4. Home staging could be worth the extra cash.
“Besides new paint, staging is the best return on investment you can make,” said agent Rachel Valentino of Keller Williams. Particularly for vacant homes, she said, “It’s difficult for most buyers to walk into an empty house and see how their furniture would be placed. You have to do the legwork for them.”
With so many buyers searching online for properties, well-decorated rooms with visual impact are critical to standing out from the crowd. “If the photos look depressing, buyers may never walk inside the front door,” said Knull. Staging, he adds, is most valuable in properties with small or unusual spaces.
Professional stagers both rearrange owners’ furniture and redecorate from scratch, but their services don’t come cheap. A two-hour consultation with staging advice typically costs $200 to $300, and outfitting the main rooms with rented furnishings can cost $5,000 or more. “The national average to stage a vacant house is about 1 percent of the asking price,” said Monica Murphy, owner of Preferred Staging in Potomac Falls, Va.
5. Appraisals might not match price expectations.
The days of cherry-picking a friendly appraiser to assess a property within 24 hours are over. In 2009, a practice known as the Home Valuation Code of Conduct went into effect to ensure that homes are appraised fairly, without the influence of lenders and third parties. The policies are still in place for conforming mortgages sold to Fannie Mae and Freddie Mac, and they have created unintended consequences for appraisals.
Now lenders often outsource the process to third-party appraisal management companies to avoid any conflict of interest. Since the appraisal fee is now shared between the management firm and the appraiser, the appraisal can cost more, with the higher price passed on to buyers and sellers. “Not only is the consumer paying more but getting lower quality,” said Ken Chitester, spokesman of the Chicago-based Appraisal Institute. “Top appraisers won’t do the job for less than they used to be paid, and often the selected appraisers are the least experienced professionals available.”
In some cases, appraisers might undervalue the property because they are unfamiliar with the community in which the house is located. Realtor Kimberly Cestari of W.C. & A.N. Miller found one of her listings in Chevy Chase was appraised at $100,000 less than the sales price because it was a rambler in a neighborhood full of colonials. “I found a rambler of similar value in [the nearby neighborhood of] Forest Hills and the appraisal went up. It was a nail-biter,” Cestari said. “The onus is now on the listing agent to provide the appraiser with relevant comparables to show them how we arrived at the price.”
The seller can also help prove the value of the home. “Provide the appraiser with a list of repairs and upgrades to the home over the past four to five years,” said Frank John of Washington Appraisal.
More layers of administration and quality control between lenders and appraisers mean the appraisal process takes longer. “Generally, it takes seven to 10 days,” said McEnearney Associates’ Milligan. “Some lenders require two appraisals for some FHA and jumbo loans.”
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