If you are at the point in your fix-and-flip project where you need to decide how much to spend on staging...congratulations! You have no doubt worked hard to find, buy and renovate your fix-and-flip investment property--now you just have to get it sold.
Is staging my flipped house really necessary?
In a recent Real Estate Staging Association (RESA) study of 1,081 sold homes, unstaged homes spent an average of 184 days on the market (with no sale) before they were subsequently staged and sold. After staging the unsold homes, they sold on average in 41 days. Homes that were staged prior to being listed sold on average in 23 days:
Days on Market
NOT STAGED at LISTING
Average 184 days on marketSTAGED AFTER NOT SELLING
Average 41 days to saleSTAGED BEFORE LISTING
Average 23 days to sale
This study does not tell us how much was spent on staging, and whether staging included complete furnishing of the home, or if it was limited to plants, artwork, mirrors and other smaller decorative items. However, what we can glean from RESA's research is that your investment of time and money into improving the experience potential buyers will have when they walk through your property (or view photos of it online) will help you sell your property much more quickly.
Another benefit of home staging is that it increases the home's perceived value in the eye of the buyer, which can return a higher sale price.
- "Staged homes, on average, sell for more than 6% above asking price."
-Coldwell Banker - "Making a 1-3% investment in home staging yields a return of 8-10% ."
-National Association of Realtors (NAR) - "The cost of staging is always less than your first price reduction, which is typically 1 to 5% of the asking price."
-RESA
All of the above data imply that if you would like to sell your fix-and-flip property more quickly, and for more money, staging your house flip should be a top priority.
What will a professional home stager do?
If you are working with a budget that can accommodate a complete staging of your house flip--with furniture, artwork and decorative items placed throughout the home--the professional home stager will visit your empty property and create a design plan for each room. The stager will deliver and set up everything, and will remove all of the items once the property is sold.
Of course, the cost of staging will vary by local market and by the size of the home as well as other factors (standard vs. luxury) but generally speaking, you will be charged an initial consultation fee ($0 - $500) and a fee for the delivery and installation of the furnishings ($1,000 - $20,000), as well as a monthly fee for the rental of the furnishings if they remain in the home beyond an agreed upon time period (such as 6 or 8 weeks).
Can I stage my fix-and-flip property myself?
You absolutely can stage the home yourself if you have the time and talent to do so. Keep in mind that buyers want to be able to visualize themselves living there, so if you do not have the eye and the instinct for what buyers will love, get input from someone who does before you rent or purchase furnishings.
How much should I spend on fix-and-flip staging?
Spending on staging varies by market, however, the general rule for home staging cost is about 1% of home value. If your house flip is a $5 million dollar Malibu mansion, spending $50k on home staging can bring you the high-end buyer you're looking for. Conversely, if you are listing a $250k flipped home, consider spending $2,500 on staging to give your home the stylish appeal it needs.
What if I can't afford to stage my fix-and-flip property?
If you are already maxed out on spending on your house flip, a few thoughtfully placed items such as plants, candles and framed photos can warm up the interior of your home and improve its chances of attracting a buyer.
One option you should consider if you are on a strict budget is "virtual home staging." With a virtual home staging company you send them photos of your empty rooms, and they digitally insert furnishings. These virtual home stagers provide high definition photos for a reasonable price that you can use for your online listings, and, you can have the photos printed out and displayed in the rooms to give buyers an idea of what is possible.
Be aware that there are real estate agents who know the value of home staging, and will offer to provide it free of charge. If your agent does not offer this service, let them know you don't have room in your budget for staging and ask them if they will consider sharing the cost of a physical or digital staging fee.
If you are seeking guidance as you travel down the fix-and-flip road, we encourage you to contact the experts at Anchor Loans. We’re here to answer any and all of your questions, and we look forward to hearing from you soon.
Ready to apply for a fix-and-flip loan from Anchor Loans? Check out this helpful article on how to get approved.
