Want A Higher Price? Staging Pays a Big Premium!
I got a call from a man who said he wanted to sell his house in the southern part of San Francisco. He was a referral from a client of mine who worked at Oracle who had bought a house from me three years before. Like most sellers, this new client Benjamin Bratt (his last name has not been changed!) had an inflated idea of what his property was worth. He knew a house around the corner had sold for $850,000; however that house had been remodeled, had an apartment in the basement, the yard had been landscaped and it was on a much preferred street.
Benjamin was a bachelor who still had his college futon as a couch in his living room, a beer distiller in the dining room and a second bedroom filled with boxes of books and assorted items as if he had just moved in. (He had lived there 25 years). The kitchen had mismatched appliances including an avocado colored refrigerator. The yard was a dry patch of dying bushes and weeds and there was no bedspread on his bed or curtains on the windows.
Besides the frayed futon there was a nondescript wooden coffee table with a broken leg and a humongous television, topped by a metal box with protruding rabbit ears that reached half way up the wall,. This room reminded me of my years growing up in the sixties. I clearly had a big job ahead of me: first getting Benjamin realistic about pricing, and next– getting his house ready for sale.
On my second visit I came with a comprehensive market analysis showing houses currently for sale, ones sold in the past six months, ones expired and those languishing on the market. While I reviewed each property with him I emphasized the importance of presenting a property for sale in the right way, explaining further that the higher priced properties had more amenities and were in better condition. I left the package with him – hoping he would go over it in more detail on his own time.
Before I left, I suggested that if he wanted a higher price (and all Sellers do) he should consider a stager/interior decorator to help him present the home. “I will work with them, of course, to keep down the costs. This was not a million dollar home so I can pick someone who is willing work per hour and will use whatever furnishings they can and also help you buy some badly needed furniture. And remember a coat of paint, which is not costly, can transform a home.”
I knew the perfect person, one who was trying to make a go in this business. Sandy had called me in recent months, begging me for some of my business. I left the prodigious market analysis with Benjamin hoping he would sift through the detailed information on his own time and become more objective on price.
After a few days I was ready to follow up with the Staging Call: “Sandy is available to swing by either Wednesday or Thursday. What works for you?” I asked, assuming he would agree—which he did.
We were now on Part Two of my listing strategy. Sandy was soft-spoken and thoughtful as she went through the house, giving Benjamin plenty of time to take in all her suggestions. The meeting took two and a half hours. At its conclusion Benjamin was convinced he needed both Sandy’s and my help to get his higher price. When I mentioned my company would front the money he needed to prepare his house for sale, he lit up like a Christmas tree—understanding that once his home sold, he would reimburse us the money. This was a great deal for him as it was a perk not all real estate firms offered. However, Benjamin did negotiate the commission from a 6% to a 5% which most Sellers were doing in this hot San Francisco Sellers’ market. I agreed because a real estate listing was a sure sale these days. An agent could work months with a buyer and never get a sale.
At the same time I also knew there would be a lot of work ahead of me, but as soon as he agreed on a realistic selling price, I brought out the listing papers for him to sign. I knew that a realistic sale price is the most important part of negotiating. A 6% commission on a home that won’t sell doesn’t increase my income one iota—remember we real estate agents only get paid when a property sells.
Stay tuned as more happens with this interesting client, as there will be more lessons to be learned.