Cole House Design Blog

Wow - that's interesting!  Do they give the Staging fees back if the house doesn't sell? I wonder what constitutes as sold - accepted offer before midnight on the 30th day? 

There are too many factors outside of Staging that affect how quickly a home sells - price being the biggest. I do not offer any specific time guarantees.

Nicole - You know, I was thinking about this the other day.  With the explosion of home stagers over the last few years (seems everywhere I turn I meet one), staging is a hot topic.  And there are a lot of stats thrown at agents and sellers regrading the effectiveness of staging.  Of course all those stats seem worthless to me, because no stager is willing to put their money where their mouth is on this.  Now, of course, I agree with you that there are other variables to take into consideration (overpriced home would kill all your efforts), but I do think the staging world needs some sort of guarantee.  Maybe it revolves around my experience when I met one stager who was adamant about her skill, but when questioned about what happens if it doesn't work and doesn't help the home sell, she got very defensive.  It just came off as if she was saying "I know my skills will sell your home...but if they don't...its not my fault, it must be yours."  While this may be true, there seems to be no way to quantify what stagers do and the true effects it will have on this particular home.  So if the world had some sort of guarantee it might help.  You might lose some here and there, but it might build some solid trust in the services you provide...know what I mean?

So you know, I am not against home staging, I'm just thinking out loud here and will be curious to see what you think.

A lot of businesses offer guarantees but have stipulations. Perhaps the fine print states that if their home doesn't sell in 30 days, the company will rebate $50. Guarantees are just marketing ploys and I doubt they will offer anything substantial if the home doesn't sell in less than 30 days. It probably does get them business though.

Aloha Nicole,

All the power to them. If they are still in business in 6 months with their guarantee intact I would be impressed. As good as it sounds I would guess there are stipulations regarding the pricing of the home, whether recommendations are followed to a T, etc. There are many variables beyond the control of the Stager that makes this a poor business choice for stagers.

Peace,

Hi Nicole, I totally I agree with you. There are other variables that affect how long it takes to sell a home. The home could be staged beautifully, and be in undesirable location or be priced incorrectly.

By guaranteeing that the home will sell, you are taking responsibilty for all of the other factors that could cause it to sit on the market. You then run the risk of losing alot of money and time for something that was out of your control.

It takes more than just making a home look nice to get it sold. Guaranteeing that Staging will get the home sold in 30 days could be the same thing as a realtor guaranteeing it will sell in 30 days. In the Real Estate market, there are no guarantees!

Home Staging does make the odds of it selling quickly a heck of a lot better though!!! lol :)

Cheers, Nicole!

If I was in complete control of price, condition and marketing of the house then I would be more apt to offer a guarantee. But since I'm not, I can only make the house show it's best. That is my job. That alone will not sell a house. I think people need to understand that staging is not a guarantee to sell but it is a market differentiator that will set it apart from other houses in it's price range. If it's overpriced, then it really isn't competing apples to apples and buyers will see that. I've staged homes that sat on the market - they were either priced too high or didn't get marketed well (not even on the MLS). These things are out of my control so no, I would not be offering a guarantee it will sell in a certain amount of time. I could guarantee that my clients will be happy with the job I've done for them though.

I would like to respond to the Realtor who responded to your inquiry. First, thank you for your input, all opinions are valuable.

But I want to explain that most home stagers put thousands of dollars worth of furniture and other items in to staged houses. We have to pay for those items somehow, before we make any kind of profit.

Our overhead is very high, with furniture, accessories, artwork, kitchen and bath items, storage units, trucks, "moving men", and many other business expenses.

If I have inventory that is in a house, and am then expected to reimburse all of my fees to the homeowner if it doesn't sell, then I lose money that I have invested. Realtors have set up their fee structures differently; they are on commission, and are only paid if the house sells. Thus, they are not making any guarantees, either. I don't know of any Realtors who would make thousands of dollars on a sale, but who would offer to pay out of their pocket that fee back to the homeowner, if the house doesn't sell. See the difference?

We have moved in this direction, with the offer of a "if you don't sell, you don't pay" with regard to our staging fees. However, that particular offer is only valid if we are in complete control of the staging and the seller does not interfere in the creative process or alter the results. We have a separate contract for this and it is obviously very controlled, even with regard to covering pricing and marketing.

A seller cannot expect miracles or guarantees only implementing a few selections from a stager's suggestions. To reap the rewards of staging, you really have to trust your stager implicitly to understand the area market, run the comps, investigate the demographics, and prepare the property accordingly.

It would be a great thing if we could always offer such a guarantee, but it's just not that easy. Sellers decline to follow some advice, for reasons of their own. You cannot guarantee a faster sale and more equity for these sellers. But the ones that do beleive in our skill, and are willing to implement all suggestions in accordance with an iron-clad contract, do indeed have a guarantee with our company. However, we also reserve the right to turn a house down that just has to many issues such as location.

But I could never give a number, like 30 days. That is ludicrous, in any market, not just the resent climate. I do not see how anyone could do business like that for long. One cannot offer that assurance and still stay in the black over the course of time, in my opinion.

~Michelle

~Michelle

When the agents start offering guarantees perhaps I will CONSIDER it.  Until then it's cost prohibitive for the investment that I make in each staging.  It is interesting but not logical. 

I think Matt raised a very valid point when he discusses the fact that it is hard to quantify exactly how staging (as well as other marketing techniques) increased the sale price on any particular home.  It's a question that comes up when I suggest staging for a listing, the seller wants to know what their return on investment is going to be.   That information can be discussed in general terms and for some clients, that's enough but for others without a specific number they wont bother.

Peg - I think you do, but please understand (I want to be very clear on this), I am not against staging.  I also understand the work (and investments in time and money) that you put into a home.  That isn't questioned in the least (on my part).  I think I just see too much "use a stager and your home will sell x times faster than the average home."  Because the effects on any particular home are hard to quantify, it makes it harder to justify the expense (especially to a seller who is looking hard at their bottom line).  Of course, I see the correlation between stagers and agents.  There's a lot of the same kind of "I'll sell this house quicker and for more money" thinking going on with both of us.  You for the appeal of the home, us for the pricing and marketing of a home.  Using both can be a definite benefit, no doubt there.  I was just thinking out loud that perhaps if there was some way to use a guarantee, staging might become a bigger business than it already is.  If clients knew they were getting someone to put their money where their mouth is, then they might be more willing to give up complete control (as mentioned by Michelle above and their use of guarantees).  In our case, I can see the need for the same sort of guarantees (although I don't imagine they would ever be welcomed by the Realtor public, much as I wouldn't expect it to be welcomed by stagers).  Although we don't give them, we do put up money that may never be recouped.  The marketing budget for any given home is paid for by us never to be recouped if we don't sell the home or the seller cancels, withdraws, or moves to another agent for the listing.  It can be costly in some instances.  Some agents have moved to a transaction fee system, where they collect x amount up front to do their marketing, then when the house sells, its figured into the commission - if it doesn't sell the agent isn't losing their shirt.  I for one am not a big fan of the transaction fee.

Overall, I was just curious to see what some stagers thought and I must say, I'm thrilled that someone commented on my comment (other than just Nicole - I'm a big fan of people commenting on comments as I think its great for dialog and idea building).

Ginger - You say its interesting, but not logical.  Do you think there are ways to make it logical?  Do you think its a viable business model?  I would think that many clients would be very interested in someone quanitiying what they do and making it possible to see a defined result.  As I said to Peg above, I can see the same being said for agents, so please don't mistake my line of questioning for any doubts about the industry.

Julie - I think you just summed up my thoughts with a lot less words.  Its hard to explain to someone who wants to see the numbers and the results - they want to know the exact value of staging.  For me, I'd love to see every property staged...I can see the difference on a buyer's face when they look at a staged home.

Thanks back at Matt for his reply. We are always interested in what Realtors have to say about our industry. (See my post a week or so ago about this issue.) I am relieved that you support staging, as I support hiring a Realtor (vs FSBO). Not because there is a guarantee, but I believe that in any market, a home seller needs to have professionals on their side to help them, advise them, and guide them through the process. We are a sellers biggest fan, and give a shout out for joy when one of our staged homes sells! And Nicole, I love the "guarantee" that you give; it is realistic and optimistic at the same time!

Great post!  My staging agreement states I do not guarantee my staging will result in the sale of their home-but I do.....and I list the value of investing in staging and what my company gives my clients...ie high quality accessories, matching lamps and end tables, luxury bedding and pillows..etc.    Nicole-you are my kind of professional!!

Hi Nicole,

I've ever only heard of the word "guarantee" applied to home staging by Haverhill.  I've linked to one of their website pages, where they explain their version of a Home Selling Guarantee.  Unless I'm wrong in my comprehension, their 'guarantee' only applies to properties which were staged by them, underwent a market evaluation process and sold within 90 days.

Unsold properties do not qualify for refunds of the staging services paid...very strange way to set up a 'guarantee.'  I would interpret this to mean they only guarantee getting the selling price, not actually getting it sold!  If they don't offer a guarantee on getting it sold, what is their 'guarantee' actually worth?

Back to the topic at hand - How can we guarantee something when so many other factors affect the outcome?  People buy homes based on emotion (for the most part).  No two people are the same.  No two houses are the same.

Today I went to follow up on a staging consultation where I had given the seller a detailed "to do" list -- so their dated home would be more desirable and show well.  Well, the "after" shots, look like "before" shots to me -- they thought it looked wonderful. I was irritated that they thought someone would love their dated lighting in the kitchen and 35 year old woven shades, gaudy paint colors (and much more). . . I have a guarantee for this house . . .

it won't sell in 30 days and they won't get their price either!

Realtors can't guarantee a sale even if a home is well priced . . . while stagers can guarantee professional quality results, it is just one ingredient of selling a home.

Matt, having done this business for many years I have considered many different methods of working with agents to get a house SOLD.  Afterall that's my ultimate goal in all of my staging work.  This discussion has also been through the mill more than once here in Stage it Forward and usually the result is...we (stagers) don't have control of much of the sales and marketing process so we can't guarantee results.  Some stagers believe that if we collected a percentage of the sales price, then they would consider it.  Of course then, as with agents, there would be a chance of lossing it all for many reasons.  

Actually my financial advisor believes that I should get a percentage AND offer a guarantee, BUT he's seen my work and believes 100% in what I do.  However, he doesn't totally understand the nuiances of the team work that would have to be involved.  So perhaps the answer is in creating a VERY strong, cohesive, communicative, trusting team with all parties (agents, sellers & stagers) committed to making the house the best it can be in condition, pricing and marketing. 

BTW I never thought that you were AGAINST our industry and I appreciate the conversation.  It's never bad to get the brain thinking of new ways to get it done AND I think that I can safely say that most of here in Stage It Forward LOVE hearing from Realtors.  Thanks.

Woweee! What a debate. I do not give a guarantee. Same as others pointed out, I don't have full control over price and marketing. Because we rarely have two homes side by side, exactly the same, one staged and one not, it is a little tough to quantify exactly the value of staging. Those statistics that are given are based on averages, and they are valid. Statistics help you when looking at "likelihood" for a group, but are not a guarantee that a specific outcome will happen in every instance.

It's just not possible to give any guarantee.  I've had homes that have been beautifully staged, well marketed and priced right but if the homeowner insists on holding out for more there's not a whole lot I can do about it.  I know our statistics show that staged homes generally sell faster and for more money but it is a really hard thing to qualify.  I don't quote those statistics myself.  Rather, I try to educate people that in order to sell their largest investment they had better be ready to put a little money into preparing it for sale.  What I do quote is "you only have one chance to make a first impression".  No one can deny that point.  The home stager that can really guarantee a home will be sold in 30 days is going to be one very successful stager, or one that's out of business in three months!

I agree that giving a guarantee would not work.  One house I staged would not sell and after a short talk to the agent who had recieved complaints from the home owner on the time it was taking to sell we decided to go in an check the house, we found dog hair all over the carpet, and a shopping bag of garbage hanging on the outside of one of the kitchen cabinets, the smell was not pleasant. The owner had a tennant who really did not like the idea of finding new accommodation, so they were refusing help keep the house clean, actually stuck chewing gum on the dresser for all to see, and as he left after the owner every morning he left wet towels all over the floor, and ensured that the bag of wet garbage was hung up in the kitchen.

How can you guarantee something that is out of your control?

Unfortunately companies who offer guarantees that home owners have little or no chance of ever recouping simply bring the whole profession down. It is a major problem in an unregulated market.

Donna Plant

Home Staging by Streamline H. S. Ltd.

Remember PERCEPTION OF VALUE CHANGES WITH PRESENTATION

Wow, I'm really excited by all the talk on this one.  Thanks to everyone who chimed in and let me see what's going on in the stager's world.  Ginger's thoughts quoted below intrigued me and I wanted to put them in here to discuss further:

Actually my financial advisor believes that I should get a percentage AND offer a guarantee, BUT he's seen my work and believes 100% in what I do.  However, he doesn't totally understand the nuiances of the team work that would have to be involved.  So perhaps the answer is in creating a VERY strong, cohesive, communicative, trusting team with all parties (agents, sellers & stagers) committed to making the house the best it can be in condition, pricing and marketing.

Perhaps there is a possible solution in there.  Percentages with guarantees and a team of professionals working together to get the job done right.  Agents often create teams (one agent does buying, one agent does selling) - where the money is pooled and split.  Perhaps there is a possible business model in that.  I know that one of the obstacles of getting someone to stage their home is the cost.  What if a team effort was struck between Realtors and stagers and instead of just charging x% for commission, the agent's team was charging x+y%.  The team makes the listing presentation with the agent doing the "numbers" and the stager doing the "aesthetics" - a combined presentation that then showcase both skill sets and the value that justifies the higher commission rate.  We all get paid at closing (agents and stagers) instead of any up front fees.  The stagers could potentially make more money this way and have a vested interest in doing their best and giving it their all (not implying that you don't, but commission based sales always help push people to do their best I think).  The stagers also share in the responsibility if the home doesn't sell (ie, no paycheck), so it gets the agents and stagers talking, thinking, marketing, and overall doing whatever it takes to get that property sold for their clients.

What kind of additional % do you think it would take to a) satisfy the stager's need to recoup and profit and b) keep the costs to a point that a seller would think its valuable and worth the extra percentage?  I am not trying to say there's a set way to do it, but since I am not a stager, I don't know or understand fully the expenses and business side of your work.  So I'm curious to see what kind of % stagers think would be suitable if a business model like this were to be applied.

Hi Matt -

Thanks for your input on this. It is nice to hear a Realtor's perspective. What I have offered to my preferred Realtors recently is to accept payment at close of escrow. Maybe getting a little up front just to cover my outlay of expenses, rental of the truck and paying my assistant and then collecting the rest at close. I would have to agree once I saw the property however. I have done this before and got stung because the homeowner promised to finish some projects that he never did and the house felt unfinished. I would probably just give a rate at close of escrow as opposed to a percentage. Each job is different and I would want enough to cover the costs on that particular job plus I would charge a little extra than I would had I got payment up front. I would just put it in the contract that I would collect $? at close of escrow with possibly $200-$300 upfront if it was a vacant to cover some hard costs. How would that sound to you as a Realtor?

Nicole,

You've really hit an "emotional" hot button for everyone.  I never offer a guarantee but I do back up my assertion that my staged homes sell faster than unstaged home in our local market by listing my staged properties and days on market.  For most buyers, this gives them enough comfort to use my services. 

I am experimenting with offering builders to stage their quick delivery homes on commission (same structure as a Realtor).  I'm charging a premium of 1-2% of selling price for my staging services, payable when the home is sold.  Prior to staging the home, the builder pays for upfront costs, such as furniture and accessory rentals.  This way, I don't have any out-of-pocket costs but do have highly profitable but deferred income.  I'm only offering this to a small group of builders to see if it works for me.   I've recently done 1 quick delivery home with this structure so I'll see whether it brings me more profitable business. 

As business owners, we have to think of innovative ways to gain customers and grow our business.

Kelly - I like your idea and I think it would encourage more sellers to use staging services.  I think one of the greatest obstacles to staging is the upfront costs.  Even if the pay now or pay at close costs are exactly the same, the perception is better for the pay at close.  Much like if I asked every seller to pay me up front.  Once you "see" the money going out of your hands the perception of it changes.  Its much like the difference in paying taxes out of your paycheck or paying them all at once (or quarterly).  Its a lot easy to swallow if the money never hits your hands.

I have done this before and got stung because the homeowner promised to finish some projects that he never did and the house felt unfinished.

Agents can certainly share your pain on this one.  Imagine doing your marketing, investing in signs, advertising, your time, various other expenses that come up in the course of a listing and you lose the listing or head over the home to see the client and its a mess (and therefore wouldn't sell).  I think that's what I was getting at when I started my comment thread...there is a risk associated with listings and perhaps (this is part of what I wanted opinions on) if stagers were assuming some of that risk, it would make it easier for sellers to pay for their services.  I think if we as agents guaranteed our commission whether we sold the house or not, we'd certainly see a lot more for sale by owner than we already do.

Deb - Your last line says it all to me.  I was hoping to bring some innovative discussion to this post and sort of pick the brains of the experts on staging.  Since I'm not a stager, its hard for me to formulate a business model for you, but I thought maybe if we had a discussion about it, it might spark something and we could all benefit.

I can see how your builder offer could work great.  I just sold a builder's inventory home this week and with a bit of furnishings and some decor, it probably could have sold for much more.  It had a lot of open space, which I know can appear to be "too much" without the proper arrangement of furniture.

Thanks to everyone participating in the discussion...I am enjoying it tremendously and I hope some good things come from it (both for me and for you).

Jumping back in!

Matt, I think you hit the nail on the head when you commented about the homeowners who let their house be in a "mess" when it's on the market.

Professional Stagers that I know give it their ALL when staging, but if the homeowner still isn't on board, and lets the house go to "heck" again, then they should be the ones to "suffer the (financial) consequences", not the stager, if the house doesn't sell.

In an occupied staged home we just simply can't control the look of the house once we leave; and if some time goes by and the house doesn't sell, then the homeowner may want to blame the staging, when in fact it wasn't anything the stager did wrong. I think the homeowners should "assume the risk".

Also, many homes are going into foreclosure (which makes me sick for those people)...so if we stage a house, and the homeowner doesn't make their payments, and the house goes into foreclosure, then the stager would be one more business that is left hanging. 

Okay, I'll leave it alone now! Lots of good things to think about.

One last thing! Realtors set up their commission based fees decades ago, and I see why they did it, but most other businesses simply can't stay afloat with that type of pay structure.

That's a risky thing to put on a contract.  Like you said, if other things are not in play, you can't guarantee it.  It the price is too high, or the Realtor doesn't put great photos online, or market the home correctly to bring traffic to the home, you really can't guarantee anything.  I can't afford to put that in my contract, but like you, I guarantee excellent customer service, competative prices, and 110% effort into staging their home and maximizing the visual and emotional appeal of each space to the best we can.  Great post, thanks for sharing.

Some home stagers can't even guarnantee they'll be in business in 6 months, much less that a house will sell.

I always say it is a guranatee that your house will show better.

Agree with Cindy, we can guarantee the house will show better.

Whether it sells or not (and when) is based on many factors the stager has zero control over. As such, providing any such guarantee doesn't make sense in my opinion.

I'm glad I stumbled across this discussion as the time it takes homes to sell and price to stage remains a sensitive issue when selling staging services. I recently had an agent ask me  "Do you offer any plans with a low deposit up front and payments at closing?"

He was asking on behalf of a development he is representing. I responded by saying that since most of the expense of staging is furniture and accessories, carrying those costs until a unit closes is not a good value proposition for me.

When I had originally been contacted on behalf of this developer they had been given quotes in excess of $20K from interior design firms to design and furnish a model unit. The cost to use my company to stage it is a fraction of that and yet they should still reap the same reward. Attracting more motivated buyers who appreciate the value of seeing the unit furnished and attractively staged!