Sellers get creative: Desperate to unload their homes, sellers are trying everything from auctions to essay contests

Two years ago, Ray Sinclair and his wife, Sharon, put their Yachats, Ore., beach house on the market -- just in time for the housing slump. "Everybody who saw the house loved it, but nobody could afford it," says Sinclair, who listed the 1,967-square-foot house for $600,000, then dropped the price to $539,000. Still, the house sat.

Write a memorable 100-word essay, and this beach house in Yachats, Ore., could be yours. Credit: Ray Sinclair

Then, while lying awake one night worrying about the house, Sinclair got an idea: Why not give it away in an essay contest? If enough people paid the entry fee, he’d earn market value. “At that point I decided anything was better than having the house just sitting there,” he says.

To be sure, many sellers are coming to the same realization these days. With home prices still falling and the supply of houses on the market still increasing, sellers are looking beyond traditional sales tactics in an effort to distinguish their homes from a sea of others. They’re auctioning off houses to the highest bidders, giving away freebies and offering personal loans.

Cyberhomes.com asked the experts to weigh in on what methods work for sellers—and whether any of them represent a good deal for buyers.

Essay contests: Roses are red, your house is blue …

Sinclair made sure he did everything by the book. He hired an attorney, formed a corporation, recruited three independent judges and launched a website, www.win-this-home.com. Five months and $40,000 later, the contest commenced on January 2.

Entrants have until the end of April to pay $200 and submit an essay of 100 words or less about why they should own this house. Ideally, the Sinclairs will collect 3,000 entries -- enough to cover the value of the house and the fees associated with the contest. If they don’t make that target, the Sinclairs will refund the prize money, all of which is in escrow.

As of early February, the couple had a little over 360 essays. But Sinclair is hopeful that things will pick up. "We had 40 people come see the house on Super Bowl Sunday," says Sinclair. "Word is getting out."

Advice to sellers: The process takes a lot of work, and money, up front with no guaranteed success. "But I could see people getting into something like this," says Robert Irwin, author of The Armchair Real Estate Investor. Just be realistic about your home’s appeal. If it’s a historic gem, it may inspire essayists. If it’s a cookie-cutter home in the suburbs, not so much. (Bottom Line: A lot of work, with uncertain outcome.)

Advice to buyers: Make sure the owners have set up a legitimate contest. Then, if you can part with the entry fee and pen an essay for a house you don’t need but can afford to maintain, go for it, says Irwin. “Heck, I might send in my own essay.” (Bottom Line: There is a lot of upside here. If you understand all of the caveats, go for it!)

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