Home Staging and Property Flipping – Home Staging for Investors

Property Flipping is nothing new in Spain, as the concept of buying a cheap property, renovating it, and selling it on for a profit has always existed. However, this investment model, hugely popular in the US, is recently been gaining more and more traction in this country. Popular TV programmes such as Flip or Flop and others like it are setting trends among small-scale investors, while the number of professional investors dedicating themselves fully to this type of business is also on the rise. There are even agencies offering this model to their clients in exchange for a percentage fee on the profits. The service usually includes a market study, purchase management, renovation coordination, and the eventual marketing of the property. There’s no doubt, property flipping in Spain is here to stay.

Flipping is a business that can generate significant profits in a relatively short period, provided the investment is made with careful consideration of the current market and associated costs. To ensure profitability, flippers often use the so-called “30% rule”. This means that for the operation to be profitable, the final sale price must be at least 30% higher than the total cost of purchase and renovation.

To give an example, if the average price of a two-bedroom flat in Barcelona is around €300,000, the total investment should not exceed €210,000. Therefore, if the renovation costs €40,000, the investor should pay no more than €170,000 for the flat. Securing such low prices is usually only possible when the property is in a very poor condition or the owner urgently needs to sell due to personal circumstances. After taxes and other fees, the real profit margin tends to sit around 20% of the initial investment, which represents a good return while leaving room for unexpected costs or delays.

To carry out a successful flip, it’s essential to find the right property – commonly referred to as an “ugly duckling”, or fixer-upper. This is a property that, due to its poor condition or lack of proper marketing, goes unnoticed on property portals and ends up being listed significantly below market value.

It’s important to note that not all cheap properties are good investments. Experienced flippers seek out genuine opportunities in desirable areas, close to public transport, schools, and shops. They avoid, where possible, top-floor flats with no lift or ground floors with very little natural light. No matter how old or run-down a flat might be, if it has good bones, the renovation can focus more on aesthetics, which requires a smaller investment and therefore offers a greater chance of a good return.

With the rise of flipping in the Spanish property market, the quality of projects has also improved. Basic cosmetic upgrades are no longer enough – buyers now expect a full renovation, with design playing a leading role. This doesn’t mean the finishes have to be top-of-the-range, as it’s crucial to keep renovation costs under control. However, it is essential to enlist the services of a professional home stager to add the final touches to the project.

Home staging involves preparing a property to improve its position in the market and facilitate its sale using property marketing techniques. No matter how well-renovated a home may be, putting it on the market without furnishing can be a costly mistake, reducing its perceived value by up to 20%. Most people can’t visualise how furnished spaces would look, and the lack of visual references often makes rooms seem smaller than they actually are. For instance, an empty bedroom might appear small at first glance, but once furnished with a double bed and bedside tables, it’s suddenly clear there’s room to spare.

Furnishing an entire property can be a considerable expense, and as mentioned before, every euro spent on the project must be carefully monitored. This is where low-cost home staging becomes the perfect ally for investors. The home stager prepares the property using a mix of cardboard and real furniture, along with all the decorative details that bring the home to life. The furniture and décor are rented for just a few months at minimal cost, allowing the property to appear complete and stylish – not only for the photos, but also for viewings.

Some investors raise the concern that cardboard furniture may look cheap, but with quality staging, it often goes completely unnoticed by buyers, who frequently mistake it for real furniture. This service is the ideal complement to property flipping, allowing for a high-quality presentation while keeping to a tight budget.

Home staging, already well established in other countries, is becoming increasingly relevant in Spain, and many professionals in the property sector now recognise the important role it plays in marketing a home. But where the greatest synergy may lie is in collaboration between home stagers and investors. The latter understand the need to invest in order to achieve returns, and by working with home stagers, they partner with professionals who understand the steps required to accomplish every investor’s goal: a quick sale at the best possible price.