Do Real Estate Agents Pay For Staging?


So you are trying to sell either your personal or investment home. There are many things to consider after making the decision to sell including: if you should use a real estate agent, and if so, what agent should you choose, deciding an asking price that is neither too high nor too low, and etc.

Another question you may be considering is whether or not to hire a staging company to come into the home and stage it for potential buyers.  You may be asking yourself if it is worth it? Will it make my house sell faster? Will I get a greater return if doing so? Well, there really isn’t a one-size fits all answer to this question, which is why this can quickly turn into a hot topic among real estate agents. Most agents will outright refuse to pay for staging. However, it is always up for negotiation.

In my experience, a real estate agent will pay for staging only if they believe it will bring a significant increase to the selling price of a home and in return, more commission for themselves.

Why an agent would pay for staging?

After speaking with many real estate agents, I have found that few have said they would be willing to pay to stage a home. On the other hand, more agents did say that they would be willing to pay for the consultation as part of their marketing plan and then use the consultation as a gift.

Many times, if you are willing to purchase your next home with the same agent, then they are more likely to pay for a full staging of a home. In my own experience, I have found that by using my same agent multiple times within a year will most often prompt the agent to pay for staging without me even bringing it up.

Appearance is everything

When trying to sell a home, potential buyers need to be able to see themselves living in the house with their families. It is no secret to agents that the pictures taken of their properties can significantly increase the amount of interest. Staging a house ensures the ability to take some great photographs.

Luxury properties are more likely to be staged due to the massive amounts of commission for agents. When you start looking into multi-million dollar properties you will find that buyers and sellers are more likely to purchase homes that are already furnished.

Sometimes, it is too much of a hassle for the buyers to pack and transport all their furniture during a move.  So, as an alternative, many buyers prefer to purchase the furniture along with the property.

When it comes down to it, real estate agents are working for you.  If you agree to hire an agent at a higher commission rate, then the agent will be more inclined to pay for staging. Since they are already going to be making more on the sale, they usually won’t mind to pay for something that will make the both of you a bit more money.

Why an agent would not pay for staging

Staging a house is not always in the best interest of the agent.  Some may say it is too risky. There are a handful of scenarios where staging a property could actually backfire on the agent.  One example is if the seller ends up changing their mind about selling.  In this case, the agent has already paid out of pocket possibly thousands of dollars depending on the size of the home and are unable to recoup their loss. 

In addition to the seller backing out, there are many things that can impact the sale of a home. Staging companies usually require payment up front, so if the buyer is unable to qualify or backs out because of some unforeseen reason, then the agent has once again lost their money and has no way of getting it back.

Even if all goes to plan and the house sells for $20,000 more than the asking price, the agent won’t realize the gain as much as the seller will. In this case, it might only be a couple hundred dollars back to them.

The biggest benefit to the agent is the house selling more quickly. While this is a great advantage, it isn’t necessarily worth it for the agent due to the fact that you never really know if the staging is what actually sold the house fast.

Do real estate agents believe in staging?

Simply put, yes. This is why they are willing to pay for a consultation. The consult is an attempt to entice you into hiring a company to stage your house on your dime because they know it will help them sell. They know they will be able to get better pictures, a better showing, and it may also speed up the amount of time it takes to complete escrow.

Some agents will say that staging is unnecessary, or that it depends on the current real estate market. Their advice to stage a home is determined by the following questions: is the timing right, is it the right property to do so, and is it the right situation?

Benefits of staging

  • Better pictures: gives the impression of a well-kept home, in addition to how the house will look with nice furniture and décor in it. 
  • Better showing: potential buyers enjoy visiting properties that look like they are lived in well. It puts your property at a higher standard than your competition.
  • More offers: if your agent markets the property correctly, more people will know that the house is staged. This means more people will view the home and you may get more offers.
  • Quicker sale: buyers often times move more quickly due to more competition. The eagerness to obtain the home will prompt more solid offers.
  • Helps justify the asking price: your home will seem a notch better than the rest just by having it staged. A pleasant looking house plays on a potential buyer’s emotions.
  • Helps buyers see themselves in the house: potential buyers will be able to see what the home will look like when fully furnished.
  • Better first impressions: staging will help paint your home in a better light. If the house has good “curb appeal,” the potential buyers maintain that impression as they walk through the door.
  • Professional designer: you get the benefit of someone who is an expert in his or her field. Stagers work with many real estate agents and usually have a knack for what looks good and what doesn’t, along with what will sell and what won’t.

Can you stage your own home?

Absolutely! If your agent offers a free staging consultation, then be sure to take notes though. Ask them as many questions as you can think of and listen closely to what they have to say.

If you are not able to get help from professionals, then here are some things to keep in mind.

  • De-clutter as much as possible. This is extremely important in order to make space seem bigger and more open.  
  • Take down pictures of your family.  This may seem odd, but having pictures of your family on the walls and tables will actually distract the potential buyers from seeing themselves living there. You want people to walk through the home and be able to picture their family living in it, which is difficult to do if they continue to see photos of some other family.
  • Ditch any items of achievement you have on display. No buyer wants to see your accomplishments for the same reasons why you want to get rid of family photos.   
  • Deep clean your house. The goal is to make your house look new and fresh by cleaning items such as appliances, floor, wall paint, baseboards, furniture, windows, and more. If you can manage it, consider hiring a house cleaner for a one-time cleaning, and even a professional carpet cleaner.  Each will most likely cost a couple hundred dollars, but both are well worth the cost.
  • You may also want to consider purchasing a new comforter and pillow shams, or even new small appliances. Although these items are completely necessary to do, they will add to the overall look of the home.  You never know, it may just be that little extra that push potential buyers into making an offer. 

Why home stagers want to be paid up front

Staging companies require payment up front for a very good reason.  There is never a guarantee the property will sell, and the company can’t afford to leave their items at a property only to hear that the home won’t close. They have no control over any of the different variables that go into the home selling process. It does not make any sense for them to take on the unnecessary risk of being paid in escrow.

If for some reason a home stager agrees to be paid in escrow and ends up not getting paid, they have little to no recourse. Being paid up front ensures that they can continue on and have a thriving business. If the home stager does a good job, then, of course, they deserve to get compensated for their work, even if there are no offers or the sale of the house falls through?

When not to stage

Do not stage a fixer-upper. Buyers know when a seller is trying to hide something. If there is a big hole in the ceiling or the kitchen faucets looks old and broken, then even the nicest sofa and beautiful artwork won’t cover those things up.  In these types of situations, it is just not worth the extra money to hire a staging company.

If your agent is pushing you to stage, but you don’t think it is necessary, then offer to allow them to pay for it themselves if they really think it will help. If they decline then you know it wasn’t that important to the safety of the home in the first place.

Where to find a home staging company?

One almost sure-fire way to find a staging company is to ask your real estate agent. Unless the agent you are using is brand new, I can almost guarantee they have someone they work with. If your agent doesn’t know of someone, then ask them to talk to his or her broker and obtain a stager that way. 

Home staging is area specific, so if you are looking for a consultation, it is pretty easy to find one on a simple Google search.

Staged vs. Un-staged

In a staged setting, you are able to control what the potential buyer sees. You can set the tone for the house and give whoever walks in a comfortable feeling. Staging gives people an idea of how to organize a space, which can then jumpstart their imagination.

Staging does cost money, sometimes a lot of money. There are times when you may invest a large amount and still get no offers, which then leaves you in a worse off position.

Un-staged homes can come across as cold and unfriendly. It will never be as welcoming as a staged home.

Even so, not staging a home is the norm and won’t necessarily put you at a disadvantage. However, you are less likely to stand out from the rest. 

An un-staged home can take longer to sell and the seller will have more carrying costs associated with the sell.  Also, consider that the longer the house stays on the market the more likely it is that price reductions may need to occur. If the home was staged, then it may have been able to sell faster without the need to reduce the asking price. 

Is it really worth it?

Most agents agree that staging does help the selling process. However, home staging has never and will never be a must have to sell your home. If you are looking to sell quickly and need to give yourself the highest chance to sell on time for the highest price, then staging your home may be for you.

Over the last eight years of investing in properties, I have only staged one of them. The only reason I did was that my agent brought it up and offered to pay for it. Otherwise, I wouldn’t have even thought of doing it. I did get two offers that were above my asking price, and thankfully it appraised for what they had offered.

I would have to say that staging that house may have made a difference in the quality of the offers I received, yet I didn’t notice a difference in the speed of them coming in.

Staging is a nice touch, but to me, it will never be a must. Your best bet is to find a realtor you trust who has a great amount of experience with the property you are trying to sell. Not all agents are created equal, and just because one didn’t work out for you, does not mean no agent will.

About The Author

Geoff Southworth is the creator of RealEstateInfoGuide.com, the site that helps new homeowners, investors, and homeowners-to-be successfully navigate the complex world of property ownership. Geoff is a real estate investor of 8 years has had experience as a manager of a debt-free, private real estate equity fund, as well as a Registered Nurse in Emergency Trauma and Cardiac Cath Lab Care. As a result, he has developed a unique “people first, business second” approach to real estate.

Check out the Full Author Biography here.

 

This article has been reviewed by our editorial board and has been approved for publication in accordance with our editorial policy.

 

Geoff

Geoff Southworth is the creator of RealEstateInfoGuide.com, the site that helps new homeowners, investors, and homeowners-to-be successfully navigate the complex world of property ownership. Geoff is a real estate investor of 8 years has had experience as a manager of a debt-free, private real estate equity fund, as well as a Registered Nurse in Emergency Trauma and Cardiac Cath Lab Care. As a result, he has developed a unique “people first, business second” approach to real estate.

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