Flipping homes has become a popular investment strategy, with many real estate professionals and DIY enthusiasts turning distressed properties into lucrative assets. One key component that often comes up in discussions about selling flipped homes is staging—the process of decorating a property to make it appealing to potential buyers. But does staging really make a difference when it comes to selling a flipped home? Kory Habiger of Kansas will explore the role of staging in real estate, the impact it has on buyers, and whether or not it is a worthwhile investment for house flippers.
What Is Staging and Why Does It Matter?
Home staging involves arranging furniture, decor, and other elements in a way that highlights the property’s best features, creates a welcoming atmosphere, and helps potential buyers imagine themselves living in the space. Staging is particularly important for flipped homes because these properties are often completely renovated and have a fresh, clean slate—ideal for showcasing potential.
The main goal of staging is to make the home more appealing to a broader audience. Buyers don’t just purchase a house; they purchase the lifestyle that the home promises. Staging helps them envision that lifestyle by offering a glimpse into what life in the home could look like. It can turn an otherwise cold, empty space into a warm, inviting one, which could lead to a quicker sale at a higher price point.
The Psychology Behind Staging
There is a significant psychological aspect to home buying, and staging taps into this. Many buyers struggle to visualize how they might use an empty or poorly designed space. A staged home eliminates this problem by giving buyers a clear picture of how the space could be utilized.
For example, in a flipped home with an open floor plan, staging can define different areas like the living room, dining space, and reading nook. Without furniture or decor, it might be hard for buyers to picture how they would set up their furniture or how much space they actually have. Staging helps eliminate guesswork by providing a clear layout and making the property feel lived-in.
Moreover, first impressions are crucial in real estate. When a buyer steps into a home and sees it thoughtfully decorated, it often generates an emotional response. They begin to picture themselves living in the home, entertaining guests, or relaxing after a long day. This emotional connection can be the key to closing a sale.
Staging vs. Selling Vacant Flipped Homes
Flipped homes, which are usually fully renovated with new finishes and updated layouts, already have a leg up on traditional homes in terms of appeal. However, selling a flipped home without staging can be a missed opportunity. While some real estate investors choose to sell flipped properties vacant, thinking the renovations speak for themselves, this strategy might not always lead to the best results.
A vacant home can feel impersonal and even overwhelming. Buyers might focus on imperfections or be distracted by the sheer openness of the space. In contrast, a staged home gives a sense of warmth and personality, which is often more inviting and memorable for buyers.
Data supports this. According to the National Association of Realtors (NAR), 83% of buyer’s agents said staging a home made it easier for a buyer to visualize the property as a future home, and 44% reported that staged homes sell faster. The investment in staging might seem like an added expense, but when it leads to quicker sales and fewer price reductions, the return on investment (ROI) is often worth it.
The Financial Impact of Staging
One of the main concerns house flippers have when deciding whether to stage a home is the cost. The price for professional staging services varies depending on the size of the home, the local market, and the level of staging required. On average, staging can cost anywhere from $500 to $6,000. For luxury homes, costs can be even higher.
However, staging often pays for itself. Studies show that staged homes sell for a higher price compared to unstaged homes. According to the Real Estate Staging Association (RESA), homes that are staged sell for an average of 6% to 20% more than homes that are not staged. In a competitive market, this price increase can more than cover the cost of staging and boost your profit margins on the flip.
In addition, staged homes tend to spend less time on the market. For house flippers, time is money. The longer a property sits unsold, the more holding costs (such as mortgage payments, utilities, and taxes) add up. By reducing the time a home stays on the market, staging can lead to faster sales and reduced carrying costs, making the entire flipping process more efficient and profitable.
DIY Staging vs. Professional Staging
For flippers looking to save money, DIY staging is an option. If you have a good eye for design and understand what appeals to buyers in your market, you may be able to stage the home yourself. This could involve renting furniture and decor, or even reusing pieces from previous projects.
However, professional staging can often provide better results, particularly in higher-end markets. Professional stagers have experience creating designs that appeal to a wide range of buyers and know how to showcase a home’s best features. They also have access to high-quality furniture and decor, which can enhance the overall presentation of the home.
In some cases, professional stagers can even provide digital staging options. This is especially useful in today’s market, where online listings are often the first point of contact between buyers and properties. Virtual staging allows buyers to see fully furnished rooms without physically visiting the home, which can be a more cost-effective option than traditional staging.
When Staging May Not Be Necessary
While staging has proven benefits, there are scenarios where it may not be necessary. In extremely hot real estate markets, where homes are selling quickly due to high demand and low inventory, staging may not significantly impact the speed of the sale or the final price. In such markets, buyers are often more willing to overlook minor cosmetic issues or lack of staging because they are focused on securing a home.
Additionally, for smaller or lower-priced flips, the cost of staging might outweigh the potential benefits. In these cases, focusing on other strategies, such as competitive pricing or targeted marketing, might be a better use of resources.
So, does staging make a difference when selling flipped homes? In most cases, the answer is a resounding yes. Staging not only helps buyers visualize the home as their own but also increases the perceived value of the property, often leading to faster sales and higher offers. For house flippers, investing in staging can be a smart way to maximize the return on investment and enhance the overall appeal of a property in a competitive market. While it may not be necessary in every scenario, staging is a powerful tool that should not be overlooked when selling flipped homes.