Can you afford not to Stage your home?

A Staged home will look better than competitive homes in
your local market, allowing you to sell your home faster
and for more money.

GETTING YOUR HOME SOLD IN A SLOW MARKET!
Be too good to pass up...

You know, any licensed Realtor can list a property for sale. That is obvious, there are multiple signs on many street corners these days. Why do some sell and others sit unsold. What are Realtors and Sellers doing that are getting their homes SOLD? There are "tools of the trade" for agents to discuss with their sellers to decide if they fit in the marketing plan for their home when it goes on the market.

This is a list of some of them:

PRICE TO SELL - Price your home at or under the competition. In a declining market you want to price your home to be attractive today. Don't play the game of seeing what happens... If the market is dropping 1% per month for example and you play that game, you'll have to drop next month 2% or you'll be behind the market. You'll be doing what we call "chasing the market down" instead of "pacing the market"... I have seen multiple offers on aggressively priced properties that then sell over their list price and that is because in the eyes of the buyer, it was too good to pass up, even in this market. Price right and be too good to pass up. The longer a home sits on the market the lower the offer price proportionate to list price. Buyers think you'll be more negotiable after 30 or 45 days than earlier on in the listing period.

STAGE TO SELL - If I were to tell you there are two things that if you do them will virtually guarantee your home will sell, would you do them? Well if you need to sell, you'd be wise to do both prior to putting your home on the market. One is price and the other is staging. Stage your home. Remember that to sell your car for top dollar you would shine the windows and tires, wash the car, clean the inside and have it smelling and looking good. Why not invest at least that in what may be your largest investment in a lifetime? Staging is not decorating!!! It is maximizing your home's potential to the largest audience of potential buyers. The more exposure and appeal to the widest audience, the more chance of a sale and at a higher price than an unstaged home. Staged homes are clean, look appropriate for their arrangement, (meaning a dining room is a dining room not an office) and are "showcased" much like a builder does for their models. Builders wouldn't invest in staging their models if there was no return. Stage with a professional stager and be too good to pass up.

CREDITS FOR CLOSING COSTS - Many new home subdivisions on the market now are offering up to 6 months with no payments, $50,000 incentives for upgrades and closing costs, premium lots at reduced rates, etc... Again, builders wouldn't invest in incentives if they didn't work. Compete with incentives.

Why do you see sold prices that sometimes are higher than list price? Often it is not a multiple offer situation like the pricing example above, it is because the buyers and sellers have negotiated a higher price so the buyers can finance some of their closing costs and/or improvements. For example. If a property is priced at $400,000 and the buyer offers $390,000 with a $10,000 credit for non-recurring closing costs, the seller may counter back at full price with the $10,000 credit ($410,000) or add $5,000 ($405,000) on the price and split the financing of the closing costs for the buyer. Or somewhere in between if the property is overpriced for the market to start with. Some sellers that are aggressively priced might be able to counter the offer with a little over asking price and give back the credit to the buyer. The buyer has $10,000 less to come up with and is in essence financing the closing costs. That is often easier than finding another $10,000 to purchase with. Many buyers who are short on cash are qualifying based on their credit and income with this method of limiting their closing costs.

In the last few years of the boom, this would not have been possible as sellers didn't have to offer incentives or negotiate. That was then, this is now. Deal with the market you are in... By the way, lenders will allow up to 6% credit for buyer's closing costs. If the non-recurring closing costs do not reach that amount you do not generally get the balance of the credit. Offer credit for buyer closing costs and be too good to pass up.

CREDIT FOR BUYER 2/1 BUYDOWN - Offer money for the buyers financing. As interest rates increase, there are fewer buyers who can qualify for your price range... To increase the number of buyers you either have to lower the price or offer incentives that reduce their payments or increase their ability to qualify. One way to do that is to offer money for the buyer to buy down the interest rate. Called a 2/1 buydown, the approximate 2.75-3 points additional loan fee (2.75 to 3% of the loan amount) will buy down the interest rate the 1st year by 2 percentage points and the 2nd year by 1 percentage point, the third year being at the note rate at the time of taking out the loan. Right now that would be 6.125% note rate but qualifying the buyer at the 4.125% first year rate and the second year rate of 5.125% kicks in for one year followed the third year by the note rate of 6.125% for the balance of the 30 years. The best part of this loan option is that the rate is a FIXED rate, that was just bought down and will not ever adjust above that fixed rate of 6.125% . Offer points for the buyer's 2/1 buydown and be too good to pass up.

BOATS, PLANES AND AUTOMOBILES (TRIPS) - Does anyone really buy a home because the seller offers a trip to Hawaii or a new car? Well if the house isn't in their price range and just isn't the right home for them, no. But again, selling your home is about MARKETING. This marketing technique will call attention to your home. It is a numbers game. The more people through your home, the more likely someone will fall in love. The incentive is designed to bring more people through. Offer perks for the buyer and/or agents and be too good to pass up.

PAY REALISTIC COMMISSIONS - Remember getting your home shown by the most potential buyers starts in most cases with the Realtor who is selecting what their buyers see. They run a list of potential properties for the buyer to view. Within that range, the Realtor may have 120 or more homes available. They are going to show 10 to 30 or more over the course of a couple of weeks. That's 80 or 90 homes that might not get viewed by the buyer. If you want your home to be one of those shown, sometimes the commission is incentive to put you on the "show" list. We all KNOW a buyer isn't going to buy your home if it is not right for them, but being a marketing and numbers game... The more people who see your home, the more likely someone will fall in love with it. Remember the Realtor can work for weeks or months showing a buyer homes and then months for the escrow period and the Realtor doesn't get paid unless they write the offer on a property for that buyer. Sellers who are in sales understand this concept. Increase realtor incentives and be too good to pass up.

There are other ideas that make a difference too, Realtors do broker tours for other Realtors. That Realtor won't have to preview your property to see if it is right for their buyer as they'll have already been in it. It saves them time and makes it more likely your home will be shown if they have someone today or in a few weeks in your price range.

Open houses with purpose and incentives, root beer floats in the summer (outside of course), balloons on signs, invitations to neighbors for early viewings, lottery tickets for viewing homes you list, limousine tours, and more... Pick a Realtor that is creative and understands marketing. Then take these things into consideration when doing your marketing plan and understand that the Realtor you choose will have more success for you if they have the ability to pay for the marketing needed to get your home out there in all mediums. They need advertising in print, magazines for open houses. They need a strong internet presence through their company, your address (http://www.LasQuebradas.com) websites and all of the Multiple Listing and Realtor.com websites and features that promote your home. The internet background stuff to get the exposure for websites is expensive and necessary for a strong marketing plan for a Realtor that lists homes for sale.

Don't decrease your Realtor's ability to pay for these items... By the time they split their commission 1/3 for their company (sometimes ½), withhold money for taxes and medical (not in their paycheck like regular employees), pay for advertising, websites, tours, flyers, internet sites and internet specific sites for your home, they end up with about 1/3 of their commission. Decreasing their commission may decrease the valuable marketing services they can provide. All of these items, behind the scenes, reflect in your marketing and success. Leave out one website and you could eliminate hundreds of leads possible for your home. RIS Media (Real Estate Information Services) says that over half of all buyers search the internet for homes prior to buying, Realtor.com's study shows 86% of all buyers search the internet for homes prior to buying. That is significant enough to make sure it is a major part of your Realtor's marketing plan.

If you plan to sell your home, be serious about selling. Invest the time and funds necessary to bring your home up to the level that will appeal to the most buyers possible. Offer incentives, a clean, well-kept, updated product, then allow your Realtor the resources to provide the marketing needed, and get ready to move. Short cuts in most things cut into your bottom line. Getting the level of service you expect and deserve should be that simple. BE TOO GOOD TO PASS UP AND YOUR HOME WILL BE SOLD!

Home Staging Advice: 9 Tips to Compete with New Construction - Part 1
by Juliet Johnson - Home Staging NJ

So many homes for sale today have been lived in.  They're fine.  They keep the rain out, there's places for everyone to be, keep stuff, do stuff and be together.  But, they're not new.  They're "pre-owned",  "lived-in",  and "worn" to varying degrees.  How then can these venerable structures retain their value and compete with new construction?

Here is Part 1 of an article I've been working on for a bit now.  The whole article is a bit long for a single blog, so today we'll have Tips 1 - 4.  In part 2, I'll review the survey presented at last month's International Home Builder's Show in Orlando, FL, where a panel of experts discussed what consumers say they are looking for in a brand new house, and then incorporate those "wants" into tips 5 - 9.

Tip 1 -   Lighting

 The biggest "tangible" difference you can make to approximate new construction is to add lighting.  Lots of it. 

Especially recessed lighting.  That says new construction to me faster than anything else.

I like the idea that came up in a previous post - of changing out the switchplates for a crisp new look  - yet wonder if it's ethical to get the electrician in to replace all the thin button switches to the 1" panel ones?  It's looks like then you've updated the wiring, but have you?

I think if you want top dollar in this and indeed any market, you should add recessed lighting.

Tip 2 - Mint Condition

Fresh paint,  Refinished (or Buffed Up) Floors, everything in  like-new or "triple-mint condition" as I often see in listings.

In addition, as we all know and repeat ad infinitum,  you can do a lot to oust that "pre-owned" sense once the whole house is clean, very clean, sparklingly CLEAN!!

A freshly shampooed, or newly installed carpet can have paper or plastic runners/pathways down.  This not only directs the flow, and order of how the home gets shown, but also clearly suggests that there is something on the floor worth preserving!

More and more, I'm having to remind sellers to bleach the grout, or even re-grout (in bathrooms and kitchens.)  Sellers, you need to Kaboom everything in sight, and replace anything seriously moldy, chipped and disintegrating.

Tip 3 - SMELL

All homes have a smell.  New homes, like new cars, have a very distinct, attractive aroma.  What is it? I'm thinking it has to be a combination of paint, varnish, sawdust.... but if I paint my nails near a cedar-scented candle I can't get close!!  (An A.P.B. to Inventors... if you can bottle New Car, can you take a crack at New House?) 

All occupied homes have a certain smell, too.  Usually not the nicest.  Consider shampooing the rugs and carpets, steam cleaning the curtains and opening up the windows for fresh air.  The Fabreze 7 Day Program is hugely effective - I recommend it.  Always have a can on hand to run round your house with it as you're turning on lights, just prior to a showing.

Tip 4 - Certified Pre-owned

It worked for Lexus.  Then BMW, Mercedes and now it's so standard there's an auto industry acronym - CPO.  "Can I interest you in a CPO?"  (And we all thought CPO stood for Certified Professional Organizer....)

Some realty offices offer an inexpensive home warranty program.  This is a great way of assuring the buyer that all the equipment is in fine working order and if not, it's covered by insurance.  The risk shifts to the seller and the buyer feels more at ease.

You can extend your current warranties on appliances and offer that as an incentive to the buyer.  This again shifts the risk and ameliorates the anxiety.

Any brand new appliance should have its sticker still on with the energy savings, etc. but more on that in Part 2.

We have had good success with these tactics and other staging principles, here in the $1 - 3 million niche of homes in North Central New Jersey.  Stay tuned for Part 2....

....where I'll review the list of "wants" people are asking for in new homes, as identified at last month's International Builders' Show in Florida.  Then I'll answer those wants with tips 5 - 9. 

© Juliet Johnson Staging

Home Staging Advice: 9 Tips to Compete with New Construction - Part 2
by Juliet Johnson - Home Staging NJ

So now that we have the standard staging stuff out of the way, in part 1, let's drill down and look at what the "new construction" really means to a buyer.

At the recent International Home Builder's Show in Orlando, FL, a panel of experts discussed the following "wants" surveyed consumers are looking for in a brand new house:

1.   A home that accommodates a modern lifestyle. The most important part of that home is the place where family and friends gather, the kitchen and the family room.

2.   A home that is flexible for their future needs. Half of the readers on the panel under the age of 43 said they were going to need a dedicated office at home in the coming years, as more anticipate working full-time from the house. One-third of the baby boomers on the panel said they anticipated that their house would have to accommodate an aging parent who would move in in the future, and one-quarter said their house would likely have to handle the return of an adult child.

3.   A house that is "special for me." There has been a proliferation of specialty spaces within homes where hobbies and activities take place, and those spaces need organization and storage. Laundry rooms, mud rooms, family rooms and kitchens are all important areas where special touches can go a long way in personalizing the space: built-ins in the family room, restaurant-style cooking equipment in the kitchen, mud rooms with organizational centers and laundry rooms with fold-away ironing boards among them.

4.   Green options. Most of this we realtors & stagers already knew. (though I would debate how serious any American is on Green Options, myself included, compared to the Europeans!)  As with all information, it is in its application that it becomes worthwhile.  How do we apply this into the brick and mortar, pre-owned structure we're attempting to market?

Here's my thoughts - in tips 5 - 9 - and let's see if you agree with me....

Tip 5 - Illustrate the Modern Lifestyle. Whenever asked to illustrate the "Modern Lifestyle", I think of open floor plans, flex-use spaces, uninterrupted pathways etc.  However, the bottom line is that  most families live in the Kitchen and Family Room.  These 2 rooms have to feel connected, and if not absolutely contiguous (i.e. they share a common wall) then move the rooms around until they do.  Connected by color, open (take the door between off) thematic (keep it generic, people... now is NOT the time to indulge your inner flamingo) and intention.

Think about how we all really LIVE... we eat, we talk, we play, we compute, we self-clean and go to bed. Take out washing and sleeping and where do we do the majority of all that?  The Kitchen-Family Room, I would guess.

In smaller houses, put the DR at one end of the LR, like an appartment, and make over the Dining Room as a Family Room.  It's extreme, and I can hear the young female buyer wistfully murmure "I've always wanted a Formal Dining Room"... the truth is, guys, you aren't going to use it.

In larger homes, make sure that the FR is opne, light, bright, and the most inviting space there is.  If you can only afford to paint one room, do the FR.  Make sure the sofas are soft, comfy, with thick, luscious throws and soft, cosy pillows.  Add items that say "snuggle, read, play, revel, savor "  You want to illustrate a life of quiet, unfettered J O Y"

We need to give our buyers rooms and spaces that can accomodate the way those buyers want to live.  We're a creative lot, we stagers, we can do this, and we must if we are to maximize the opportunity of the sale (there's a mouthful, huh?!!)

Tip 6 -Outdoor Living Spaces. Let's stay on lifestyle. Outdoor spaces.  Any place outside that you can entertain, enjoy the sun, read the paper... I'm not sure how many people have time to do this, but it seems to be how everyone sees themselves living in an ideal world.  

The fundamental impact here is adding square footage of livable space to the home.  To add a patio, nook on gravel with bench, pergola... is a lot less expense than an addition, and yet it gives you more places to go "be" in the home.  Open grass is great if the home is in an area where families with grade school kids live.  However, if you're in a move-up zone, your teens only want to be outside to sunbathe (or worse!) Start carving up that lawn into livable sections of additional, livable square feet.

Tip 7 - Flex Spaces -- Offices vs. BRS. We've people say they want a home office.  We've had that for a while, and it's easy to designate a table as a desk on each floor.  The need for an adult child to return home...oh please, no!!  I can see a parent coming for an extended stay... what are they really asking for?  A BR that can be seperated from teh rest of the house?  Sounds like an opportunity over the garage. 

A 1st floor bedroom?  That's what's here at 194 Long Hill Drive, Short Hills, NJ -- a home being marketed at the moment.  It's hard to make these spaces look like both alternatives: a lovely big coffered ceiling'd master, or a coffered ceiling's library with full bath replet with soaking tub and twin sinks!  Inevitably one compromises, and hope the buyer can see that either one is possible.

The takeaway lesson from here, the message not to miss, I think, is that you show an upstairs bedroom as a flex office-BR always.  Even in a 3 BR home.  My mother used to have a table that unfolded into a single bed, with springs, quite comfortable.  Amazing that the day has come when I really am missing that thing!!

And call it that on the floorplan.  (another tip: realtors, always label the floorplan with "/" so that the buyer takes away the options in writing.  You've told them, for sure, but it will remind them when they review the floorplan at a later discussion.)

Tip 8 - Special Spaces. There was a 50's bar in a basement that we re-purposed as a kid's ice-cream parlor.  Since it was next to playroom, it made sense.  Since the playroom was in the basement, this incented our guys to go down there.   (This home took awhile to sell because the kitchen was yet to be done.  People loved it, and thought it charming, but until it was the category leader at its price, no-one wanted to take it on.)

Special Spaces.  A gift-wrapping center.  A corner designated "Creation Station" with all of the paints, crayons, Playdoh  (.....aaaaagh, don't get me started there....a stager's living DEATH....that stuff gets trodden into everything!) The Appreciation Chair (more to come on that, another day), the sewing machine.  The advantage with an owner-occupied home is that all the stuff is already in the home to create these micro-dens for hobbies.  Basics, like a Mud Room, space to iron, "organization center"...show 'em off if you've got 'em.  If not, that's why the people want to move, no?  In vacants, we have to suggest them wtih pieces we're charging out per item.  It's a trade-off, but one that clearly speaks to what the buyer themselves state they want.  

Tip 9 - The  Green Card. This is very simple.

Play up anything green, energy saving, state of the art.  Even if it's only a garbage disposal unit, it's an asset, an investment, an "upgrade"...

Remember the market we're in.  You're competing against new construction - where upgrades and brandy-new are the stock in trade.  Play it back.  Replace appliances, shower heads, faucets... anything cruddy, moldy, scratched, etc.

I'm not sure it's ethical to simply switch out the front of an appliance.  It's an excellent cost savings, but is it honest?  If the thing works perfectly then maybe it's a design decision, but if the dishwasher oozes foam no matter what the cover, the decent thing to do is replace it.  (Don't give me a credit a closing... I'll try and take $5K off the price!)

Conclusion

In the end, can it be done?  Sure. Do you have what people want, priced correctly?  Only you and your realtor know the answer to that one, but chances are, with these 9 tips in hand, you can compete favorably and successfully.  At least, now that you know what buyers are looking for, you know the game you're in.  Now that you're in it, you can win it. 

God speed!

©Juliet Johnson Staging.  All rights reserved.

May 2, 2006 - Good Morning America, ABC 

When getting ready to sell a home, investing a little money into sprucing it up can result in big dividents in the final price tag.

Barbara Corcoran, "Good Morning America's" contributor and founder of the Corcoran Group, said that in general, home staging could increase the final sale price by 5 percent to 20 percent.

Her tips for home staging are below.

Make a Good First Impression
You start the home-staging process by sprucing things up inside and outside so that your home will make a great first impression. Some of the things on this list won't cost any money, like opening windows and sending pets to grandma's, which is always good for making sure the odor of your home doesn't offend potential buyers. Other simple things won't cost much: Paint the front door ($25), put out flowers ($100), mulch the front yard ($65). Spending less than $200 is worth it when you consider that people decide whether they want to buy a home within the first eight seconds.

De-Clutter
A neat closet is a sign of a house in good working order, and be forewarned - people do look in your closets. Prospective home buyers also need to see themselves moving in the space, and they can't see past clutter. Rent a van to dump old furniture ($75), clean closets ($0), clear off countertops ($0), and change doorknobs ($40). Spending about $115 is not bad if it adds to the final resale value.

Let the Sunshine In
Lighting is the number 2 reason home buyers cite for choosing a particular property. Number 1 is location. The third step in home staging is to make sure you let the sunshine in. Clean the windows with Windex ($4), dump old drapes ($0), replace lampshades ($100), and buy stronger light bulbs ($25). Total cost will run you about $129.

Freshen the Bathroom
A bad bathroom is the number 1 turnoff that can kill a sale. Everyone hates a dirty bathroom, and cleanliness is key to moving property in a slow market. The bathroom is also the most personal space in the home, so do everything possible to depersonalize it. To freshen up, regrout tile ($15), caulk the shower ($5), buy a new shower curtain ($20), and invest in new hand towels ($20).

"Staging speeds up sales in a sluggish market, and can bump prices 2% to 10% in a moderate market. The biggest advantage occurs with luxury homes or in a market with bidding wars over properties, where effective Staging can booste prices by 30% to 50%"

- Wall Street Journal, April 30, 2003

Whether it's a way to differentiate yourself in your
marketplace or sales aid to give higher or faster offers,
staging is a tool that all successful salespeople should add
to their bag of tricks.

Enter, Staged Right. Choosing and Using a Professional Stager, ,Robyn A. Freedman, Realtor Magazine Online, 4/1/2003