Real Estate Staging / Home Staging Blog

Another POSTIVE reason why home sellers can benifit from Home Staging is because the fees for a staging services can be considered an advertising fee (See IRS Publication 523) and influence a seller's capitol gain or loss on a property that has been sold.

What is IRS Publication 523 and what does it say? IRS Publication 523 explains all tax rules that apply when a home seller sells their main home, including advertising expenses and how they influence the seller's capital gain or loss on the property.  It does not cover the sale of a rental property, second home or vacation home.

What does IRS Publication 523 consider seller's main home? The term "main home" usually refers to the home the seller lives in most of the time.  A main home can be a house, houseboat, mobile home, cooperative apartment, or condominium.

How is capital gain or loss figured on the sale of a seller's main home? In order for a home seller to calculate the capital gain or loss realized on the sale of their main home, they must know the selling price, the amount realized and the adjusted basis. 

What is the selling price? The selling price is the total amount a seller receives for the sale of their home, including money, all notes, mortgages, or other debts assumed by the buyer as part of the sale and the fair market value of any other property or services they receive.

What is the amount realized? The amount realized is the selling price minus selling expenses.  Selling expenses include commissions, advertising fees*, legal fees and loan charges paid by the seller.

*Staging a home for re-sale can be considered an Advertising fee.  There are no time limits on the Advertising Fees related to the sale for the IRS.  However, it is important to note that if a property does not sell and is taken off the market, expenses for that transaction are NOT deductible in the future.

What is the adjusted basis? During the duration of ownership of a main home, increases or decreases (adjustments) may have been made to the basis (base cost, either bought or built, of home).  This adjusted basis must be determined before capital gain or loss can be figured on the sale of the home.  There are many rules when computing the adjusted basis.  Consult a Tax Adviser to accurately determine the adjusted basis. 

To quickly estimate capital gain or loss, apply the following formulas:

• First Calculate: AMOUNT REALIZED = Selling Price - Selling Expenses
• Next Calculate: CAPITOL GAIN/LOSS = Amount Realized - Adjusted Basis

IMPORTANT: EVERY HOME SALES TRANSACTION IS DIFFERENT. TO KNOW HOW THIS TAX RULE EFFECTS A PARTICULAR HOME SALE IN YOUR STATE, PLEASE CHECK WITH A TAX ADVISER OR TAX CONSULTANT REGARDING IRS PUBLICATION 523 AND HOW IT MAY AFFECT YOUR SELLER'S INDIVIDUAL TAX SITUATION.  More information on IRS Publication 523 can be found on line at: http://www.irs.gov/publications/p523/index.html  

But in order to create this REAL appeal within a house, a stager might have to resort to some "fakeness". One of the basic practices of staging (like decluttering or depersonalizing) is to bring the outside in. However, while some in our industry suggests its as simple as going out and clipping something fresh and green from one's garden, in reality that just might not be possible. Both climate and accessibility quite often can put the kybosh on little treks out to one's lovely garden... because it is freakin freezing and everything is dead... or, oh ya you don't HAVE a garden, you live in a high-rise condo.

This is where fake plants can help. Today's silks are so "perfect" and so widely accepted that they just blend into the background and MORE IMPORTANLY do not distract a buyer's eye. Fake fruit does this too. However using fake FOOD as a prop is a No-No! For some reason people are captived by fake food, they love to go up to and look and touch fake food to see just how "real" it looks... which means the buyer is distracted and is looking at something other than the house.

In vacant homes, it is quite acceptable to use fake TV's, especially flat screens, which are quite often used to help a buyer understand how a room can be configured... as TV watching a big part of our culture. (We happen to use proptronics.com as our supplier for these props. Today, after writing this, I called and spoke with Darlene, the owner, who graciously offered to give any stager who mentions this post a discount. HOW COOL IS THAT! Please, just ask for Darlene or Michael.)

That being said, I want to stress the importance that while sometimes "Fake" is  OK... it is NEVER OK to resort to contrived trickery. Contrived staging (<- LEFT) just tries to hard. Resorting to laying out silk gloves, with single red rose (fake); setting tray on a bed with a tea cup, a sonnet book with the word "Love" configured out of sticks from your garden; or setting out 2 champagne glasses wrapped with raffia bows on the edge of a tub is just NOT real and is not the way most people live. Because this is NOT the way MOST people live, it becomes a contrived distraction to a home buyer touring the home.

So always remember, the best staging is about the HOUSE being the star, not the stuff. The most talented stagers know and master the principal that "less is more" and their work is always tastefully understated.

The picture (right ->) of a staged property (just staged and self-photographed this week by Marci Toliver of Fresh Eye Designs) is a perfect example of how to apply the understated "less is more" approach to staging... and as you can see, it is a beautifully appealing room without being contrived. Oh ya... and one more thing... Marci created that floral arrangement herself using fake tulips.

Stage It Forward...

Me

PS: THANK YOU MARCI... for allowing me to feature this picture of your beautiful work. STUNNING!

HOLY MOLY NBC did it again! They picked up my blog feed. Here is the link to ths San Fransico NBC bay site and my blog on The Stage It Forward on Active Rain. ( I have NO idea what I am doing. I feel like Sally Field winning an Oscar.)

I can personally attest to just what impact Active Rain can do to legitimize and move forward an entire industry.  You see, the very day Active Rain added the "Group" functionality... the Stage It Forward group was born. This past Saturday, that small group hit its own milestone...  the 300th member joined. (Actually it hit and surpassed 300 as I was writing this post on Saturday.) And while that might not seem like a big deal to most... for the Staging Industry it is HUGE.

The Stage It Forward group, one of the Top 10 most active groups here on AR, has become a gateway resource for GREAT home staging information, FREELY and respectfully passed along to Realtors and Home Stagers alike. Each day, as members and the general public log in, they can read well articulated stories of staging from all across the USA and Canada.

Realtors, who never considered using a stager, are being bombarded with visually stunning examples of what Stagers do. Stagers are relentless to make sure Realtors GET the power of what they can do for them and their sellers. Still not sold on staging? All one needs to do is go in our group to read stories of success, after success, after success... for these stories abound in this group.

But what I am most proud of is to see how Stagers help each other. You see I have been in the home staging industry long enough to know that there WAS an underlying negativity that was keeping our industry small. In fact last fall, before the Stage It Forward group started, I heard that the Oprah Winfrey Show was going to be doing a show on home staging, so I wrote a producer alerting them to becareful who they picked to be featured on the show.

• Here is what I wrote to the Oprah Show...

     "While the ‘concept' of staging has been around for years, a separate and distinct staging industry is just finally being born. (And OH BOY there will be nothing like an Oprah show to push it out the industrial birth canal!)

     But there seems to be a network of feudal warlords, within our industry, who have developed their own staging kingdoms... and are right now battling it out.  AND THIS DRIVES ME NUTS! Why... because I watch Oprah and I too believe in a greater possibility. 

     I am so trying to create synergy and harmony at the BIRTH of an industry. I know that thinking together as a united group will benefit the consumer. I know that being a Stager, has become, and for more and more will be their dream career. But right now... this "industry" is and stays small because it resorts to being lead by a bickering bunch."

I believe that writing this to Oprah, planted the seed in me to do something more. So when Active Rain created the Group functionality... I instantly (literally) saw an opportunity to mimic what was happening in the "larger" Active Rain and establish something that would specifically benefit ALL Home Stagers, regardless of where they received foundation training. And it is working... through Stage It Forward stagers now have easy access to and can see what the power of sharing and respecting diversity can do to help them and to continue to move the entire Home Staging Industry forward into the future.

So once again, thank you to Active Rain and all the members that help Stage It Forward...

Me

POST SCRIPT:This blog/article was picked up and appears elsewhere:

• NBC did it again!They picked up my blog feed. Here is the link to e San Fransisco NBC bay that picked up a version of the above blog. Here is the LINK> The Stage It Forward on Active Rain.
• The American Chronicle also picked it up. Here is that LINK> Home-stagers Create an Industry Voice.

I woke up this morning thinking about my recent (NBC) post and the many thoughtful, supporting and encouraging comments that were made by so many... that I just had to do something to show just how much I appreciate all of your kind and generous words. So this is my "collective Comment of Thanks" to all your comments.

What is so odd about Active Rain, is that while you can find amazing and well written blogs that teach so much, share so much, and help so much... it is in simple short Comments where "volumes" are often spoken.

It is the Comment that gives Active Rain life. For in the Comment something magical happens between reader and writer. This "something" is hard to describe, but when you experience it, you know it. 

When we try to get our colleagues to join Active Rain we want them to benefit from all the great information and dialogue that is being shared, but I believe it is that "something" within a Comment we truly hope they get.

Stage It Forward...

Me

Today has been a day I will ALWAYS remember... and I have to thank ACTIVE RAIN for so very much of it.

Yesterday morning I discovered that NBC-5 TV in Dallas had picked up one of my recent posts from my "Pretty Blog" (which is my AR blog slightly re-constituted) and posted it on the station's website. I was flabbergasted. I was floored. I was thrilled. And I really wanted to thank Active Rain... However, my "thank you" was going to have to wait as I really wanted to also post my 3 Year Anniversary Post.

When I finally DID get  to post my thanks to Active Rain I was going to say that I could NEVER write what I do without having the audience they created for my words. You see if I was JUST posting my words out into that GREAT BIG WWW, I would never been able to write what I do. Active Rain brought this amazing COMMUNITY together where VOICES could share ideas, thoughts, interests and challenges.

BUT THEN... this story gets BETTER.

Tonight I was poking around and I discovered THAT ALL NBC sites in the NATION had my blog posted.

BUT THEN... this story gets BETTER.

MORE poking and I discover that TONIGHT'S NEW POST was also featured nation wide (List of NBC NEWS Stations Here).

THAT is 2 posts in 2 days!!!  

HOLY MOLY how crazy is that? I don't know what to think. All I can say is THANK you to my fellow Rainers... to all you who share so much of yourselves and "listen" to what I have to share. You make it so easy for me to share my words.

And again to the Active Rain Gods... THANK YOU. If ANYONE EVER wonders WHAT the power of blogging is or what it can do... send them my way.

Here are 2 links to 2 different NBC stations (Dallas and New York City) "featuring" 2 of my posts. I have NO idea how long they will be taking my feed.

DALLAS: Click image directly to the left to go to NBC DALLAS Site, where I first found my  "Ugly 'R' Word" post.

OR go to ------->

NEW YORK CITY: Click image directly on the left to go to NBC NY City Site, where tonite I found my  "3 Years Ago TODAY..." post.

Rain It Forward...

Me

PS: To TOP this day off... TODAY is my 18 year Anniversary of being with the love of my life!

POST SCRIPT: My thanks to all those who have shared kind words in their comments can be found HERE.

Today, on the 3rd anniversary of my first home staging... I thought I would share the backstory behind my first staging experience and how it convinced ME that home staging works.

In March of 2004, a little after I had completed my studies in Interior Design, I was asked to stage a condo (that had a lot going against it) in Chicago.

I can remember thinking... "Staging? What's that?" You see, I really knew NOTHING about staging.  So I went about researching what I could on the web. But unfortunately, at that time, there was not much information to be found, as there is today, but there was enough information that I got the "basics" of what staging is all about.  The "basics" I remember getting was to de-clutter and let the HOUSE be the STAR not the STUFF in it.

So with the information I could find, and did the next best thing I could do... I took and blended this new understanding with: 1.) My life expierence with moving (my father, an account executive for United Air Lines, always had us get the house "ready for selling" each time we were transfered) 2.) My newly educated passion (interior design) and 3.) My professional careers spanning the past 20 years (advertising, marketing & sales).

I can remember going out and spending about $700 on props for this 2 bedroom 2 bathroom condo and thinking "what would I do with all these fake plants & nic-nacs when the house sold?" BUT I didn't fret too much... as I figured I could always use the PICTURES I took for my interior design portfolio. (Funny thing is I DON'T use these pictures for either my staging portfolio or my interior design portfolio.)

Well, anyway, the staging worked... and worked GREAT!

This home sold in 10 days, had 3 offers and sold over list price. WHICH is not that odd, EXCEPT for the fact that NOTHING had been selling it the ENTIRE high-rise for months as any new owner was going to be hit with a special assessment for new windows. In the case of this particular unit the assessment was going to be a whopping $20,000! 

Also working against the sale, in this particular home, was the original kitchen (ugly dated metal cabinets) and there were OTHER units in the same tier of the high-rise with fully renovated kitchens. Needless to say much was going against the sale of this condo. 

It is no surprise that the Listing Agent still takes pride in the fact that for over 2 years this unit held the sales price record for non-renovated 2 bedroom 2 bathroom units in this high-rise.

I experienced FIRST hand just how awesome of a tool staging can be to help sell real estate.

Needless to say, I was SOLD ON STAGING and Real Estaging was born.

Stage It Forward...

Me

Last November I took a business trip to China. I went there because the professional designer "me" was needed, however to my surprise the personal "me" was profoundly impacted.

While I was in China, I visited both Hong Kong and a city called Shenzhen (45 minutes from Hong Kong via water taxi)  on the mainland. During this trip it became quite apparent that Hong Kong was all about consuming, and Shenzhen was all about manufacturing.

Shimmering and sparkling, yet cluttered in EVERY nook and cranny of the streets of Hong Kong, were shops, stores and boutiques selling every conceivable thing we stuff into our lives.

In contrast was Shenzhen, a city where pollution is constantly spewed out of the thousands and thousands of factories located there. The pollution was so bad that I could literally and easily look directly into the sun in the middle of the day. At one point we drove over a river that was so polluted it was thick and black as tar. (I am NOT exaggerating.) The sad part is Shenzhen is just one of the multitude of manufacturing cites throughout the world that makes the material goods we "need" in our consumer society.

Upon returning to the states, I came to a full circle moment... when I started to reflect on all I had expirienced and thinking about how it affects my job as a home stager.

I came to realize that in this age of consumption, its kind of odd that stager's job is to "transition" a home back to simpler view. Basic to staging is de-cluttering the mass amount of consumer "stuff" that has built up in a house. In fact, if staging is done well and timed right, the seller can make more money on the sale of their home... which they might use to go out and buy more "stuff".

But now, due to my trip, and if I have it my way... people that use our staging services will begin to look at their lives and their desire for stuff in a new way. I hope to show people, whose homes we transform, that a beautiful home does not need to be STUFFED full of useless consumer junk.  I hope to share with all our clients the fundamental lesson something EVERY interior designer is taught early on in their design education... "Less is More" 

But now, because of my trip to 2 cities in China, I realize our planet's life depends on less being MORE.

Green It Forward...

Me

I happen to know among clients, home selling professionals, developers and stagers that there is controversy swirling around this very hot topic.  It seems like everyone is chiming in on one side or the other, having a very strong and opinion on the subject. However, some of these negative opinions I feel are quite prejudiced. I feel all these people are misinformed and it is their ignorance that propels the myth and controversy that surrounds the "R" word.

Quite recently, we lost a client because we decided to start using the ugly "R" word. THIS got my blood boiling. NOW I am on a crusade to... Stamp out the ignorance! Stamp out the prejudice! And end, once and for all, what is been wrongfully labeled as "BORING" and "UGLY"... that is Rental Furniture!

To begin to put an end to the Rental furniture myth I am going to post a few photos from ACTUAL (NOT slick studio produced photos) stagings we did for home sellers all over metro Chicago where we used rental furniture and then added all the beautiful BLING from our own prop library.

Initially, having our own furniture in our prop library helped us get started and differentiated us. But, we began to look at what we had invested in the furniture alone and the return on the investment we were getting from THAT portion of our prop library... and we made a strategic decision. If we can't carry it (physically) we won't carry it (in our prop library)... we will rent it.

We have come to this conclusion for 2 reasons: 1.) It was getting WAY to expensive to first PURCHASE and then continuously transport, move in, move out, repair, clean, store and insure the hundreds and hundreds of furniture pieces we now are placing in homes. 2.) We found that Brook Furniture Rental, a Chicago based rental company with locations in CA, GA NV, TX, and DC, had MULTIPLE and diverse LINES of furnishings, and a willingness to work with us.

So, a few months back, we began our relationship with Brook Furniture Rental. I have to admit I have been delighted, for MANY reasons, but the first and foremost reason is we both share a common commitment to provide the best level of staging creativity and service to our clients.

So the next time we have a client that says anything bad about rental furniture... we know that we here at Real Estaging can hold our heads high with RENTAL PRIDE!

Stage It Forward...

Me

POST SCRIPT: This is the 4th and Final blog in a series were rental furniture was "secretly" used. The other 3 blogs featuring rental furniture can reached by clicking on the links below.

• Part 1 can be found here: Classic Georgian Staged in Winnetka 
• Part 2 can be found here: Staged Wright in Oak Park
• Part 3 can be found here: Town-home sits UNSOLD for 7 months... THEN SELLS JUST 2 DAYS AFTER STAGING

Whether you are a Realtor or home stager, being able to tell a TRUE SALES STORY or DEMONSTRATE YOUR TALENT via pictures is critical.

Home stagers are in an industry where the impact of our work can best be shown via photography. I keep stressing the importance of GOOD photography because I KNOW one of the KEY REASONS we here at Real Estaging have been so successful is because our photography tells our TRUE STORY.

Unfortunately a camera does NOT always capture the true story. (I blogged about "Lying Photography" before.) However, while in that previous blog I stressed the importance of CLEANING up a photo... but I did not tell you just how to do it.

So here is a step by step walk-through on how you can us tools to correct an image and show the buyer/client just what they will REALLY see when the tour the home you have staged or are selling.

PLEASE NOTE: I AM NOT SUGGESTING you change a photo so that the REALITY the photo is a lie. I am saying that cameras are TOOLS that DO NOT always capture the truth... but with the help of other TOOLS like PhotoShop you can move a picture BACK to what a buyer would truly see.

While not every picture we take need as much editing, the type of corrections I have made on the one pix below would take me about 5 minutes to make. Which is NOT a huge investment of time... but the RETURNS are worth it.

Finally...If you look closely at that FINAL edited picture the image bows out (in my own comment below). I can not fix this using PhotoShop.... as it does not have a tool that can fix this distortions that wide angle lenses create. But this drives home the point that PHOTOS LIE!

The importance and willingness to give back is basic to what the group of stagers in Stage it Forward are all about. Its so basic, that in the group's short description here on Active Rain, the words "share" or "sharing" is used in 3 separate places.

For me however, Stage It Forward is more than just helping other stagers grow their businesses... for me, Stage It Forward meant using my time, talent and treasure to benefit my community.  So at Real Estaging, our current Stage It Forward effort centers around the creation of a spectacular community wide fund raising event for Brickton Art Center... a WONDERFUL not-for profit organization (grounded in outreach) in Park Ridge Illinois.

This year we helped re-invent and invigorate Brickton's Artistic Living event by refining it and adding a Tour of Homes. With a goal to raise $20,000, here is what we have been working on and organizing since last summer...

The Artistic Living Tour of Homes event will revolve around art galleries featured within each room of a newly constructed home (donated for the weekend of May 18th - 20th by Tim Metropolis of TMM Development Corporation and listed with Gretchen Gullo of Coldwell Banker) in Park Ridge.  This beautiful constructed Arts & Crafts style home will be the Gallery House where its interior spaces will be transformed and feature the creative works of both artist and designer. This house will also host the: Gallery 1033 Cocktail Party - a unique themed grand opening cocktail party and event night, and Silent Auction Room - featuring a variety of donated artistic objects, gifts and other items from local businesses.

In addition to the primary Gallery House, this tour will also feature several other beautifully designed homes of Park Ridge. Residents are opening the doors of their houses to be featured as homes on the tour. Craig Interior Design (our sister design studio) is helping to stage & stylize homes with FREE design advice and help prior to the event.

The final fun new twist is that Brickton is commissioning a special gallery exhibit entitled The Doors of Park Ridge. This show will feature and exhibit the artistic interpretations of doors of homes, schools, shops, or churches etc. throughout Park Ridge, as seen through the eyes of and created by local children.

The whole event is designed so that whether donating "BIG" or donating "SMALL" of one's time, talent and treasure, we have created many ways for others to experience the joy of giving and share in this wonderful event. I really hope all my Illinois Active Rain colleagues can stop by and see the power and what is possible when you Stage It Forward.