Seven Tips to Protect Your Commission When Recommending Home Staging Services

By Jennie Norris, ASPM®, IAHSP®, Chairwoman, International Association of Home Staging Professionals®, President & CEO of Stagedhomes.com, and Owner of Sensational Home Staging – We Stage Colorado


Real estate agents are always looking for ways to differentiate themselves from their competition. Some Agents invest their own dollars to prepare and market properties, paying for services on behalf of their seller to ensure the house is ready for buyers to see prior to hitting the market. One of the key value-added services is home staging. Statistics provided by both The Profile of Home Staging (NAR®) and The 2020 Home Staging Industry Report (IAHSP®) both share staged houses sell for up to 20% more than the non-staged competition. Sellers need to make sure their house is show ready and throughout the years, the home staging industry members have seen a steady increase in the number of agents providing this as part of the marketing services to prepare and successfully sell a property. 

Realtors hire a professional home stager to provide a staging consultation for the sellers where they receive detailed information on what to do room by room to prepare their house for sale. A consultation costs about $250-$500 around the country and agents consider it part of their marketing strategy and pay for it on behalf of the seller. When compared to other services agents will often pay for to prepare and sell the house, such as carpet cleaning, window cleaning, professional house cleaning, landscape clean up, photography and virtual tours, staging is a the only service done in preparation of the house for sale that bring measurable value proven by the statistical surveys conducted by NAR® and IAHSP®. 

But what happens if the property needs more than a consultation? Many houses need the addition of furniture and décor brought into empty rooms in a house or added to supplement homeowner’s items to fill the gaps and provide a more updated look for buyers. Sellers may not have the available cash flow to pay for professional staging, so agents are offering to pay for the hands-on staging and inventory fees because they know the staging will help the house sell faster and at the best price. It is a win-win for the agent-seller team. 

The challenge is the market can be unpredictable. A Realtor is not in charge of the market and cannot guarantee a house will sell in a certain timeframe, although they approach every listing with the strategy of getting the house under contract quickly. There are external factors that impact the market including interest rates, the economy and other properties that are for sale. When a REALTOR® offers to pay for staging services, they need to make sure to protect their commission and offer creative solutions to their sellers. 

Here are seven tips to keep in mind when incorporating home staging into your listing process and protect your commission: 

1. Get an estimate for the staging BEFORE you establish your commission

The Staging should be an add-on service that is covered by the commission. If you don’t get a price first and then agree to lower your commission in order to secure a listing, you are now receiving less money for the sale. Most agents who incorporate this strategy of paying for staging use the staging as a way to validate being paid MORE than another agent who is not bringing staging to the table. Depending on what pricing you received from the stager, you would increase your commission percentage by 0.25 or 0.5% to pay for the initial Staging and could increase by 1% or more if the house is luxury property. In most markets, this small increase in commission earned will cover the initial Staging investment.  Contact your stager to get a price for staging the main rooms of the house and use that as a guideline when negotiating your commission. 

2. Do not pressure your stager for “the price” to stage when they have not seen the property yet. 

You want to know what the costs will be to determine how you will structure your commission but a stager usually needs to see the house to provide you with accurate pricing and this is ideally done in person but can also be done using photos. An experienced stager can give a price “range” – but even with that it could be inaccurate when they have not really seen the house. Some stagers provide pricing based on list price, square footage or number of rooms being staged, and with this type of pricing, you need to ensure you are getting the appropriate style, volume of furnishings, and quality that is appropriate for the type of property you are listing.  When an agent does not get an accurate estimate, they risk their commission because they do not own the staging business and do not know how a stager prices their services. When the Stager provides the estimate, the listing agent can be in a tough position because they agreed to pay for services that are more than planned. This means the Staging could be scaled back, or the agent has to pay more than planned. Getting the estimate UP FRONT before negotiating commission ensures agents do not end up getting less than they deserve for selling the house.

3. Make sure to cap the amount you are contributing toward the Staging. 

If furniture and décor are provided, there can be an ongoing fee paid for inventory supply or rental. The items ideally need to stay in place until the house is under contract and it is safe to remove. This could be in a month or it could be several months after the initial staging, and when an agent does not cap the amount they are contributing, the ongoing inventory use fee is added to the amount paid by the agent, which means you are making less and less commission. You are not able to re-negotiate your commission at this point, and so the ongoing fees are coming out of your earnings. This could add up to thousands of dollars, and when the seller is benefitting the most from the sale, they need to be the ones paying for the ongoing staging investment. 

4. Share what, if anything, you are willing to pay toward the staging and put it in writing. 

What we recommend is you share with the seller, “I will contribute up to $___ towards the Staging, and then any fees beyond that will be your responsibility.” If the seller is not able to pay up front, you can share, “I will cover the costs associated with the initial staging and will be reimbursed at the successful close.” There is a risk involved as the client could decide to cancel the listing. Make sure to protect your money in the agreement sharing, “If for any reason the house is removed from active listing or other changes occur (you) will be paid in full for the Staging investment paid on behalf of (client).” 

When you are willing to pay a portion of the staging, ideally have the seller pay up front and you reimburse them at the successful close for what you want to contribute. “I will pay $___ towards the staging cost and it will be paid to you at the successful close of the sale.” That is the ideal scenario as you are not having to come out of pocket for any of the staging service, and if anything happens to the client or sale, you are not risking leaving money behind. If you just want to provide a consultation, you would share, “I pay for the services of a professional staging consultation where you will receive detailed recommendations on what to do to prepare your house for sale. Any additional staging services would be paid by you.” Always make sure the terms are in writing in your contract and clearly understood by the homeowners. 

5. Do not quote pricing for the staging unless you received pricing from your stager. 

Your clients may ask what the staging will cost, and if you have not received proposals and pricing for staging, please do not guess at what you think it should be. You may end up setting false expectations for the sellers, and the pricing could be way off – either too low or too high. There are other factors to consider with the staging, and it is best to put the emphasis on the results they want versus putting the focus on the price. Lastly, let the Stager negotiate any price adjustments and be the one to explain the services and how they work. One key point to share is, “The investment in Staging is always less than a price reduction or a lower starting price.” And Staging is a tax write deduction (IRS Publication 523) and a price reduction or lower starting price is a loss of equity. 

6. Always quantify the value of any services you are paying for on behalf of the Seller so they understand upfront your commitment and contribution to help them sell their property. 

When a person gets things for free, it is human nature to not really assign any value to the service or item and a nonchalant attitude seems to prevail. Let them know you are investing in the sale of their house – give them the value – and reinforce your quality reputation and standards. This applies for staging and any other preparation services such as cleaning, carpet cleaning, window washing, landscape touch up, photography and virtual tours. When there is no value, there is no appreciation or understanding of the benefits you are providing versus other agents. 

7. Be creative with options for staging and needed home improvements and connect with companies that provide this service. 

There are companies, such as ZoomCasa,that will pay for any improvements needed for a property and require the house to be staged. They pay for all the services up front and get reimbursed with an added fee for loaning the funds. They evaluate the property, make sure there is enough equity or margin in the sale to cover all the closing costs, agent commissions, their fees, and provide all the financial resources for whatever work needs to be done prior to listing. Your professional stager will be vetted by them in advance and can share the names and contacts for the company. This option helps protect and preserve your and your sellers’ money as you are not having to put out any up front for the prep and staging of the property. If you decide to contribute a portion toward the staging, you can put that in your contract and have it paid at closing. One of the great aspects of this program is the companies providing the services to repair, remodel, improve and stage the house are paid when they do the work and do not have to wait for the house to close. You won’t have to ask anyone to wait to be paid, which can be a hardship for these affiliate companies. 

Use these 7 Tips to help you protect your income while being seen as a Realtor that does more for your sellers than the average agent.  Staging adds value to the sale and it should not break your bank.

Want to know the 2020 Statistics for Home Staging?

Go to www.HomeStagingStats.com and download our 34 page report with statistics on vacant, occupied, regular priced, and luxury priced properties, plus infographics on the process for consultations to help you better educate your clients.


About the author: Jennie Norris has been staging professionally since 2002, and to date she has Staged over 5,400 properties. She has yet to meet a house she could not help and she stages all properties from modest to multi-million dollar. Jennie runs the world’s largest home staging industry trade association, and the largest real estate home staging training company. She is passionate about the industry she serves and is committed to helping partner in education with real estate agents, sellers, builders and investors. Jennie resides in Littleton, CO with her family.

RIGHT and WRONG – Is Staging really that Black and White?

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By Jennie Norris, IAHSP Chairwoman

There are numerous groups on social media where idea sharing takes place to help provide guidance or tips to industry colleagues.  One of the more common questions or posts I see are from newer Stagers posting pics of properties they are going to Stage or have Staged, asking if what they did is “right.”  The answer to what all stagers need in order to stage a house in the best way is at the end of this article.  This leads me to the question, is there one “right” way to Stage® a room?  Are there a lot of rules that if you violate them, your staging is “wrong” and the house now will not sell? 

In short. No. 

Staging is subjective.  It always has been and always will be.  We need to be careful about boxing in our creativity and assigning one set of rules to every staging. Not only is that restrictive, it is unrealistic.  Things like budget, timeframe, and resources are all factors in how a property is Staged.  It is important we do not compare our staging to someone else’s or judge a staging that may not be as embellished as others because what is not being openly shared is how much of a budget the stager had to carry out the staging.  Of course, someone who has a large budget can provide more than one that has a tighter budget, and the question we SHOULD be asking is, “Did the house sell?” When that answer is, “Yes,” the staging worked, the stager did a great job, and the client got the results they wanted.  Of course, please never stage a house with too few things as it cheapens not only the buyer experience, the house, but our industry.  Better to walk away from a client with too small a budget than diminish your reputation and staging integrity.

If a house is occupied and being Staged using what the homeowner has that is very different than a vacant property where the Stager gets to select all the furnishing and décor to create a look that fits the property and the budget provided.  And when the homeowner is still living in the house, there is the added challenge of maintaining the look of the staging with an owner who is less-than-attentive to detail.

How often does PRICE factor into a Staging?  Every time.  It’s pretty rare that a Stager gets carte blanche for a Staging to charge whatever they want to for their services.  I never have. Eighteen years and 5,400 properties and counting and I have never had a client tell me to spend whatever I wanted to get their house ready for sale.  There is always a budget to consider, and more generous budgets allow for more items and more profit to the stager. The tighter the budget, the fewer options there are for Staging.  And there is a point where all Stagers need to walk-away from a Staging project when they will be losing money.  None of us got into this as a charity to pay our clients for the privilege of getting their house ready for sale.

The rules I see being shared have to do with things like area rug sizes, whether-or-not to karate chop a pillow, how to make a bed, how to dress a table, and how to position furniture.  These are all subjective opinions, and not a reason a house will or will not sell.  And I will share my thoughts and guidelines regarding each one.

Area Rugs: If you want to use a 5’x7’ rug because it fits in your inventory space better, or you don’t have access to 8’x10’ rugs from your inventory provider (most of the rental companies do not provide larger rugs), then use the 5’x7’.  Staging colleagues who share a smaller rug is “wrong” used to use those same sizes when they were newer. When a wood floor is the selling feature in a room, I would not cover up the majority of it with a rug.  This deviates from design principles where you want to have the furniture grouping on the rug and a larger size is preferred.

Logistically, the larger rugs are difficult to store, they weigh a lot, and one person cannot carry them because if they are good quality, they are like a bag of wet sand.  Aesthetically the larger rugs may be preferred by some, however, until I hear the words, “We did not purchase the house because the area rug was not an 8’x10’size, we will continue to use them in properties for Staging, along with our larger rugs for houses that do need a bigger size.  And a TIP from experienced Stagers is use two 5’x7’ rugs that are the same and put them side by side, to create a larger rug.

Pillows: The only rule for pillows would be use them on sofas, accent chairs and beds as way to add layers of texture and color. Ideally you want matching pillows in pairs however the eclectic look is acceptable. Karate chop the middle of pillows with feather inserts or don’t do it.  Either way is fine.  One benefit of karate chopping is if you go to the house and the pillows no longer have that look, you know someone used your pillows, moved them, or sat on the sofa. Buyers do not run screaming for the door when they see a karate chop pillow.

Beds: Some stagers like comforter sets with bed skirts and shams, some like coverlets draped over the bed to the floor.  Some like to layer up the bed and others are more streamlined and minimalist.  Do you use a throw or a blanket folded neatly across the end of the bed? Do you have to make the bed with sheets?  Do you put a tray on the bed?  The answer to the questions is yes or no.  It all depends on what you prefer.  For higher end houses, you do want to take the time to make the bed with sheets and layers.  These are the beds that would be rolled back tastefully to show off the layers.  In other houses, a bed could be made without sheets and layers.  One of the reasons we choose not to dress beds with sheets for all houses is we do not want people “in” the beds and when the mattress has plastic covering on it (for sanitary purposes) and not sheets there is less likely to be fooling around in the bed.  Yes, that does happen.  Stay in the industry long enough and you too will have the pleasure of discovering unmentionables in your beds.

Should you use real mattresses, box springs and frames?  Stagers who share only real beds should be used must have forgotten when they were new(er) and had to make beds out of air mattresses, platforms that were camping cots or boxes or bins. Yes, our industry has progressed, and we do not want to promote cheap-looking staging.  Much like the issue with the large area rugs, for stagers without a warehouse, carrying mattresses and box springs becomes a logistical impossibility.  Good news is third party rental companies provide mattresses and box springs that are reasonably priced. And a TIP from experienced stagers is use two sets of box springs instead of a mattress to save budget.  You can always put a topper on the box spring to create a softer layer before the comforter or coverlet is placed on top.

What about Headboards? They provide a nice, complete look to a bed and dress up a bedroom for a professional finish. There are headboards that fold up but most of them are going to be too large for even a large SUV.  Stagers have created headboards out of foam, fencing, and other creative methods that create the “look” of a headboard without the storage needs.  Sometimes a large piece of art is hung over the bed and shams bolstered up against the wall.  It is all about the budget for the Staging and type of property.

Placement: When arranging a room, a stager needs to consider focal points and function.  An architectural focal point would be a fireplace or a view window.  A living room could have two focal points while a bedroom may not have any and it has to be created with the furniture arrangement.  In general, you want to feature what the room is from the entry way of the room, so placing the main furniture piece across from the entry or in that zone is usually the best option.  Should you angle furniture? Angling furniture helps soften the corners of the room and provides an interesting alternative to having everything squared off.  This may not work for smaller rooms as angling the furniture does create a “dead zone” behind the item and cuts the square footage. It is a subjective choice and harkens back to the notion that there is not one “right” way to stage a room, however there may be a better way.  A Stager learns this with experience and/or moving things around to see various options. 

In my opinion, the word “rule” needs to be changed to “guidelines” and then to “preference,” and when asking for feedback on social media, at some point you need to learn the answer to the question posed at the beginning:  Gut Instinct and experience.  Those two elements will provide you the confidence you need to successfully stage any property and trust your choices.

Why Seeing Your Path Clearly is the KEY to Business and Personal Success

By Jennie Norris, IAHSP® Chairwoman

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Have you ever gotten in your car and just started driving along with no destination? Have you ever gone to the airport and taken a random flight to somewhere? 

For most people, the answers would be, “No,” unless they were on some random adventure quest.  We don’t want our businesses to be a random adventure quest.  We want our business success to be strategic and predictable based on our efforts.

VISION – SUCCESS – FOCUS – CLARITY – FUTURE

All of these words have a common thread – being able to see clearly and know where we are headed.  And these are the words for 2020 for IAHSP® – and the theme of our conferences in Lisbon, Portugal and Denver, Colorado. Our theme and these words were chosen in October 2019 as we started thinking about 2020 and what our goals were as an industry, an association, a business owner and person.  These are great words and we hope you take the time to think about what they mean to you.


VISION

VISION.  We are already into our second month of 2020 – do you have your vision for the year mapped out?  Vision is not only what drives your effort every day, it is also about having goals that support your overall vision and mission.  What is the vision for your company – what is the message you want prospective clients to know and understand about what you do? Why do you do what you do? Do you have your marketing strategic monthly plan to support your goals? Do you know what your revenue goals are for 2020? Do you need to increase sales or reduce costs and if so, how are you planning to accomplish that?

SUCCESS

SUCCESS.   What does Success mean to you?  The general definition is the achievement of a goal. 

What were those goals for you in 2019?  Was it to increase in the number of clients you serve regularly or to maintain your same level of business and revenue? Was it to focus on increasing the number of houses you Stage or types of properties you stage – vacant, occupied, consultations, etc.? Did you have unexpected success?  That is a great type of success – however if it was unexpected, why was it not planned as part of your strategy? This could be recognition or awards you received or something else that added to your revenue or client base.  We need to think about all aspects of our business and there is nothing wrong with planning for recognition or added revenue.

As the old adage says: Fail to Plan then Plan to Fail. We need to set goals for where we what we want to achieve, make sure they are measurable, assess our success quarterly and make any adjustments, and be open to adding to the plans where it makes sense.

If someone were to ask you the following questions, could you answer them?

  • What is your ratio of consultations to vacant staging?
  • How much revenue did you generate? 
  • How did that compare to 2018?
  • Did you have goals for growth, or did you want to maintain status-quo and refine your process? 
  • What was your net profit?
  • Do you have a clear understanding of costs to run your company?

In order to assess and quantify success – and measure it – you need to know the data from your business.  As a business owner you cannot use the excuse that you are not a details person.  You may have had measurable goals and did not hit all of them – and that is OK as long as you know why you did not achieve the goals and put measures in place to get back on track.

Our past can give us keys to our future.  So many people are afraid to look at their business and analyze the good and the bad as they are afraid of feeling like a failure.  Or they don’t really want to know what is going on and go through each day with business blinders on – not really seeing the impact of their actions or attitude and are on the proverbial hamster wheel of work.

Embrace the past as a learning experience or example of what you are capable of and be sure to not let it confine or restrict your potential.

FOCUS

FOCUS. When our Focus is blurred, our path it not clear. Have you ever tried on glasses that were dirty so you could not see through the lens or put on a pair of glasses that were the wrong prescription?  In both cases, you cannot focus or see through the blurry lens and if you do wear the wrong prescription, you can get a headache. Things that can blur our vision and focus are distractions in both action and attitude.  When we encounter something that begins to blur our focus, we may have to take time to handle the circumstance, and then get our focus back on track.

CLARITY

CLARITY.  Clarity is about having Clear purpose behind our actions and attitude.  Our WHY is the biggest motivator for getting us up every day to continue to work in our businesses.  What is your WHY?  Clarity is about removing anything that might cloud our vision or distract us from our goals.  When we have clarity about our intent, our focus, and our goals, our actions and attitude will be alignment.  Focus and Clarity go hand in hand.

It is not a coincidence that CLARIFY and CLARITY are spelled almost exactly alike – one leads to the other.

FUTURE

FUTURE.  We live in the present and plan for our futures. None of us are guaranteed a future but we do need to plan for it and put actions in place that have a positive impact for us and our businesses, for our families, friends, and colleagues.  Every action we take has a reach and impact on others.  Things we do today whether Staging a house, running a business, being part of industry leadership and planning for standards – the impacts are far reaching as what we do impacts others. Our goal is to be an Impact Player for the betterment of life experiences for all we have the pleasure and opportunity to have in our lives.


As opportunities present themselves, we need to assess whether they are in alignment with our overall vision for our lives, and our goals for our business.  We must remain open to adding things that support our vision and adjusting our path for success as needed and taking risks in order to experience the rewards.  It is important not to put blinders on as then we miss opportunities to add to our path for success.  Rewards are not monetary – they are intangibles.  The relationships we receive, the opportunities to make a difference in someone’s life, the ability to guide an industry for the future, these are responsibilities we need to take seriously.


To be part of the Vision for Success: Focus, Clarity, Future that IAHSP® is providing to the industry and our members, go to www.IAHSP.com.  IAHSP® is your Business Support Association® and Your HOME in the Home Staging Industry®.  We have FAST-LEAD Workshops being held live in major cities, our two conferences that bring you high level education and the largest Vendor EXPO for our industry, and the opportunity to meet colleagues from around the world.

Announcing First Two IAHSP® Conference & EXPO Keynote Speakers PLUS NEW Industry Designation!

IAHSP® Conference & EXPO – the Home Staging Industry Event of the YEAR is bringing exciting, knowledgeable and quality KEYNOTE SPEAKERS to you! We have 3 we have lined up – we have announced TWO so far! The THIRD one will be announced soon!

Go to www.IAHSPConEXPO.com to register now before prices go up! Lock in PRIORITY ATTENDEE STATUS and be first in line for KEYNOTE Meet and Greets, Premier Seating, and Special Exclusive Speak Easy during our Awards Dinner Great Gatsby Gala!


JONNY FOWLER

JONNY FOWLER: Jonny is a marketing and social media guru. Jonny founded Hancock Mortgage and has helped grow a thriving business. One of his main passions is marketing and social media, as an Industry Leader Professional Speaker Social Media Specialist and Industry Innovator. Jonny shares in-depth, timely information that works to bring you business. He understand how platforms like Facebook and Instagram work and teaches how to work the system to outsmart algorithms that limit our exposure. You will learn not just what to do but HOW to do it. His two-hour keynote session will be one of the BEST you have heard to help your business grow and thrive.


RAVI HUTHEESING

RAVI HUTHEESING is an international keynote speaker and cultural
catalyst. He empowers businesses, educators, and millions of
people worldwide to pivot and transcend cultural and generational
divides, and his incomparable life story keeps audiences on the
edge of their seats.

The first American-born member of the family that created and
governed the world’s largest democracy for over 40 years, Ravi is
the grand-nephew of Jawaharlal Nehru (India’s first prime
minister) and the cousin of prime ministers Indira Gandhi and
Rajiv Gandhi.

His worldwide visibility skyrocketed in 1997 when he became the guitarist for triple Grammy nominee, Hanson, whose massive millennial fan base catapulted them to the White House, Madison Square Garden, Tonight Show, Good Morning America, Saturday Night Live, and more.

in 2014, he was invited to serve as a cultural diplomat for the US Department of State and went to Russia to give presentations on arts, entrepreneurship, and youth leadership. In 2016, he went to Indonesia and created songwriting and cultural entrepreneurship programs that bridged
the most severe cultural and religious divides.
As a global citizen, Ravi continues to pivot and grow. He shares his experiences and revelations in an effort to increase cross-cultural understanding and create a pathway to world peace.


NEW INDUSTRY DESIGNATION FOR ALL ATTENDEES!

We have industry experts sharing on this topic. Ravi Hutheesing will be part of this designation education.

All attendees at the 2020 IAHSP® Conference & EXPO will earn their IAHSP®-CDE – Cultural Diversity Expert Designation.

We are in a people business and Staging is a global service. Our cities and communities are becoming more diverse with multi-cultural influences from people from all over the world.

Misunderstandings or misimpressions about differences can offend people by mistake and we need to understand cultural differences, nuances and traditions in order to better serve our clients.

The IAHSP® Cultural Diversity Expert Designation (IAHSP-CDE®) will teach you:

  1. About major cultural groups and what their expectations are in business
  2. Do’s and Don’ts in working with various cultures and ethnicities
  3. How to approach sensitive issues related to Staging
  4. Why Diversity and Inclusivity are linked together
    Our Speakers for this session will provide expert insights on the topic.

Go to www.IAHSPConEXPO.com to register now! Prices go up soon! Call 844-IAHSP99 for information!