How home buyers perceive the value of your home affects the price they are willing to offer. But what is “perceived value”? Per BusinessDirectory.com, “perceived value” is defined as:
A customer’s opinion of a product’s value to him or her. It may have little or nothing to do with the product’s market price and depends upon the product’s ability to satisfy his or her needs or requirements.
In real estate, this explains the occurrence of bidding wars, multiple offers, and bully offers. Important factors like location, listing price, or the property’s condition or all of it, can come into play. Let’s look at four ways perceived value affects your final offer and what role home staging plays to a home seller’s advantage.
FACTORS THAT CAN AFFECT YOUR HOME’S PERCEIVED VALUE
As professional home stagers in Toronto and the GTA, we’ve helped increase the perceived value of many homes in the area. To give you an idea, eight out of ten properties that we have staged in Toronto this year have sold from $80,000 to $250,000 over it’s asking price. These results clearly show that buyers are willing to pay more if they strongly feel that the property is the perfect fit for them.
Location can significantly affect your home’s perceived value. However, two identical homes in the same block can have different values if one is in a quiet street and the other, poorly located beside a hydro plant or backs up into a highway. In both cases, presenting a well-showcased home is a no-brainer; it can add more value to a well-situated home and arousing interest on the other hand, in a property in a less desirable location.
While you cannot change your home’s location, what you can change is your home’s interior. Showcasing a stunning and functional interior can win even the most discerning buyer.
2. Your home’s condition
If your home is screaming dated, it’s time to make some changes that will increase the perceived value of your home. Consider changing out cabinetry, countertop, paint colors, flooring, appliances, lighting and plumbing fixtures to what’s currently on trend. Most buyers nowadays want a move in ready home. Nobody looks forward to doing more work after an exhausting buying and selling process on top of an already busy work and family life.
Smart upgrades can mean more money in your pocket because your buyer will see your home as well maintained with less likelihood of immediate problems. In the same token, it’s important to ensure that anything that needs repair is fixed. A stove, heating system, small cracks on the wall or a faucet that leaks are immediate turnoffs. These are small problems that can be easily fixed that look like big problems in your buyer’s eye.
3. Size and function
When it comes to buying a home, the square footage of the property is always on top of the list because most of the time, potential buyers are upgrading. So whether it is a 500 square feet condo or a 2500 square feet detached home, it all boils down to function. More than the look of the space, it is its functionality that will win the buyers. Your home has to offer solutions to their current problems.
A buyer perceives the value of your home to be higher if it meets the functional requirements he needs. If he needs three bedrooms because of his growing family, he’ll be willing to pay more for a house that has that amount of functionality. If you have a three-bedroom home and are using one bedroom as a home office, you might consider having it staged as a bedroom for example.
4. Wow factor
Let’s admit it everybody loves a beautiful home, every buyer has a dream lifestyle in mind. It is that place where you feel accomplished, successful, and you just feel good about yourself. Owning and coming to a beautiful home is one of them.
If there is nothing nice to look at your home to wow your buyers — no rare architectural detail, you’re not close to a known landmark, and nothing really distinguishes your home, then you have to make it shine to help improve its perceived value. This can easily be done through proper staging and the right merchandising.
When selling your home, it’s important to realize that a buyer may not always use the listing price as a guide in making an offer. There are factors and ways that perceived value can affect your final offer. Home staging gives you the ability to offset any negative attributes of your home with more appealing options that will positively affect a home buyer’s perceived value.
Toronto-based, award-winning Interior Stylist, Red Barrinuevo is an Interior Decorator and Principal Designer of Redesign4more Inc., servicing clients in Toronto and the GTA. The firm’s known for enhancing and creating stylish yet functional spaces through their creative home staging, interior styling, and design services. To know more about Red and Redesign4more, visit www.redesign4more.com