With the current dearth of houses for sale and lines of buyers queuing up to see the few actually on the market, youâ€™d think that the amount of prep work going into homes being readied for sale would have diminished dramatically.
In reality, the overall quality of homes currently for sale is significantly higher than a few years ago. Part of the reason is that weâ€™re no longer seeing the multitudes of trashy foreclosures that dominated the landscape (not only are there fewer foreclosures, those that do appear are in better condition because banks have learned that a small investment in new carpet and paint will reap larger returns).
The real reason, I believe, has to do with the economics of the current market.
In a declining market, sellers realize that theyâ€™ll be losing money if they invest too much in getting their home sold. If they put $10,000 into modernizing a kitchen, they might get $5,000 back. Although they understand the need to make their home as presentable as possible, most sellers will do it on the cheap so as not to lose any more than they absolutely have to. This includes staging.
When the market turns and heads back up, the profit margins change. In the current hot market, home prices are not dictated by previous sales, they are now governed by multiple offers and how much any given buyer is willing to pay. That same $10,000 kitchen upgrade might very well score a $15,000-$20,000 return. Factor in paint, new floors and the like, and the chances of reaping a windfall dramatically increase.
While we might see 3 to 5 offers on a dingy property, well-prepared Bay Area homes are frequently seeing well over 30 offers. The more offers a seller receives, the better the chances of a solid sale at way over asking price.
Sheryl Medford, accredited stager and owner of The Next Stage, a professional East Bay-based home staging company http://(www.thenextstages.com
), states, â€œNot only are we seeing home improvements increase, the demand for staging has dramatically risen as well. Sellers realize that the better their homes look, the higher the price theyâ€™ll receive. We were expecting requests for staging to decrease once the market heated up â€” in reality, itâ€™s been the exact opposite.â€
Interested in maximizing your sale? In the current selling climate, it appears that tasteful upgrades and professional stagingâ€¦ are setting the stage for higher returns.