How does staging affect an appraisal in New Jersey?
Staging a home has become increasingly common in New Jersey. There’s a good reason for that. According to numerous studies, staged homes sell faster and for more than non-staged homes. But how does staging play into valuation?
It’s all about condition. Staged homes certainly can command higher prices than those which aren’t staged. However, it generally is impossible to completely hide a dated kitchen even with neatly folded napkins and a bowl of lemons. An undeniable part of staging is the underlying condition of a home. A home with neutral recent updating, even if not staged will sell for more than one without. Staging can only go so far- ultimately the price of the home still needs to be in line with the price of comparable alternatives on the market or recently sold.
Ultimately, staging is really all about the basics of getting a home in market-ready condition. Consider the opposite extreme – the seller who doesn’t clear their home of clutter and get their home in squeaky clean shape. The underlying materials and updating are the same but home purchases are emotional decisions and a sale of a home involves a buyer visualizing themselves living in the home.
From a valuation standpoint, it’s clear that we see NJ homes with staging selling for more sometimes. We also see them selling quickly (if priced accurately). Given the prevalence of staging, it’s usually the case that in a market where a home is sold with staging, comparable homes also have staging. Appraisal is a data based business and ultimately the end results of an appraisal will be hinged on those. An appraiser will not view staging with emotion but certainly will view condition which is magnified by staging when selecting comparable sales and making adjustments in an appraisal. Will an appraiser consider a dated home with staging to be equivalent to an updated home without staging? Unlikely. Will an appraiser ratify an offer price which is clearly irrational given the alternatives in the market because a home was staged? Also unlikely. But a good appraisal will use comparable sales which have similar levels of condition and cosmetics and this includes a search for comparable sales and listings with similar levels of staging.
