RE Investors, Don’t Leave $$$ On the Table. Stage Your Flip!

We've all heard the saying you need to spend money to make money.  For real estate investors, this is particularly true. This is why they buy fixer upper properties, replace flooring, paint, update kitchens and bathrooms and more. Why would anyone decide not to stage their flip and leave money on the table?
Home staging creates a significant return on investment. The National Association of Realtors has said that staging can add as much as 6-15% more to the price of a home.  

 


Home staging helps buyers to emotionally connect to the home. It establishes flow and function. It can even make a home feel more valuable by appearing more luxurious. Fantastic contemporary furnishings, soft textiles, and warm colors create a home for buyers that may otherwise just been seen as the shell of a house. By allowing potential buyers to focus on what their lives may be like in the house vs how the furniture might work, buyers are more easily connected to the home. All awkward spaces are removed when the home is staged, allowing buyers to focus on the features and finishes.

Albuquerque investors understand that the value of any update is not it’s cost but rather its return. If there is a significant enough return then that upgrades worth doing. Home staging meets this criteria (and then some).
As the market continues to improve, there will be more and more investors ready to create a tidy profit by fixing and flipping foreclosed and run down properties.  For these investors, staging is an imperative to make sure that they make the most of each of their investments.

How to Deal with an Ugly Brick Fireplace when Selling your Home.

Whatever the season, fireplaces add a charming coziness that is attractive to potential buyers. However, if your fireplace is dated and dirty, here are some quick fix ideas to make your fireplace look its best.

The easiest way to update an old brick fireplace is to give it a good cleaning. There are many products out there to help remove the soot and grime from inside and out. Make sure to thoroughly clean the screen, or maybe just replace it with a more contemporary one.

Painting a brick fireplace is a quick easy solution. I recommend whitewashing instead. It’s the same process, just dilute the paint with an equal part of water. If you have a little more time and patience, use a rag or brush to rub a light coat of paint on the bricks, one at a time. This will give them a new tone without covering them completely. If you use a paint color that matches the walls, your fireplace will go from sticking out to standing out.

Brass fireplace screens used to be very popular in homes built in the 80’s. Unfortunately, now they are dated, and most homebuyers prefer more updated finishes. A simple upgrade is to painting the brass screen with High Temperature/Heat paint.  

These are fantastic yet easy solutions to update your fireplace as you prepare your home for a successful sale.  

Staging Expenses are Tax Deductible.

Home Staging Tax Benefit

Most people have heard of staging as a tool to help sell their home. Staging improves how potential buyers perceive the home. Staged homes usually sell faster and for more money than un-staged home.  Another valuable consideration in choosing to stage your home is that the expense is tax deductible.

I am not a CPA, so you need to talk to your tax accountant to see how and if this applies to you, however according to IRS publication 523 expenses related to home staging can reduce your capital gains taxes in either of two ways. The IRS allows deducting advertising expenses from the proceeds of the sale of a house. Since the work a home stager performs is to help market your home, the IRS considers these fees an advertising expenses. Just like Realtor commissions, escrow and legal fees, you deduct these expenses from the proceeds of the sale. This reduces the amount of taxable profit you earn from the sale of your home.

Again, it is very important to speak with a tax professional because some types of home staging may not qualify as an advertising expense. If a home stager recommends and executes a larger home improvement like updating a kitchen or adding a new deck, this is the second way to lessen your tax burden. Unlike the advertising expense, these are not deductions. These expenses are added to your basis, which increases the expense deducted from the proceeds, which determines your net taxable profit from the sale.  

Whether home staging fee is an advertising expense that reduces your net sales profit, or a home improvement that increases your basis to subtract from your sales proceeds you benefit from a tax saving.  Please remember to check with your tax professional to make sure that you are following the tax laws correctly.

Episode 3: Preparing your Home for Sale, Repairing

Press the play icon above to have a listen.

SHOW NOTES:

Most Buyers are looking for trouble-free, ready to move into houses and first impressions are key!   Leaky faucets, cracked tiles, broken appliances or anything else that doesn’t work like it should, may turn off buyers. A pre-inspection gives you the opportunity to find out if there are any hidden problems with your home. However, any faults that are discover and not repair, must disclosed to your agent and potential buyers.    Once you know  if anything is wrong, you can have those issues fixed before you list. Some homebuyers  are looking to buy a fixer-upper, however these buyers often will discount the price of the house to allow for the repairs and, a bit more for the inconvenience. Make a list of everything that is defective, broken or worn out.  Decide which items you can fix yourself and which you will need a contractor to fix for you.  So repairing your home is the third step in preparing your home for sale. Not only will this help in selling the home for a higher price and in a lesser amount of time, but it will make the whole transaction go much smoother. 

Episode 2: Preparing Your Home for Sale. Decluttering.

This is part two of a four part series on preparing your home for sale.  Decluttering your home for sale is very important. Edgar Marroquin, Albuquerque Home Stager gives good advice to Albuquerque homeowners on how to prepare their home for sale. Press the play icon below to have a listen.  

Albuquerque Home Staging Podcast SHOW NOTES:  1. Decluttering is Daunting, take your time work on just one room at a time. 2. Keep only the basic things you'll need while your house is on the market. 3. Make sure to rent a storage space for your stuff.  4. Keep, Sell, Donate and Trash.5. Make sure to clear out your closets and garage.