When Corcoran’s Victoria Reichelt picked up a two-bedroom co-op listing on the Lower East Side last year, its décor comprised a single chair and a few ugly bookcases. After the unit, at 212 East Broadway, sat on the market for months, Reichelt followed standard procedure, trimming $50,000 from the asking price. But she also persuaded the buyer to spend $5,000 staging the apartment — something she wouldn’t normally consider for an apartment asking just over $1 million.
“On the Lower East Side, no one does staging,” said Reichelt, who sold the property last month for $1.1 million, slightly below the original ask but $170,000 more than what a similar unit in the building fetched.
Once seen as the bright spot in Manhattan’s slowing residential market, lower-end apartment sales have gone from quicksilver to sluggish in the last six months. As of March 26, homes in the borough priced between $1 million and $2 million were spending an average of 82 days on the market — up 32 percent from last year, according to data from UrbanDigs.com. Those asking between $600,000 and $1 million spent an average of 70 days on the market, a 32 percent jump from 2016.
As a result, staging, which has long played a major role in the high-end new-development world, is increasingly being used for lower-end properties.
Victoria Reichelt and Tamara Hubinsky
Brokers told The Real Deal that even spending a small amount on staging can move difficult-to-sell pads and, in many cases, help dodge a price reduction.
“You have to compete with the fresh look of new development that [buyers] are seeing —even if they can’t afford it, that’s what people expect,” said Brown Harris Stevens’ Leslie O’Shea, who credits staging for the contract recently signed on one of her listings, a $1.4 million co-op at 160 East 38th Street. “I was always hesitant to ask sellers to put money in, but I wish I started doing it years ago.”
Persuading sellers, however, can be tough. “At a certain price point, because there is an initial investment required, it scares off many sellers,” said Tamara Hubinsky, the interior designer who staged the co-op at 212 East Broadway. Hubinsky said she’s seen a jump in inquiries for staging cheaper apartments, with brokers trying to capture the attention of aesthetics-conscious buyers.
Certainly, it can reap financial rewards: CORE’s Tony Sargent said that at one of his listings, a one-bedroom asking $840,000 at 201 East 17th Street, he persuaded the sellers to repaint, replace floors and rent furniture. The apartment received 10 offers, according to Sargent, and is now under contract for more than the asking price.
While brokers closing above ask, or sidestepping a price cut, is ideal, the main objective is more modest: moving the property.
BHS’ O’Shea said that the $50,000 the seller at 160 East 38th Street spent on staging paid off because it drew people to that apartment instead of the other listings in the building — of which there were several.
“They were coming into that particular apartment because it was aspirational and happy,” O’Shea said.
Roberta Axelrod, the director of residential sales and marketing at Time Equities, agreed that staging piques buyer interest. “You definitely end up selling it faster,” she said. Time Equities had seen great success staging cheaper apartments at projects in the West Village and on the Upper West Side, she added. Two that were asking less than $1 million sat on the market for more than eight months before they were staged. In both cases, they sold within 45 days of getting a makeover.
And for those for whom dropping several thousand dollars is out of the question, virtual staging, which costs around $100 an image, offers a cut-rate alternative.
“Doing actual live staging is still way too expensive in most cases,” said Siderow Residential Group’s Joshua Arcus.
Steve Snider, a broker at CORE, pointed out that staging’s popularity at the top end of the market makes many sellers think it’s out of their price range.
Sellers, he said, “look at one of Fredrik [Eklund’s] listings, and he’s spent $150,000, and they think that’s what they have to spend,” said Snider, who recommends that clients spend a few thousand instead “to freshen it up.” He added that sometimes brokers will even take the cost of staging out of their commission because they know it will sell the place.
Last year, Snider took over a listing for a co-op on East 72nd Street that despite a reasonable asking price of $615,00 had languished on the market for six months. It went into contract the weekend after staging and closed for $5,000 over ask. “Without staging, you’re just another Upper East Side co-op with no view,” he said.