With the median price of a new home at an all-time low, and one million more houses on the market nationwide today than there were last year, homeowners are going to any length just to get properties off their hands.
Home owners and home builders are pulling out the stops with givebacks and giveaways -- everything from cupcakes to flat-screen TVs and cars.
Let Them Eat Cupcakes
Cindy Schwanke has been trying to sell her suburban Los Angeles home for nearly nine months.
"We never really thought we'd have a problem selling," Schwanke said. "None of our neighbors have had a problem selling. Our relatives have never had a problem selling their homes. So we didn't anticipate this at all."
To make matters worse, Cindy and her husband have already bought a new house. They are now paying two mortgages.
Last summer, Schwanke quit her job as a pastry chef to devote all her time to marketing her old house, where she waits armed with desserts ready to snare a prospective buyer.
"I try to bring people in," she said. "I bake cupcakes for them. I offer them water, and I do whatever I can to make it a pleasant experience for them."
But in many cases cupcakes alone won't cut it. On the West Coast home sales have plummeted over the last two years. Even worse, many buyers who've bought homes are now backing out of their contracts.
"People are so terrified of the economy," said Steve Johnson, director of Metrostudy Southern California. "They're seeing all this press. They're hearing it's a bad time."
In an effort to find buyers, homeowners also are cutting their prices coast to coast, from modest homes to the very expensive. One four-bedroom house in the exclusive Los Angeles suburb of Pacific Palisades was originally listed at $2.45 million; the price has been cut three times.
"The house is listed at $1.995 [million] and you can see it has this wonderful indoor/outdoor feeling. It has this great view it has this ocean view," the home's real estate agent Sarah MacDonald told ABC News. "It was ambitiously priced at first, but we soon found out it was overpriced and the market wouldn't support that price."
MacDonald said that a year ago things would have been different.
"I would guess that in the first two weeks we would've had a five or six offers and then we would have picked the best financing, the best money down and then we would have had 30 days escrow so within 45 days this house would've been sold," she said.
MacDonald's advice to sellers is to be patient and consider lowering the price.
Buy Your Buyers
If that doesn't work, try giving gifts.
In California an astonishing number of sellers are offering so-called incentives, and they're not just talking about cupcakes.
"It doesn't get very exciting when you're talking about better financing or a better price," Johnson said. "It gets very exciting when it's a flat screen TV or a vehicle that's thrown in."
Last year, one four-bedroom home in the Hollywood Hills would have sold immediately, but in the last year home sales are down an astonishing 22 percent in the West, so sellers are having to get extremely creative.
The owners of the home were offering to pay the first six months of mortgage payments for the buyer, and now are offering to give away a free car valued at $17,000.
Prospective buyers of a $5 million Bel-Air home are being offered a free two-year lease on a Maserati Coupe. The home was on the market two months with no offers.
Why don't those owners just lower the home's price?
"When you're walking somebody through here and you see a car here, it's still more exciting than saying, 'I have a $24,000 price reduction or a $50,000 price reduction,' when you see a car here with a bow on it," one realtor said.
After throwing in the Maserati, the owner quickly received three bids.
"Consumers are really into the transaction, the excitement of the transaction," Johnson said. "And here in California, if you can kind of sex up the deal, it really makes everybody happy."
New home developers also are feeling the heat, offering big incentives like signing discounts of up to $150,000 and luxurious kitchen and bathroom upgrades.
"They are definitely in the 'let's make a deal' mode," Johnson said.
Centex Homes even employs actors who play the role of happy homeowners having a birthday party during open houses.
"It's really fun watching people sing 'Happy Birthday' together," said Amanda Larson, a Centex Homes marketer. "It's one of those American things. Like owning a house."
"No matter what the market does, one thing is always going to hold true," said Centex's Jim Garfield. "People want to own their own homes."