Updating Electrical In a House, ranks up high on the list as updating plumbing. In 2010 HomeGain did a survey of 1000 agents throughout the United States, the survey revealed that 89% of agents nationwide agreed that updating electrical in a home could increase the homes value up to $1500.

Home buyers assume that it costs much more to fix broken items than it actually does. The perception of broken electrical out weighs the real repair costs in price reductions or low offers.

Mentally when a switch is turned on and doesn’t work the homebuyer will start calculating the cost of repairs, which in turn makes a reduction in the offering price. The reductions are almost far greater of the actual cost of the repair.

Should you have some broken switches and outlets, by all means replace them. Older homes that blow fuses are not only inconvenient but may be a safety issue as well.

For some odd reason items that I find often when providing home staging consultations are broken doorbell buttons, broken switch plates and burnt out light bulbs. Another item that has nothing to do with the working order of the electrical system are decorative switch plates, which I recommend being replaced with the good old average, boring switch plates.

Updating Electrical In a House Areas to consider would include:

1. An area that needs a three way switch, that can be turned on or off in two different areas
2. Add a switch for a light that is turned on by a cord
3. Add a switch for a fan that is turned on by a cord
4. Add a multi-purpose outlet for charging a mobile device
5. An area that could benefit from a dimmer switch
6. A home that has aluminum wire instead of copper (frequent cause of residential fire)
7. A home that has flickering lights or frequent blown fuses
8. A home that is older than 40 years old
9. A home that has a fuse box not a breaker system
10. Update electrical for Internet and other audio/visual equipment
11. Update original builder light fixtures
12. The greatest return on investment comes from additional lighting
13. Adding lighting to paths, patios and porches to accommodate outdoor living
14. Updating old flush mounted lights with new LED lighting
15. Dated light fixtures are an easy install that can modernize a home

If new homes and competing homes in the same price range have updated their electrical, to compete in the same price range you will have to make the necessary electrical updates or suffer the consequences of reduced offers or lingering on the market with price reductions.

Cost of Home Staging – Is Always Less Than First Price Reduction, price reductions run between $5000 and upwards. Many home staging tasks like cleaning and de cluttering are free and only require a bit of elbow grease. Good news, these improvements will return the largest return on investment. Other improvements will require an out of pocket investment but make a huge difference in how your home will appeal to homebuyers.

There is no set answer on how much to invest in the staging process it will depend on the condition of your home. A good rule of thumb is to expect to spend about 1%-3% of the value of your home on staging. You will invest considerably less If your home is in good repair and updated with the desires of a homebuyers heart. Whatever investment you make in effort or money, will easily add to your return on investment in the asking price.

When a home sits on the market a price reduction typically occurs. When you calculate the cost of the price reduction think in terms of the investment lost by not making the investment into home appeal upfront. Bare in mind that homebuyers will spend more money for a house that is move in ready. As I had mentioned in my previous posts, homebuyers want new and updated for the usual financial reasons.

According to the National Association of Realtors your best return on investment spent on home staging will occur between 1% and 3% of the asking price of your home. That upfront investment may get a larger return in thousands of dollars in equity when your home sells.

Remember when you are considering your budget, be creative in your thinking, you don’t always have to spend a lot of money to make your home appealing to homebuyers. Home staging allows you the flexibility to figure out inexpensive and creative solutions to cut costs of preparing your home for sale.

Visual home staging tricks for making spaces appear larger provide the perception of more space equalling more square footage and a bigger home. The perception of making your home feel newer, fresher and up to date will give homebuyers piece of mind that they won’t have to consider future investments.

Perception is everything, how you wrap your home up in a pretty little package and merchandise it to homebuyers. Think outside the box, use what you have differntly, borrow and be a bargain hunter to create lifestyle benefits that buyers are looking for. Yep, be prepared to spend some money for staging, but think of alternatives to get the job done.

The faster you sell the less likely you will have to reduce the price. Remember buyers want move in ready, your upfront investments will more than likely pay for itself by not having to reduce your asking price or accept lowball offers. Remember “you never get a second chance to make a first impression”.

When putting together your budget be mindful of what is critical and most important to your sale and what is optional. Some rooms are more important than others, those are the rooms you will want to put your investment of money and time into.

Recap:
The cost of home staging is less than your first price reduction
Expect to invest 1-3 percent to reap additional gains in you ur return on investment
Refer back to previous posts on cost vs value
Studies show the longer your home is on market it is more likely there will be price reductions.

Based on the research from National Association of Realtors, American Architects Association, House Logics Cost VS. Value Report, Contractors, Investors and homebuyer wants when purchasing, I’ve put together the return on investments statistics on where home improvements might be made if budget allows when selling your home.

When preparing your home for sale, home improvement projects will update the look of your house, and add value and make you money as well. When getting ready to make improvements, consider the 15% rule on home improvements—do not invest more than 15% of your home’s value into any home project. With this information under your belt, your home improvement project can be a great investment.

Some of the improvements you may be able to tackle yourself, others you may have to hire a professional. In order of priority, I’ll share where you will get your greatest return on investment.

1. 865% ROI is an easy update that can get done rather quickly. Replace burnt-out light bulbs and clean windows and skylights. Brightening and lightening your home is very cost effective and inexpensive.
2. 260%   Repairing and updating defective plumbing and electrical items, provides a large ROI. Paint and repair interior walls with a brand new fresh coat of paint. And patch those chips, holes, or cracks that you’ve been intending to fix for a couple of years. 148% ROI.
3. 251% Home Staging-Freshening a space with decor, art, greenery, lighting and staging furniture or renting furniture, livens a space for showings and marketing photos.  Consider hiring a staging consultant.
4. 148% Paint Interior-Repair any damaged interior walls by patching all chips, holes and cracks; then touch up or repaint interior walls with neutral color.
5. 104% If carpets are only soiled, have them professionally cleaned. Should they be thread bare, tattered and torn replace.
6. 101.8% Update entry door and jambs and replace with new 20-gauge steel unit, including clear dual-pane half-glass panel, jambs, and aluminum threshold with composite stop.
7. 101% Refinish your wood flooring and—with the addition of area rugs—give your home a brand new look.
8. 92/2% Adding manufactured stone veneer to foundations, arches, columns, around doors and windows
9. 90% ROI. Painting the exterior is a home improvement to enhance the property value of both your home and neighborhood, which makes everybody happy.
10. 88.4% Install new 4-section, uninsulated, single-layer, embossed steel garage door with galvanized steel hinges and nylon rollers, on new galvanized steel tracks; using existing motorized opener.
11. 80.7% Replace old, dated color, worn, dented or damaged siding with new vinyl siding, including all trim.
12. 80.5% Add a 16-by-20-foot deck using pressure-treated joists supported by 4×4 posts anchored to concrete piers. Install pressure-treated deck boards in a simple linear pattern. Include a built-in bench and planter of the same decking material. Include stairs, assuming three steps to grade. Provide a complete railing system using pressure-treated wood posts, railings, and balusters.
13. 80% ROI new windows have an ROI of over 80%
14. 79.3% Minor Kitchen Remodel- In a functional but dated 200-square-foot kitchen with 30 linear feet of cabinetry and countertops, leave cabinet boxes in place but replace fronts with new raised-panel wood doors and drawers, including new hardware. Replace wall oven and cooktop with new energy-efficient models. Replace laminate countertops; install midpriced sink and faucet. Repaint trim, add wall covering, and remove and replace resilient flooring.
15. 79.3% Finish the lower level of a house to create a 20-by-30-foot entertaining area with wet bar and a 5-by-8-foot full bathroom; construct 24 linear feet of finished partition to enclose mechanical area. Walls and ceilings are painted drywall throughout; exterior walls are insulated; painted trim throughout. Include five six-panel factory-painted hardboard doors with passage locksets. Electrical wiring to code.  (Bar area: Include 10 linear feet of raised-panel oak cabinets with laminate countertops, stainless steel bar sink, single-lever bar faucet, undercounter refrigerator, and vinyl floor tile.  Main room: Include 15 recessed ceiling light fixtures and three surface-mounted light fixtures, and a snap-together laminate flooring system.  Bathroom: Include standard white toilet, vanity with cultured marble top, resilient vinyl flooring, two-piece fiberglass shower unit, a light/fan combination, vanity light fixture, recessed medicine cabinet, towel and paper-holder hardware).
16.   77.6% Basement Remodel- Finish the lower level of a house to create a 20-by-30-foot entertaining area with wet bar and a 5-by-8-foot full bathroom; construct 24 linear feet of finished partition to enclose mechanical area. Walls and ceilings are painted drywall throughout; exterior walls are insulated; painted trim throughout. Include five six-panel factory-painted hardboard doors with passage locksets. Electrical wiring to code.  (Bar area: Include 10 linear feet of raised-panel oak cabinets with laminate countertops, stainless steel bar sink, single-lever bar faucet, undercounter refrigerator, and vinyl floor tile.  Main room: Include 15 recessed ceiling light fixtures and three surface-mounted light fixtures, and a snap-together laminate flooring system.  Bathroom: Include standard white toilet, vanity with cultured marble top, resilient vinyl flooring, two-piece fiberglass shower unit, a light/fan combination, vanity light fixture, recessed medicine cabinet, towel and paper-holder hardware).
17. 77.2% Attic Bedroom- Convert unfinished attic space to a 15-by-15-foot bedroom and a 5-by-7-foot bathroom with shower. Include a 15-foot shed dormer, four new windows, and closet space under the eaves. Insulate and finish ceiling and walls. Carpet floor. Extend existing HVAC to new space; provide electrical wiring and lighting to code. Retain existing stairs, but add rail and baluster around stairwell.
18. 74.3 Composite Deck- Add a 16-by-20-foot deck using pressure-treated joists supported by 4×4 posts anchored to concrete piers. Install composite deck material in a simple linear pattern. Include a built-in bench and planter of the same decking material. Include stairs, assuming three steps to grade. Provide a complete railing using a matching system made of the same composite as the decking material.
19. Major Kitchen Remodel- Update an outmoded 200-square-foot kitchen with a functional layout of 30 linear feet of semi-custom wood cabinets, including a 3-by-5-foot island; laminate countertops; and standard double-tub stainless-steel sink with standard single-lever faucet. Include energy-efficient wall oven, cooktop, ventilation system, built-in microwave, dishwasher, garbage disposal, and custom lighting. Add new resilient flooring. Finish with painted walls, trim, and ceiling.
20. 72.5% Update an existing 5-by-7-foot bathroom. Replace all fixtures to include 30-by-60-inch porcelain-on-steel tub with 4-by-4-inch ceramic tile surround; new single-lever temperature and pressure-balanced shower control; standard white toilet; solid-surface vanity counter with integral sink; recessed medicine cabinet with light; ceramic tile floor; vinyl wallpaper.
21. 71.8% Two-Story Addition-Add a first-floor family room and a second-floor bedroom with full bathroom in a 24-by-16-foot two-story wing over a crawlspace. Add new HVAC system to handle addition; electrical wiring to code.  (Family room: Include a prefabricated gas fireplace; 11 3-by-5-foot double-hung insulated clad-wood windows; an atrium-style exterior door; carpeted floors; painted drywall on walls and ceiling; and painted trim.  Bathroom: 5 by 8 feet. Include a one-piece fiberglass tub/shower unit; standard white toilet; wood vanity with solid-surface countertop; resilient vinyl flooring; and mirrored medicine cabinet with built-in light strip; papered walls; and painted trim; exhaust fan. Bedroom: Include walk-in closet/dressing area; carpet; painted walls, ceiling, and trim; general and spot lighting).
22. 70.8% Fibre Glass Entry Door Replacement- Remove existing 3-0/6-8 entry door and jambs and replace with new fiberglass unit with simulated wood grain, stained same color both sides; dual-pane, decorative half-glass panel with zinc caming; PVC-wrapped exterior trim in color to match existing trim; 2.5-inch interior colonial or ranch casings in hardwood stained to match door. Replace existing lockset with mortise lock with lever handle and integrated deadbolt in oil-rubbed bronze or satin-nickel finish.
23. 69.3% Garage Addition- Construct a 26-by-26-foot freestanding two-car garage, including footings and slab-on-grade foundation, 2×4 wood frame with OSB structural sheathing, and gable truss roof at 6/12 pitch. Install 25-year asphalt shingle roofing with galvanized metal flashing; vinyl siding and trim. Install five double-hung 30-by-48-inch vinyl windows; one 3-0/6-8 exterior door with half-glass and lockset; and two composite 9-by-8-foot overhead doors with motorized openers. Include 100-amp breaker at main house panel and 50 linear feet of trench buried conduit to feed new electrical subpanel. Provide electrical wiring for openers; three-way switching for fluorescent ceiling fixtures over each bay; three-way switching for two exterior spotlights; outlets to code. Interior wall, floors, and ceilings remain unfinished.
24. 67.6% Roof Replacement Remove existing roofing to bare wood sheathing and dispose of properly. Install 30 squares of 235-pound fiberglass asphalt shingles (min. 25-year warranty) with new felt underlayment, galvanized drip edge, and mill-finish aluminum flashing. Assume a 5-square hip roof; custom flashing at two average-sized skylights; and custom cap treatment at vented ridge.
25. 67.5% Master Suite Addition- Add a 24-by-16-foot master bedroom suite over a crawlspace. Include walk-in closet/dressing area, whirlpool tub in ceramic tile platform, separate 3-by-4-foot ceramic tile shower, and double-bowl vanity with solid-surface countertop. Bedroom floor is carpet; bathroom floor is ceramic tile. Painted walls, ceiling, and trim. General and spot lighting, exhaust fan; electrical wiring to code
26. 60.1% Bathroom Addition- Add a full 6-by-8-foot bathroom over a crawlspace with poured concrete walls. Include cultured-marble vanity top with molded sink; standard chrome faucets; 30-by-60-inch white fiberglass tub/shower with ceramic tile surround; single-lever temperature and pressure-balanced faucet; white low-profile toilet; general and spot lighting; electrical wiring to code; mirrored medicine cabinet; linen storage closet or cabinet; vinyl wallpaper; painted trim; and ceramic tile floor.
27. 28% Landscaping

Yesterdays post talked about your target market and what a typical homebuyer looks like. Today I’m going to cover what a typical seller looks like and how it will be important to you when you are getting ready to sell your home.

1. 40% of home sellers traded up to a larger sized home.
2. 47%  purchased a more expensive home.
3. 53% percent purchased a newer home.
4. The typical seller lived in their home for 10 years.

Remember yesterday I had mentiond that seller received 97 percent of the listing price, and 45 percent reported they reduced the initial asking price at least once.

With sellers moving up into a larger home, they are looking for more space, so it’s going to be really important to showcase your home by removing clutter and extra furniture pieces.

It is equally important to merchandise your home.  Visual merchandising is a retail strategy that maximizes the aesthetics of a product with the intent to increase sales.  Visual merchandising in this case home staging can also play a role in the look, feel and lifestyle benefits that a home provides.  Done well, it can create awareness in your marketing photos online presence while simultaneously increasing a home perceived value. Most importantly, it can draw homebuyers in and close the sale – all based on the aesthetic quality of your home.

In a nutshell those same sellers are home buyers, looking to move up into spacious homes, into more expensive and newer homes.  The goal of staging will be to paint the picture that your home can provide what homebuyers are looking for.

Success factors of home staging include the home’s appearance, updates, lighting, artwork, greenery, color, furniture, textures, presentation and the “wow” factor each of these elements bring together in a homes setting.  When these elements come together to showcase a home, it enriches the homebuyer experience, leading to a positive home buying experience and increased offers and faster sale.

Tomorrow in order of priority I’ll share how to stage your home, what updates will give you the best return on investment and how to merchandise the home for a wonderful “wow” factor.

I was asked to give a presentation at the Womens Council of Realtors North Metro Denver Chapter about home staging in January 2015. So, I might as well take this time to share a bit about what I’m going to talk about, before being handed the microphone.

Unfortunately, when I look at the statistics there is no easy way to sugar coat the facts, so I apologize now if this is hard hitting, but it is what it is and I do you a dis-service if I don’t give it to you plain and simple.

Being a bit of a statistic nut to make a case to the unbelieving to the home staging process, I thought it a good idea to to base my findings on statistics from National Home Builders Assn., National Assn. of Realtors and Remodeling Modeling Magazine Cost vs. Value Report, all of which spend lots and lots of money gathering data to determine what is going to provide a good return on investment.

It’s likely that this post will be in a few parts as there is quite a bit to cover, but I promise I’ll sum things up the best that I can in follow up posts. I’m going to talk about your homebuyer target market before getting to How To Give Home Buyers What They Really Want.  You can’t market a home for sale unless you know who you are selling to.

First and foremost home staging is used to appeal to the emotions of homebuyers. No matter how much furniture, artwork, greenery, lighting and accessories are used to prepare a home for sale, there are things that homebuyers are looking for and all the staging in the world will not make up for updates and repairs not done. Not following thru with updates and repairs will only help to sell the competition.

Home sellers armed with the knowledge of knowing who their target market is and how it will help give a marketing edge over the competition, will be the winner when it comes time to sell. Should you not take these considerations into account, your home will sit longer on the market, potentially receive price reductions, ultimately selling for less moola.

Across the nation it’s a sellers market, here in the Denver Metro area average days on market was 41 days (December 2014) so you are probably thinking “I don’t need to stage my home”, but I’ll cover some interesting stats that will change your mind. You can’t sell if you don’t know who you are selling to and what you are up against.

Let’s look at some statistics:

1. 33% of todays first time home buyers are 31 years of age and make an average income of $68,300. Repeat home buyers average age is 53 years old and earns approximately $95,000. 65% of these folks are married.

• What that means is you are going to have to stage your home to appeal to a broad target market. You can bet your bottom dollar that our younger homebuyers don’t want a dated, dingy home. The older buyers have made some money and are looking for something chic and stylish that reflects a certain lifestyle. Mauve, sage green, swags, wallpaper, just to name a few – gotta go. Remember, we are marketing for a higher return on investment when it comes time to sell our homes.  Well, that’s my goal for you when consulting

2.  New home purchasers bought a new home to avoid renovations or problems with plumbing or electrical, and the ability to customize their home.  Hint, hint.

• Hopefully you are making the needed repairs to your home, or if a Real Estate professional making the recommendations to your homesellers. Homebuyers want things looking like NEW. Otherwise, statistics say they want a better price and overall value, so be prepared for price reductions if you don’t give what the market demands.

3. 92 percent of home buyers use the internet in their home search.
   • You need to prepare and stage a home properly to appeal to buyers. I tell my clients when providing home staging consultations that the photos are the bait used to lure prospective buyers to visit your home. Make sure the visual distractions are kept to a minimum.

4. Typical home buyers searched for 10 weeks and viewed 10 homes
   • Homebuyers are discriminating. You have to capture their attention and may the best home win.

5. 53% of homebuyers purchased a newer home.
   • Let’s take a look at what that means: contemporary, the latest, modern, up-to-date, sophisticated, current, keeps with the pace. I hope this clarifies any questions you may have on what newer means, if not don’t worry that’s what you have a home stager with buyer eyes.

6. 48% reported credit card debt, that’s certainly a challenge to overcome.

7. 47% purchased a more expensive home.
8. 46% of homebuyers reported they have made some sacrifices such as reducing spending to purchase their home.
   • Don’t for a minute think that not painting or updating is an option, homebuyers don’t have the extra money to do it. They will spend more money on a move in ready house and sacrificed to do so.
9. 44% reported student loan debt (SMH/shaking my head)
10. 36% reported car loans delayed them from saving for a down payment.
11. 12% shared that saving for a down payment was the most difficult task in the home buying process.

Now that I have given you a snapshot of what your typical homebuyer looks like, hopefully you will have a better understanding of your target market when selling a home.

At the very least I hope that you can provide some empathy on why homebuyers shouldn’t expect to purchase what is as close to their dream home as possible.

They have overcome the obstacles of going to school, buying cars to get to work, sacrificed, paid off debt and have had to wait, to get to the point of being able to purchase a home, the American Dream. Your goal is to get your home for sale as close to new as you and your budget allow.

Updates, repairs and home staging will help you compete with NEW and updated homes in the same price range. Otherwise, be prepared for a below market value sales price, longer sale or price reductions.

Oh an before I forget, if you think that it’s a sellers market when the recent sellers who sold their homes were getting 97 percent of the listing price, and 45 percent of them reporting they reduced the initial asking price at least once, is good think again because you are leaving money on the table.

Staged and updated homes are being sold faster and for $10,000 and upwards more than ask price, with contingencies stating buyers would come out of pocket and not dependent on appraisal.  These same homes sell in days not the normal 41 that we are seeing.   So, these buyers mean business and have worked hard to get what they want and they will pay for what they want.

Tomorrow I’ll wrap up with talking about typical home sellers, which will be a real eye opener to your return on investment.

Life is fun and ever changing, but when it comes time to sell your home and updates need to be made, you may want to follow some bathroom trends do’s and don’ts to make sure you get a good return on investment.

Gray is here to stay! Gray was the “in” color choice for the bathroom in 2014, and it’s not going away anytime soon. Gray is a perfect neutral and versatile palette for traditional, modern/contemporary or transitional design. Darker grays are more dramatic and mysterious and the closer it gets to white, the more illuminating and lively it becomes (fyi buyers prefrer open light, bright and airy). Gray is not a 50/50 of white and black, gray can have tints of blue, green, pink, mauve or yellow within it which give it some energy. Adding white accents will give you a sophisticated look. Oh la la, add a splash of bold, eye-popping color, with accents and you’ve got the makins’ of delicious design.

Stick with transitional lighting, nothing trendy if you are updating to sell. Toss or donate original builder fixtures and add transitional lighting (also known as “updated classic”, “classic with a contemporary twist”, or “new takes on old classics”). Perfect for that “transitional” gray that can do double duty if you get bored, to go either with modern or classic design. Oh, don’t forget lighting in the shower and if you have some room an accent light on the counter or chandalier if you are sporting a big enough room.

FYI, traditional design is trailing behind contemporary, keep in mind the age group of the folks who will be buying your home (the average first time home buyer is 31).   Their tastes may be a wee bit different than what you are used to, if not among the same generation.

Home buyers are still looking for that spa like bathroom and Zen-like retreat that has earthy wood looking floors, tile made to look like wood is probably a smarter choice than the real deal in a particularly “wet” room. However, tile always has style especially if it is a good ceramic faux made to look like real natural stone or just plain real natural stone, there is nothing like it under a barefoot.

Interior designers are saying geometrics are in and I believe them. Me, the home stager says if I were you and getting ready to sell, I’d keep your geometric, bold colored tile to something more transitional and get your geometric trends on in your towels and/or accessories. Stay away from some of the trends that are more permanant when selling. Color and pattern do not appeal to the majorities, just saying.

DO:  Big showers, vanities with lots of drawers and technology, free standing soaking tubs,  water control like thermostatic mixers that can control multiple shower heads or a combination shower-bath. Benches or seats in showers, electric radiant floor heating, steam showers, no-threshold showers, comfort height toilets, comfort height vanities and while your at it, install one of the awesome USB ports to your electrical outlet for your smart phone.

Don’t forget to check out the National Association of Realtors Cost Vs. Value Report to see where you will get the best return on investment.