In a perfect world, home sellers would be able to open their eyes one morning and decide to put their home on the market and would never need to do any work on the property other than making the bed. Reality is seldom perfect. In today’s competitive real estate market, most sellers should expect to spend both time and money to prepare their home for the discerning eyes of buyers.
Determining how much to spend on sprucing up a home before welcoming potential buyers depends on the condition of the home and the price range.
“The budget for preparing a home for sale depends on the condition of the home,” says Dorothy Hall, a Realtor with RE/MAX Leaders in Purcellville. “Sellers should expect to spend a lot if the home hasn’t been maintained, but other homes have been so perfectly maintained and decorated in such a neutral way that the sellers won’t need to spend any money to sell it.”
Chris Fries, a Realtor with McEnearney Associates in Arlington, says that while there’s no formula to help sellers determine how much to spend on fixing up their home, each seller should focus on the fact that to be competitive, the home needs to be immaculate and in tiptop condition.
“If you are selling a $500,000 home, you might want to budget $3,000 to $5,000 for fixing up the home, but it really depends on the condition of the property,” Mr. Fries says.
In addition to sprucing up with paint and polish, many sellers and real estate agents today rely on home staging to attract buyers. Staging a home runs the gamut from removing clutter and personal photographs from a room to bringing in new furniture to present a more appealing space for potential buyers.
“Every listing demands some attention to staging,” says Kevin Reid Shirley, an accredited staging professional and associate broker with Long & Foster Real Estate on Capitol Hill. “For some homes, it’s just a matter of taking down a personal collection, but for others it will take a top-to-bottom re-do to sell the home.”
Many real estate agents, including the Sherry Wilson Team of which Mrs. Hall is a member, include staging services as part of their commission. Others recommend staging professionals who can charge anything from a small consulting fee to thousands of dollars, depending on how much work is required and whether furniture must be rented.
Mr. Fries says a professional consultation with a home stager resulting in a list of suggestions for the home could run as little as $100 to $150.
“In its simplest form, staging should be considered an investment, which can make a home sell for $10,000, $20,000 or even $50,000 more than it would have without staging,” Mr. Shirley says. “In this market, it can also simply make the difference between a home sitting or selling.”
Mr. Shirley points out that staging a home is nearly always less expensive than reducing the price of a home that is sitting on the market unsold.
“The first price reduction for a home is generally about 7 percent of the asking price,” says Mr. Shirley. “Staging never costs that much.”
Scott Miller, a Realtor with RE/MAX 100 in Ellicott City, Md., says that while it is difficult to pinpoint an exact budget for homeowners to spend before listing their home, he estimates that up to 1 percent of the value of the home would be worthwhile for a home that needs a “top-to-bottom” spruce-up.
“Sellers need to realize that they pay a commission to a sales agent to sell their home and a percentage of the sales price will go to the state government, so they should also expect to spend a certain percent on fixing up the house as a part of the cost of selling,” Mr. Miller says.
While the goal of improving the property is to make the home as close as possible to the new model homes buyers are also surveying, sellers should not overspend on big ticket items such as redoing a bathroom or kitchen.