selling price, and consequently stagers would be foolish to offer a contingency based staging approach.

A best response is suggest that the seller/real estate broker put the cost of staging on a credit card and pay themselves back at closing. .. that way , everyone has the same motivation.

Suggesting otherwise is akin to paying the doctor only if he cures you completly.

A faster sale.

05/21/2008 10:45 AM by will not work for free


Go ask an appraiser for a contingent appraisal.... LOL

What a farce.

People not willing to pay for your services upfront are not your clients. Move on.

 

05/21/2008 12:50 PM by


I'll pay you Tuesday for a burger today - but only if I'm not hungry afterwards.

 

 

05/21/2008 01:12 PM by burger


I have been asked to stage on contingency and declined.  I don't think many of us do it!

Kim Dillon, Creative Eye Home Staging

05/21/2008 01:31 PM by Kim Dillon (Creative Eye Home Staging)


Julia,

Thanks for recommending the blog by Karen. I loved it! I made copies in case I need to hand those out to whomever.

Thanks everyone for your input!

05/21/2008 01:45 PM by Sheila Swanson (ASHSR chapter president) (StageStruck)


Sheila, in my area, Waco Texas, survey companies do it a lot. And there is one fundation repair company that will do it. And of course, all Realtors do it.

05/21/2008 03:22 PM by Ann Cordes


Sheila:  Staging on Commission?  I don't think that idea has legs.  Too much labor and materials involved plus if the sale price is reduced than there is the typical argument that the staging wasn't worth the price paid.  I think staging should be paid  upon completion of the project.  While I realize Realtors, Loan Officers and others work on a commission I put staging on the same  level as an Interior Designer, paid when the job is finished.  Hopefully this is not the wave of the future for staging, too many problems.

Patti - Capital Line Funding Group, CA.

 

05/21/2008 04:01 PM by Patti Geib (Capital Line Funding Group)


If I were a Stager, I would do it with some kind of a deposit up front.  It seems to me that it could really boost business and there is always risk associated with growing your business and ultimately success.  Sure you might not get paid for one or two out of ten, but that would be ten more opportunitites that you might not have had.  I know as a REALTOR, it would be a lot easier for me to sell your Staging services to my clients if they didn't have to add to their already stressful time by shelling out more dough up front.  Have a contract written up, take a deposit to cover your time and costs and try it!

05/21/2008 04:08 PM by Courtney Cooper, Owner/Broker, Realtor- Seattle Real Estate (Cooper Jacobs Real Estate Services )


Sure and the check is in the mail too.  I would stay away from that offce. Have a great day 

05/21/2008 04:52 PM by Russ Ravary - Michigan Homes for sale - Michigan Real estate & Mortgage info (Remerica Hometown One)


If I were a stager, I would absolutely work on contingency.  The fee would probably tripple.

Also, I would only accept contingency jobs from sellers with agents who have a very high success rate for closing.  Also, I would only perform with a contract instructs the title company to pay the fee from the seller's net.  Also, I'd want to make sure the seller has net proceeds.  I would want to make sure that the property is priced at market or less and not some of the overpriced listings on the market.   

I might require a non-refundable deposit of perhaps 10%, in case of default of the seller of the real estate contract.  The staging contract is contingent on the settlement and default of the seller is always a possibility. 

However the details were worked out, I would absolutely want to work on contintency. 

05/21/2008 05:09 PM by Lenn Harley, Homefinders.com, MD & VA Real Estate


Someone in New Orleans is doing this & has been doing it.  I lost a job because I wouldn't work that way.  A local realtor has been using them a good bit & thinks that's the norm.  Little does she know.  Also, Showhomes has an odd pricing structure that is similar to a contingency.  At least that' the way I understand it.  Here's what they have on their franchise site:   "Homeowners pay an initial set-up fee and a success fee, offset by lower carrying costs, a premium selling price and an accelerated sale. The service is free to real estate agents."  The Success Fee referenced has to do with how much it sells for in the end.

 

05/21/2008 05:43 PM by Jo Ann Coulter-Wientjes (Sudden Change Interiors, LLC)


Yes, I thought about the price thing after I posted. Definitely, it would have to be priced in accordance with the appraisal and the Realtor's decision.

But a sound contract would protect me, as they do zillions of others in similar types of industry.

To think this contingency staging concept is not going to become the future of staging is really being naive. It may not be par-for-the-course now, but there is no way it won't evolve into that. Our biggest hurdle is that sellers are often times selling because of financial issues, and even when it's not the main reason, moving and buying a new home are burdensome. Staging is still in it's infancy, and when it grows up, it will include this scenario of a contengency.

The real issue here isn't whether or not you like the idea, or whether or not you are willing to do it. It is actually, how are stagers going to rally together to make sure contengency staging has an industry-wide standard. Who sets the standard? WE DO. Hiding behind anonymous quotes isn't going to stop this from happening.

Maybe we should be talking about HOW to do it as an industry, productively. Bouncing ideas off one another, considering worst case scenarios, covering our butts, and the like are going to save us a lot of tears and mistakes.

The stagers battle cry is often to encourage Realtors to recommend staging for every listing. So, make it more financially feasible! Our staging budgets will go up, our fees, and the cooperation of our clientele, will all benefit. The risk is minimized of we all discuss the risks, and brainstorm our policies for when this happens, because it will.

There's no stopping progress. When some stagers agree to do it, the stagers who don't, won't get the business . I am in this business with a solid sense that Staging hasn't seen even one one-hundredth of it's potential. To stay in the game, you need to be ahead of the curve.

You better get ready to roll with it, or swerve outta the way of the people who are.

I do not presently offer contingency staging. I have not been directly asked to do accomodate that request. But I am going to be prepared, because as a thinking business woman, I see which way the wind is blowing.

NOT AFRAID TO SIGN MY NAME-

Michelle Molinari

www.featurethisdotdotdot.com

 

05/21/2008 05:44 PM by Michelle Molinari FEATURE THIS... (FEATURE THIS...)


I do not offer contigency staging and I haven't been asked to but... I think Michelle is right so in the interest of worst case scenarios--Last year I staged a home in April--it went into contract roughly a month later, the contract fell through due to an abandanded underground oil tank on the property that was discovered by the home inspector .  The problem was resolved and the house went into contract--three more times--each deal fell through--buyer finacing was the recurrent theme.  The owner finally thought they had a good contract and I de-staged the house.  Last week I learned it is still not sold.  So, if I worked on contigency when would I have gotten paid?  Would I still be waiting a year later through no fault of the staging or the pricing?

 

Just so more food for thought--or fuel for the fire ;)

 

Deb

05/21/2008 07:05 PM by Debra Brodhecker--House Dressing NJ (House Dressing)


Great discussion on this topic.

We run into this proposal from time to time, and have spent time investigating approaches.

There are many moving parts that need to work together to successfully get a property sale to close, and one can only be party to a contingency when one can exert influence over the various parts in play. Some of the most important being;

  • listing price - is it priced correctly?

Stagers have no control over the listing price.

  • seller motivation - Do they want to sell, or do they have to sell?

What is the sellers motivation to complete their end of the bargain, the pre-staging tasks?

  • Is the sale a short sale/possible foreclosure situation?

The listing may not start out like this, but who pays the stager if there is no money left over?

The real estate agent and the seller are in the driving seat, we are enabling them to get to there destination faster, their ability to drive is unknown, as is our chance of getting compensated.

It is a roll of the dice, and you may be best advised in taking your money to Vegas, the odds may be better given the probability.

As to it being the future of staging - I'm all for it, tell me how, given my concerns.

 Akanke.

05/21/2008 07:52 PM by OpenDoorStaging.com - South Floridas Premier Home Staging Co 866-6STAGE1 (Open Door Staging)


These people are being sharks so that they don't have to pay. I'd choose NOT to work with them. How long before you get burned?

05/21/2008 07:55 PM by Alan Robinson (PTE REAL ESTATE GROUP)


One more thought: If a stager did accept credit cards, and the home seller chose to pay by credit card, they could take as long as they wanted to pay off the credit card company as long as they made the minimum payment each month. It becomes the credit card company's problem to collect.

None of my vendors (furniture rental, moving company, carpet company, etc.) will wait until the home sells. I can't afford to bankroll the home seller for all these out of pocket expenses.

05/21/2008 09:14 PM by Michelle Minch Home Staging Pasadena & Los Angeles, CA (Moving Mountains Design Home Staging, Pasadena, CA)


Sheila - I actually just ran into this with an individual client - I told him he could try to work something out directly with the tile guy and painter (needed the whole house painted), but that I would need to get paid up front. The question I had was - suppose that the realtor I work with does not sell the home and the listing expires? At that point, who is looking out for me? Suppose they do not sell the house with Assist2Sell and list with another realtor? At that point, how do you claim what is owed to you as your partnership is no longer in place? There are places for contingencies - Staging is not one of them!

05/21/2008 09:35 PM by Rebecca Groskreutz (Setting The Stage - An Illinois Home Staging Company)


Yes! These are the things we need to be addressing Akanke!

Other stagers are already working on a contengency basis. We don't need to reinvent the wheel. A contract, when appropriately drafted by a lawyer, can address and provide legal coverage for ALL these scenarios.

I have had to sue people before for breech of contract in my former business. I have won. I have received my renumeration and my legal fees were paid, per my contract's stipulations. It has happened to me twice. The judge took one look at the contracts and made a swift ruling in my favor. I was paid on the spot in one instance, and within 3 days with the other.

I guess I just don't understand this FEAR. Doing business with a contract isn't so scary. Most people, by far, do not reneg when a contract is involved. The odd duck, occasionally, yes, but it is so infrequent, from my experience. I cannot let that fear dictate whether or not I evolve as a business when this concept becomes more prevalent.

Staging is going to go corporate, and it has  already in some key cities. This trend will continue. I have to foresee this, and adapt my marketing and policies as the demand and expectations of real estate staging become standardized. You want to promote staging as an INDUSTRY? As the NEW WAY TO SELL RESIDENTIAL REAL ESTATE? You want to encourage everyone to stage? You better be ready for when everyone stages, and everyone is a stager, and those stagers offer better payment terms than you want to offer.  

The other thing is that I am willling to put my money where my mouth is. Staging, when done correctly,  is a sound strategy that I am willing to back up with a contengency-based contract that addresses the very scenarios you speak of. I am not afraid my houses won't sell. That is THE LAST THOUGHT I have, because THAT IS NOT THE NORM. Not being Pollyanna, but if I didn't believe in it so much, I could never sell the concept as I can. I believe in my team, I believe in my training, I beleive in my gut instinct, and I believe in staging.  How can I not even consider getting paid more for waiting longer on my paycheck for work I do today? Call it a gamble, call it a risk, call it coo-coo for coco puffs. MY butt will not be hanging in the breeze, because I will be prepared.

Another little thing..."Feature This..."  takes checks and credit cards. The fact is, neither of these forms of payment are 100% guaranteed. Both have to pass thru the bank, and both types of transactions can be cancelled before it hits my checking account. That hardly means I should only take cash! I have to adjust my perception of instant renumeration for services rendered to accomodate these widely accepted forms of payment because they are A.) an expected convenience for my customers, and B). the acceptable way to do business professionally.

The point is, one day, the contengency-based stagers will pop up all over the place. I don't plan on being a frightened dinosaur of my trade in a few  more years. I want to be in business for a long time. The real estate industry has crossed this bridge a long time ago. We, too, will have to decide if it's worth it on the other side, maybe sooner than we think, or sooner than we want.

To not even consider any plan whatsoever is A HUGE RISK, much more so than discussing strategies for segue-ing into the contengency arena.

This vehement disdain for all things contengency-based is really counter-productive. WE NEED TO TALK ABOUT THIS IMPORTANT STAGING ISSUE!  

And Sheila, I just want to thank you for bringing this topic up. You have really helped me to crystallize all these thoughts I have been rolling around on the edge of my brain. I wasn't ready to ask, but I now know that, thanks to your blog, I have waited to devote more thought to this too long. I didn't know it was so close to home already. One of the respondants here is Jo Ann Coulter-Wientjes (Sudden Change Interiors, LLC). She is only 75 minutes from where I am located, and she's seeing contengency staging.

I better get my butt in gear.

~Michelle Molinari

www.featurethisdotdotdot.com

 

 

 

 

05/21/2008 10:04 PM by Michelle Molinari FEATURE THIS... (FEATURE THIS...)


That's how Realtors get paid. One of the few professions that do it that way. Definately not the path for everyone.

05/21/2008 10:12 PM by Tigard Oregon Real Estate >> Wayne B. Pruner, GRI (Oregon First)


Fortunately for me, I have enough work piling up that I don't even have to think about taking contingencies. This may not always be the case for me, but I believe that a client needs to be as confident in what I do as I am, and if they are not and want to mess around with a contingency, then I am not interested. Perhaps my view will change, but as a custom home builder as well, I view contingencies as services that are NOT executed UNTIL a sale goes through not IN CASE a sale goes through. A home buyer does not get to move into a new home because the seller accepted a contingency. They only get to move into the home when the contract is executed and all contingencies are met. Do I have the utmost confidence in my ability to sell someone's home with proper staging - A RESOUNDING YES!

However, with a contingency situation, I have no control whatsoever in when I get paid - The seller/realtor/buyer have the ultimate control in that and I do not get to voice my opinion, therefore, I do not want to be at the mercy of a stubborn home seller or unqualified home buyer.

Should the market change, I am sure we all will adjust - but until then, I prefer to get paid for my talent and labor up front and on time. Any client who doesn't feel that my services are worth paying up front for will surely be able to find someone who will work on a contingency basis. I have plenty of clients who KNOW the value in my work and TRUST me to do the work as stated, and will gladly fork it over ahead of time to get the job done.

Just my two cents - paid up front:).

Rebecca

05/21/2008 10:25 PM by Rebecca Groskreutz (Setting The Stage - An Illinois Home Staging Company)


No deal.  Realtors pay their photographers, printers, and other marketing agents up front.  Staging is a part of that up front cost.  Unless you have a secure business relationship with an agent  I would even consider this.

05/21/2008 10:27 PM by Kristina, KFM Staging & Design - A Minnesota Home Staging Company (KFM Staging & Design)


Here's a blog here on activerain with many interesting opinions from both Realtors and Stagers regarding the mertits of stsging, stsging perceptions and misconceptions, and Contingency Staging:

http://activerain.com/blogsview/455792/Does-Staging-a-home

Some excellent stuff there, on all three sides of the coin.

 

05/21/2008 10:46 PM by Michelle Molinari FEATURE THIS... (FEATURE THIS...)


In any real estate transaction there are several businesses that contribute  to a successful outcome. Many, perhaps, most of us dont get paid, until and unless the deal is done.  Why should stagers be treated any different? The stageing is designed  for the single purpose of getting the house sold for top dollar. Why not wait until the sale, like the rest of us. And if there is no sale....well, we failed, and we dont get paid for failure.

05/22/2008 12:05 AM by Ron Parise (LocateHomes.com)


Do you ONLY pay for your newspaper ads if the house you advertised sells? Do you only pay realtor.com IF the house sells? No! These are services that are trading dollars for goods - which they are delivering. Stagers are not hired to marekt and sell homes, they are hired as one of the tools you can choose to use to make your home saleable. Therefore, once they provide that service of cleaning it up and packaging it to sell, they should be paid. Once Realtors provide the service they are hired for, they are paid. I  think that you would lose alot of your marketing tools if you approached every vendor with a plan to pay them when the house sells. I doubt many inspectors/appraisers/advertisers would agree to those conditions, and it would be hard to sell houses without all of those tools. Some realtors feel that a stager is one of those valuable tools!

I'm not sure the controversy is that prevalent in my market - Those realtors who know my services have never belittled my services by asking to pay me later, and for that, I am grateful!

 

05/22/2008 12:29 AM by


This sounds like a bad idea... same as it would be a bad idea for a gardener to wait to be paid or a painter or any of the other contractors or services.

05/22/2008 01:31 AM by Bob & Carolin Benjamin - E Phoenix Arizona Real Estate (The Benjamin Team - Keller Williams Integrity First Realty )


While we may not like the idea of contingency staging, I have to agree with Michelle that we can't afford to be an ostrich and keep our head in the sand.  I think we have to stay in tune with what other stagers are offering.  That doesn't mean we have to do the same as them, we are all free to run our businesses the way that we see fit.  However, I think it's a good idea to be aware of changes in the industry as they take place, investigate them and give a lot of thought to whether or not they are changes that are right for us, the business owner.  To just say flat out that I wouldn't change my business plan (in this scenario contingency staging) without giving it a lot of thought and investigation would be short-sighted.    

05/22/2008 08:34 AM by Charlene Storozuk - Burlington Ontario Home Stager (Dezigner Digz)


Sheila,

Great post and comments, I haven't been asked to do this yet in my area, but I'll keep this post to refer back to.  By the way congrats on this post - it is a feature post on AR main page. 

05/22/2008 08:37 AM by Donna Schoby, Ready, Set, Stage! Fayetteville, AR (Ready, Set, Stage! Serving Northwest Arkansas)


Hmmm, "contingency staging", maybe an idea whose time has come.

We don't get paid unless the house sells, why are stagers any different???

I like the contingency staging idea.

05/22/2008 09:24 AM by Jim Lee, Knoxville Tennessee Realtor® (Realty Executives Associates)


Stagers are not the same as realtors, the return is not equitable.

For instance,

Realtor

  • 3 homes for sale, $300k each, 3% commission contract for realtor.
  • If one sells, that's a $9k check for the realtor.

Stager

  • 3 homes staged, cost to stage ~$1k outlay on each - for total of $3k
  • one home sells, that's a $1k check

Hardly an apples to apples situation? 

(There is no rule of thumb in the expenses for the agent when selling, or the average cost of staging, but the exponiential difference demonstrates why it is not a good approach for a stager to entertain.)

 

05/22/2008 10:04 AM by the math


There are a few things about this that strike me... 

Assist 2 Sell generally gets paid up front... but they want the stager to wait until closing.  That's funny. 

Real estate agents generally have to wait until closing to get paid, yet we have to front a LOT of costs to vendors that won't wait.  While we do have some control, we can also be stuck with sellers that end up being uncooperative... why should stagers have a pass on that? 

Perhaps the best way to work the compromise would be for a stager to team up with an agent.  Offer a discounted or free consultation (if discounted, get paid for that up front), and then go contingency on the staging.  By working with a trusted agent, much of the risks can be mitigated... assuming the property sells. 

I like stagers.  I think that they perform a valuable service.  But, some of the comments I've seen here are almost humorous.  Remember, this is an environment where more than half of the members of this community don't get paid until the sale completes. 

Of course, the pricing would need to reflect the added risk.  I have worked with contractors that waited until homes sold before they were paid.  They charged a premium for the added risk and time waiting to be paid.  While I see some differences between staging and other services, I don't see this as something that is completely different and not to be considered.

05/22/2008 10:05 AM by Lane Bailey - The REALTOR for Car People (Diamond Dwellings Realty)


Sure - put me down for 3% of the selling price and you get my staging services.

We should extend other % points to the property photographer, the virtual tour provider, the local mls provider, appraiser, the painter, the landscaper, the moving company and so on.

For sure there are some instances where contingancy services may work, but in most cases, those stagers that take this route are one or two bad experiences from running out of cash flow.

For the record, free staging consultations are rarley acted upon by the seller. It cost them nothing to get the consultation, so they are not invested in the process.

As the phrase goes "it was free and worth it",

 

05/22/2008 10:13 AM by added risk


Interesting conversation, welcome to my world :) I can remember a stager coming to our office to talk about their service, we all thought the same thing, why doesn't she offer to do the staging and be paid upon the sale, makes sense to us, that's what we do. Most stagers of course don't like the idea of having to produce the end result of a sale to be paid, who can blame them, but isn't that exactly what the rest of us do? My thoughts in no way are about the worth of home stagers or the value of their services, I think some of you are just fantastically talented. The thoughts are all about payment options, not service value so please don't take it the wrong way. As the devil's advocate, why not payment on close? Someone mentioned your job being done when you complete the staging, but isn't the seller paying you to get the home sold, just another aspect of what they are paying us for. Otherwise we would love to get paid as soon as the home is on every internet site imaginable, scheduled for open houses, ad copy sent out, flyers printed, emails sent out to all the top agents, presentation to the office complete, a honest promise to keep up with all of these things throughout the listing period given to the seller and then payday, Oh well, they aren't buying that great plan, they actually want it sold first.

You pay the painter, we pay the printer, both of us work many hours, for us its open houses, showings, marketing, advertising, hand holding, negotiating deals that never come to a bottom-line, we are there through it all. With buyers we are filling our cars with gas (gold) and taking them wherever their little hearts desire, for as long as they desire, until one day they write that offer or call to say they decided our town just isn't where they want to be, or they lost their job. For you its moving furniture, changing color schemes and I know there is more to it, I just don't know all of the process and that doesn't mean I am trying to diminish what you do, I have clicked on some of your (meaning various stagers on AR) before and after shots and am amazed by the transformations, I have no doubt that you earn your money with increased marketabilty. I would love to have you come fix my home up.

The seller is hiring both of us to produce results, a sale. They aren't just wanting somewhere nicer to live while their home is on the market which would mean that the service was accomplished upon the staging, but they want more, they want a buyer, thats what they are willing to pay for. In most fringe areas of our business all of the services wait for a closing to be paid, our Title companies provide pre-title and are there for whatever we need to be researched with no pay until close, Home Warranty companies provide coverage for the sellers. sometimes having to pay for new water heaters, appliances etc and if the home doesn't sell, they are out the money, our lenders work with the buyers, educate them, pre-approve them, sometimes go through an entire loan process only to have it fall apart at the end, no pay for them either. I can't think of many people that work within the business of facilitating the sale of real estate that get paid prior to the closing.

The inspector, but they have provided their end service at the time of inspection, the appraiser, same thing, they have completed their job upon providing a price, the rest of us, you included, are really all here for the same reason, to close a sale for the seller and until that happens, our job isn't successfully completed, and sad to say most of us aren't being paid in advance. Count yourselves lucky that so far you have avoided what seems to be them norm for payment in this industry. Who knows what the future holds. I do this by choice, not force so I really have no right to complain about all the hours I work with buyers and sellers that may never end in a paycheck, I love the ones that do and I work hard to make sure that if it can happen, it will. In my area at least, I think stagers that were willing to be paid upon completion of a sale would get a whole lot more business. They would be joining the rest of the real estate crowd in having faith that if what they did was done well, payment would be coming in the end. If a closing doesn't result, they can join us in saying, "Next"

05/22/2008 08:25 PM by Beth Anderson ~ Tecumseh / Lenawee County ~Realtor (Success, Realtors)


Beth - Great points! However, my main point is this: The seller is paying YOU the Realtor to get the home sold. They are paying stagers to make the home sellable - which we do, and which we provide and finish prior to selling the home, thus we get paid. Big difference. Your job by definition is to sell homes. My job by definition is to make homes look good enough to sell. Therein lies the biggest difference between stagers and Realtors, and why I choose to NOT be Realtor as I do not have the talent of enviable talent of being able to get out there and sell like you do.

05/22/2008 08:45 PM by Rebecca Groskreutz (Setting The Stage - An Illinois Home Staging Company)


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