Home sellers trying it all to hook choosy buyers

Jennifer Nilssen wants to sell her Ballard condominium -- fast.

She set her asking price about $20,000 below that of comparable condos in her building. She's offering to finance 10 percent of the purchase price. She will give the buyer's agent a 4 percent commission -- up from the traditional 3 percent. And she'll even throw in the furniture.

"I just wanted to fire-sell it," Nilssen, an agent with TEC Real Estate, in Bellevue, said Thursday. "I'm not living there, so I've got two mortgage payments. And I thought about renting it out, but I'm not sure the rental market will support it."

Nilssen might be more aggressive than many sellers, but she's definitely not alone in offering such incentives to compete with an increasing number of home sellers chasing a dwindling pool of buyers.

A year ago, buyers regularly bid above asking prices, waived stipulations such as inspections and used escalator clauses, which raise offers over competitors' bids up to a set ceiling. Now, good homes in nice neighborhoods with realistic asking prices still can get multiple offers, but many sellers put more time and money into fixing them up, offer more incentives and accept more conditions, including offers contingent on sale of another home.

These days, it would take twice as long to sell the current number of homes on the market in Seattle and King County as a whole at their current sales paces than it would have a year ago. Seattle had 50 percent more homes on the market in September than a year earlier, while the countywide increase was nearly as large. Pending sales, which can be the best indicator of recent market activity, declined by more than 25 percent in Seattle and 30 percent countywide.

That's why sellers are working harder to stand out.

The seller of a Greenwood home is offering $15,000 toward closing costs to a buyer who brings in an acceptable offer by Oct. 30. The buyer of a Ballard condo would get a $5,000 buyer bonus, plus an extra $1,500 for the buyer's agent. A Squire Park townhouse comes with $2,500 to upgrade windows.

But presentation, not incentives, is the most important factor in getting a house to sell, said Susan Peters, an agent with RE/MAX Mutual Realty, in Ballard.

Having a home well prepared and well photographed used to make the difference between selling at one price and selling for a bit more, said Peters, who stages her listings for free. "Now if you don't have these things done, you're going to be lucky to get it sold at all."

Rob Smith, an agent with Windermere Real Estate, recently listed a Snoqualmie Ridge house that the owners tried to sell on their own for five months. He arranged refinishing of the wood floors, new carpet and paint, and had the home staged. It sold in 26 days.

"The houses that are selling are the ones that are impeccable and priced right," he said. "It used to be maybe you could get by with one or the other."

Staging -- preparing a home for viewing by decluttering it or accessorizing it with artwork or furniture -- helped sell homes that had languished on the market, said Jan Sewell, a Windermere agent who owns a home-staging business. "It's totally more important right now."

Sewell said her business hasn't picked up from a pace that was already busy before the market slowdown, although longer selling times are affecting it.

"I've been having to buy tons of furniture because things are sitting longer," she said.

Smith also is hosting more open houses, following up more with agents whose clients tour homes he's listing to offer alternatives if necessary, and making sure from the outset that sellers are being realistic.

"If they think their house is worth a lot more than it is, it doesn't really make sense for us to work together," he said. "Everybody just gets frustrated."

	Mike Kane / P-I
Designer Eric Ingram of Jan Sewell Design arranges decorative flowers in the living room while staging a new home in the new Rainier Vista subdivision in south Seattle on Friday.

To help bridge the gap between sellers and buyers, Windermere Mortgage Services dusted off its Step Rate Mortgage program, under which sellers can buy down a buyer's interest rate for the first two or three years, lowering the new owner's initial monthly payments. Buying down the interest rate on a $500,000 house three percentage points the first year, two the second year and one the third year, for instance, would cost the seller less than a $20,000 reduction in the price and create a lower initial payment.

Serana, a new condo building in Lower Queen Anne, is offering $8,000 toward a buy-down of two percentage points in the first year and one in the second through its preferred lender.

Meredith McDonald recently found the house she wanted in Phinney Ridge, but she and the sellers were about $30,000 apart on the price.

"I knew I couldn't get to the price point they were asking for," McDonald said on Thursday.

That's when her mortgage broker suggested a buy-down of two percentage points in the first year and one in the second. The arrangement cost the sellers about $8,000 and allowed McDonald time for pay raises and to put some money away before the rate increased.

"It's nice to have that time to plan," she said.

McDonald needed nearly 90 days to sell her former home, a condo in Greenwood, and ended up cutting the price by about $15,000.

Leslie Williams, president of Williams Marketing, which works with condo developers, said the prices on her projects have not been cut.

"There's no question that they're not raising them anymore," she said, adding that sellers who lowered their asking prices were asking for too much to start with.

One Williams project, a Federal Way condo-conversion, is contributing to buyers' closing costs, she said.

"This market is OK. It's not fantastic," Williams said. "It was really nice there for a while to have it easy."

Peters thinks the real estate world will "be turned upside down" in the next few years. He sees it dividing into two camps: discounters such as Redfin -- a Seattle company that provides scaled-back services, then rebates a portion of the commission; and full-service agents who work with sellers one to two months in advance of listing a property to get it ready, stage every home, hire professional photographers and go all out in marketing.

"We've enjoyed a pretty high standard of living without having to really do things differently, and I think those days are over," she said. "We all have to really work for our money now."