Inman Handbook: Home staging in the midst of a red-hot market

Marian McPherson

4 years ago

The National Association of Realtors’ 2021 Profile of Home Staging revealed 53 percent of real estate agents don’t stage their listings, although nearly the same amount admitted staging resulted in higher offers from prospective buyers.

The temptation to skip staging is higher than ever, as buyers offer more than top dollar for listings that would’ve been skipped over in a more normal market.

“It’s great they’re selling fast, but staging is going to get more money. That’s the bottom line,” Real Estate Staging Association CEO Shell Brodnax said. “A lot of [buyers] are saying, ‘I’m all in, I’ll give them their list price and get it done.'”

“That happens quite often and that’s awesome,” Brodnax added. “But if you stage it, you are more likely to get multiple offers, and that’s the only time that you can really capitalize on making more money off the list price of your home.”

Brodnax, along with two other leading physical and virtual staging experts, gave Inman the low-down on staging during a red-hot market and how it can help garner the best outcome for sellers. Here’s what they had to say about pricing, finding a stager, staging options and how to get the most out of the investment.

Table of Contents

The average cost of home staging
Finding a qualified home stager
The ABCs of physical staging
Jumping into the world of digital staging
How to get the best out of your stager

The average cost of home staging

Agents should expect to spend an average of $1,409 for a home staging, according to HomeAdvisor’s 2021 staging report. On the low-end, agents spend around $150 just for a consultation to help them begin a DIY staging project. On the high-end, agents spend upwards of $4,000 for professional staging, which continues until the listing is sold.

Staging includes a consultation fee, monthly furniture and decor rental cost, and a fee for the staging process, which is typically charged on a per-hour basis. Staging a vacant home is more expensive, the report explained, as there’s no existing decor the stager can work with. Meanwhile, staging occupied homes is more about decluttering and organizing than bringing in new pieces.

Depending on the condition of the home, HomeAdvisor said staging could include interior ($1,750) and exterior painting ($2,800) projects, installing new lighting fixtures ($460), refinishing cabinets ($2,700), floors ($1,700) or furniture ($590 per piece). Stagers may also suggest a professional cleaning, which tacks on another $170.

Brodnax said real estate agents should also encourage their sellers to purchase insurance to cover the stager’s items, in case they’re damaged during showings or due to an unforeseen event, such as flooding. Homeowners can purchase a policy for as little as $300, depending on how much furniture and decor the stager uses.

“In May of 2019, I moved and had my home staged. It was beautiful and it sold within the first week,” she said. “By the end of the second week, there was a flood in my home, it caused $42,000 worth of damage and I was no longer in the state, as I’d relocated to my new home in North Carolina.”

“We had to destage it, pull it off the market, and do all the repairs. It was just a train wreck and thankfully I had stagers’ insurance,” she added. “If the flood level went any higher and I didn’t have insurance, I would have been in the hole $18,000, and I would’ve used my equity to replace her furniture.”

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Finding a qualified home stager

Brodnax and staging experts Ilaria Barion and Teresa Smith said a common mistake agents and homesellers make is thinking interior designers and home stagers are one and the same.

“The difference is that stagers understand real estate, whereas just a regular designer if they’re not doing staging all the time, they really don’t have any knowledge of real estate,” Broadnax said. “In addition, the scope of the work is completely different.”

“When you hire an interior designer, you want to customize the space for you. If you like purple and gold, they will give you purple and gold wherever it is that you want it,” she added. “However, when you work with a stager, they’re helping you sell your home and appeal to buyers.”

Brodnax said agents need to make sure they’re hiring a professional instead of a hobbyist. Although hobbyists can do a good job, she said professionals have access to better inventory, insurance to cover their inventory and workers, reliable and experienced movers, and have the real estate knowledge to truly highlight a listing’s best features.

Shell Broadnax

“A hobbyist might be somebody that is potentially working without insurance. They could be hiring movers, like Two Dudes in a Truck, and if those people are owner-operators for their own business, which is moving, they’re not required by law to carry workers comp insurance,” she explained. “If a mover gets hurt and they racked up thousands of dollars worth of hospital bills, they’re going to want to sue the stager, the homeowner and the agent.”

“So that’s a big thing that any agent should ask a stager about,” she added. “Only choose those who have insurance to make sure that everybody that’s moving any furniture is covered by workers comp.”

Brodnax also said agents need to look at a prospective stager’s portfolio and client reviews. The first red flag is when stagers haven’t invested in professional photography.

“If they’re not willing to make the own investment in their own business to market and build their own brand correctly, then, how can they be preaching that you need professional photography with your clients?” she said.

From there, she said agents need to ask about stagers’ inventory. Are they solely pulling pieces from furniture and decor stores or do they have their own warehouse with a variety of options to fit every sellers’ needs? If they’re solely relying on one-time pulls from decor partners or have an outdated personal inventory, Brodnax said it’s time to look elsewhere.

“If you have a unique home, you want to inquire if they’re able to stage that type of property, meaning is their furniture going to support what’s required for the architecture in order to make it show really well?” she said. “You want to make sure that they have access to different styles of furniture.”

Lastly, she said agents need to make sure stagers are team players and truly understand the importance of the work they’re doing to help sellers.

“Don’t hire a stager that’s just going to do one-offs, because you won’t develop a solid professional relationship,” she said. “Find that great stager that’s a valued part of your team, and take them with you on every listing. That stager is going feel relied upon, and they’re going to go that extra mile.”

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The ABCs of physical staging

The most common staging option is physical staging, which refers to the process of a stager coming to a listing and staging or organizing it with the help of assistants and movers. Oklahoma City-based stager Teresa Smith started as a hobbyist and over the past four years, has become one of the city’s top professional stagers.

Teresa Smith

“I started doing [staging] for real estate friends as favors,” she said. “I’ve always loved everything dealing with homes, and as a matter of fact, I also have a real estate license.”

“It really helps me understand what Realtors need for their clients because I know what it takes to actually sell the house,” she added.

Smith said all of her projects begin with a paid consultation where she’ll tour the listing, talk to the agent about the seller’s needs, and research the demographic of the buyers who are flocking to the area the home is located. From there, she’ll create a plan for which rooms to stage, which is usually just the living room, kitchen, dining room, and main bedroom and bathroom.

Next, Smith will send the agent an estimate, which includes fees for moving and arranging the furniture, a 60-day furniture rental fee, and another fee for furniture pickup. Smith also offers insurance, in case any of her pieces are damaged during the 60-day rental.

“I started with a 30-day rental fee, but I changed it to 60 days because it takes a while to get the inspections completed and it takes a while for the appraisal,” she explained. “You want to make sure that contract is pretty secure before you remove the items and hopefully that gives everybody enough time to make sure the financing is good.”

Although it’s not common in this market, Smith said she still offers a month-to-month furniture rental plan for listings that take more than 60 days to sell. She asks agents to keep her informed about the sales process so she can move the furniture before the new owners move in. “Seven to 10 days notice is best,” she said.

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Smith said the process for occupied homes is simpler (and cheaper), as most of her job is about decluttering and organizing. She said cluttered homes prevent buyers from getting a true feel for the home since their attention is on the perceived lack of space.

“It usually takes anywhere from an hour to three hours to go through the house with the client,” she said. I usually tell them to remove about 50 to 75 percent of their belongings. It’s so important with getting the house ready.”

“If you walk into somebody’s house and the countertops are cluttered, the cabinets are overflowing, the drawers are overflowing, and the closets are just overflowing with stuff, people will perceive that as there’s not enough room in this house, even if it’s twice the size of what they currently have,” she added.

Smith said even in Oklahoma City’s booming real estate market, she’s still getting plenty of staging requests from agents. The turn-around process is faster, she said, but her clients tell her the staging is worth it, as they’re getting multiple offers well above the asking price.

“You’re going to get a six to 10 percent increase in price. It can even go up as high as 20 percent, depending on the listing,” she said. “Even though it’s probably going to go under contract pretty quickly, the more somebody falls in love with a property, the more valuable it is to them.”

“They’re going to do whatever it takes to get that home because they can see themselves living there,” she added. “So that’s why it’s so important to stage. You want them to have that emotional connection.”

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Jumping into the world of virtual staging

New York City-based stager Ilaria Barion has been staging some of the most luxurious listings in New York City, Los Angeles, San Francisco and Chicago for nearly 20 years. Barion started her career as a physical stager; however, she transitioned to virtual staging in 2010 as the emergence of online listing portals digitized the home-shopping process.

“I saw the opportunity of virtual staging, because my clients were selling high-end properties and I realized there was no one offering virtual staging for the luxury real estate market,” she explained. “Virtual staging started as a very inexpensive way to stage properties that were not worthy of physical staging.”

Ilaria Barion

“It started with dropping a 3D set into the picture of a cheap apartment, and now we do $70 million homes with a digital staging that is super luxurious and super photorealistic,” she added.

Although some physical stagers are hesitant to call Barion’s work staging — “I like to call them artistic renderings,” Brodnax said of the growing field — Barion said her process is identical to physical stagers, except for the process of pulling, moving and organizing actual furniture.

Instead, when it comes time to stage, her team will professionally edit photos provided by the real estate agent. For homes that are furnished, Barion will digitally remove clutter, switch paint colors and swap select pieces of furniture and decor that wouldn’t appeal to the buyer demographic that’s most likely to purchase the home. For vacant homes, Barion’s team has more freedom to play around with custom-designed virtual furniture, decor and room layouts.

“When you think of virtual staging, most people think it’s just empty rooms and we add the furniture, but we can do much more than that,” she said. “We can change paint colors or declutter or redesign the living room, which has been turned into a playroom.”

“Physical staging requires a significant amount of work and the willingness of the people living there, and that’s when the digital staging is a perfect choice,” she added.

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In addition to removing the stress of living in a staged home, Barion said digital staging is more cost-effective since sellers aren’t shelling out cash for insurance and rental fees. “It’s not just the staging consultation and design fee. If it takes three months to sell that home, you pay a rental fee,” she said. “So the longer it takes to sell, the more money the stager makes, which is counterproductive but that’s what happens.”

Barion said virtual staging has been a mainstay in New York City for almost two decades, but homesellers in other luxury hotspots, especially in California, are quickly warming up to virtual staging, in part due to the pandemic.

“I don’t need to explain to you that over 95 percent of people start their home search online. So the way the property looks online is what generates traffic,” she said. “California has changed during the pandemic and they’ve kind of discovered virtual staging. I mean, there’s no reason to physically stage a home anymore.”

When finding a virtual stager, Barion said it’s important to make sure the company has in-house designers and editors who truly understand staging and what buyers want in their respective markets. She said many U.S.-based virtual staging companies will outsource work to photo editors overseas, who don’t understand staging basics.

“The photos must look realistic,” she said. “The most important thing is don’t hire a tech company that doesn’t know anything about home staging because what is going to happen is that they may be good technically, but the layout will be completely wrong. I’ve seen stuff like furniture blocking the views.”

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How to get the best out of your stager

Brodnax, Smith and Barion said real estate agents must learn to see stagers as a must-have instead of a nice-to-have in their homeselling game plan. When they do that, they said, stagers will go above and beyond to help seal the deal.

“Communication is key,” Smith said. “I love the agents that keep me posted on their timeline, such as when the home is under contract, or when the appraisal and closing are done, and when the new homeowners are scheduled to move in.”

“They have to understand we really are all working as one team,” she added. “Everybody wants the same end result: We all want the house to sell as quickly as possible, but also for top dollar.”

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Email Marian McPherson