Yesterday I went to view one of my best client's properties. It is newly listed and in very bad shape. I would call this a flip house. I'm not going to show photos because it is currently on the market and I don't want anyone local to be able to connect any dots... I was asked to put together a budget for staging and some inexpensive updates. The budget would be low because they already needed new flooring (it is stripped down to the concrete at this moment).
When we were at the home, I actually called a friend of mine who flips homes and gave him the address recommending this home. Before the client spends any more money, I think this is their best option for a buyer.
Here is a list of some of my recommendations in the home:
- scrape popcorn ceiling
- Prime & paint all trimwork
- replace countertops (they are laminate and cracked)
- take down latticework that covers screens in screened porch
- re-glaze tiles in both bathrooms
- paint entire home
- remove old wallpaper that has been painted over & is peeling from wall (about 3/4 of the home unfortunately) - it may be easier & cheaper in the long run to redrywall these areas...
- replace countertops in both bathrooms
- remove green & gold shag carpet in FROG
- paint entire exterior home including bricks (which are very dated & unattractive), doors & shutters
These are only some of the minimal suggestions. There are signs throughout the home that say, new carpet coming soon. MLS offers a carpet allowance. What I wonder though, is whether the home would be better off with a dramatically reduced price and being sold 'as is' .... the owners do not have the desire to do the needed work - which again is extensive. The home is currently vacant.
What do you think? Would you do some of the items above & replace the carpet or drop the price and sell 'as is'?
----------------------------------------------------------------------------------------------------------------
Melissa Marro, a published artist, now turned staging advocate and national speaker speaks her mind about real estate and the home staging industry. In her 'no holds barred' approach, audience members find real answers to the industries pitfalls and learn how to overcome them with tried and true information and guidance. With marketing as her passion, she turned a small home based business into one of the nation's largest home staging and training facilities. Selling her successful home staging company in January 2012, Marro is now a full time speaker and instructor for Staging And Resign and Real Estate Staging Association (RESA)'s trade events.
For more information on having Marro speak at one of your real estate functions, please contact her at 843.619.1593 or email at marro.melissa@gmail.com
Hi Melissa,
"As is" sales do not cut it here in Reno, NV. Sellers have to compete with builders whose homes are competitively priced and staged. We also have foreclosures that are attractively priced and some are in good condition.
Our median price for a home is $320,000; therefore, home buyers would much rather have a turn key home as they have spent every last dime in purchasing the home. Majority of investors have moved their investing strategies to different state.
Catherine
Hi Melisa,
Any house will sell if it is priced right, it depends upon how much breathing room the sellers have to lower the price. Maybe they are at their ceiling.
Any investor will buy if their is room for their repairs and for them to flip it.
Have your sellers estimate the costs to make those repairs in order to sell and compete with like homes in your market. Then cut the price for those repairs plus another 10 %. Usually flippers want a 10% back in their pocket. If you area is depreciating like our market is here, then you will have to factor the price into a declining market.
Hope that helps,
Kathy Dyer
Melissa this sounds like about 75% of the houses in my area. It's a struggle and a dilemma, for sure. Personally, I say reduce the price and market to the renovators, but I don't find that happening here. Instead these houses are sitting on the market for years...what a drag!
I agree. My Flipper/Investors have a plan for each house that they buy. If this client is a Realtor, then you have a bit of a problem. If it is an Investor, then your suggestions should be part of your service to prepare the house for you to Stage it.
Otherwise.... no amount of Staging will help sell this house if it is below your Staging standards ;) Your choice my friend.
When I posted this I had actually already contacted the agent advising that it was not worth my time or their money to stage the home & that minor changes would not make a difference. I had already contacted investor friends of mine to give them a heads up on a flip opportunity.
I wanted to throw it out there for others to think about.... lipstick on a pig is a good analogy (and one we use a lot in the south). When you are out there working, you need to be mindful of what is best for the client. I know stagers who think more about getting every job than really thinking out what works best for the client... whether it be cutting corners to make more money, charging more than is reasonable or taking jobs that really should have been turned down. I don't imagine they will be in business long, but in the meantime it is good to hear others say what I knew was right.
If the job can't be done right - done to the CLIENT'S best benefit then it should not be done at all... Thanks a bunch for all the comments!
Good Call Melissa! As an experienced Home Renovator, I will not even bother with a house unless I expect to make at least 30%+ on my purchase....right off the bat. Often times, sellers think cheap fix-ups will do the trick to bring the home up to par with others in the area but that is really tricky. If the house is in bad shape, outdated and in need of the money to upgrade many items...it can be better to price it right and let it go!! Financing has become tougher for the flippers/house renovators....so you really have to weigh many factors....otherwise, the frustrated customer sits with a dilapidated home with no interested buyers. Staging would be pointless and really not worth it. (Lipstick on a pig....THAT is a description!) LOL...
Like you, I believe that as stagers, doing what is best for the customer is always the best policy. Though we all dislike turning away a job, there are reasons which warrant doing so. Nice story to share! Regards-Kathleen G
I've got nothing to add here, so may I just take this opportunity to wish you a very Merry Christmas, and a Happy, healthy New Year. You more than anyone in AR have enabled me to kick up my business a notch this year, and I am hugely grateful. Your newsletters post. It's made a major difference for me in scope, since I only market to realtors. I worry for you with all of your inventory, but know that you are fundamentally a savvy old biddy and unlikely to mis-step.
My very best to you,
Michelle,Mary,Madeleine, er, girlfriend!!Juliet
Juliet & Kathleen - FROG - term typically used in the east I believe.... Finished Room Over Garage... We don't have basements... we have FROGs.... though in this particular instance Kathleen's defination does actually work... lol....
Darn it....I was so sure about the FROG definition....hahaha....the description of that home sounded so like the ugly houses I pick up every so often to do a gut-job-rehab on and I usually describe things in such a manner...cookie-monster Blue shag with orange swirls....Brady-bunch paneling....Frog colored dank flooring....LOL!
Like Juliet...I often think of you and your massive inventory. Your business acumen is one to admire for sure and though I wonder if I will ever have the guts to take on even half your amount of inventory (big furniture), you are a continual inspiration Melissa!! Glad to know you are booked into mid-January!! Things are still slow in catching on here in SW Florida (lots of second homes for people living elsewhere)...and with the local rental company raising prices 60% (!!) during our 'season' (Nov-May), sometimes I wish I had more inventory to use....ugly furniture choices at a premium price makes me motivated to take the jump! Keep on it Melissa!! : ) Regards-Kathleen G
PS-I can't believe FROG.....though I am still chuckling about 'Lipstick on a pig'....that did it for me!! Hee-hee...
Melissa,
I would leave the house as is. The house will attract a different buyer in each siutation. If they leave as is, they will attract the investor. If they try to fix it up, it will be a buyer who wants to live there and will ask for any repairs for issues found in a home inspection.
Hi Melissa -
I am sitting in the exact situation you are on a house I was hired to do a consult on. Total 60's. I gave them the list, paint, wallpaper removal, light fixture upgrades, landscaping, etc. The homeowner was on board to do most of it but when the costs started coming in she hesitated. Now she is picking and choosing some items and leaving others, like a turquoise sink and pink countertop. My feeling is that either they do the renovations or they don't. It needs to be their decision. You can't do it half way or you won't be helping the overall feel. We'll see how it finally plays out. I think it is our job to give them the road map to getting it in decent shape for the market and they need to make the decision as to which way to go.
Kelly - I actually blogged about this home recently, see - Did my agent know something I didn't know about me? While I definately would have liked to see more changes take place, and it sounds like your situation is a bit more dramatic, in the end I did what the agent asked and definately feel the home shows to a completely different buyer in MLS now.
Of course the blue tiles in the bathroom still need to go, etc a buyer can at least imagine that they could make this a home. My lesson learned...... I hope it can help inspire you!