In a neighborhood flush with short sales and foreclosures, Patrick and Linda Rossitto are trying to sell the old-fashioned way.
It's not going well.
"It's been a nightmare and an eye opener for us," said Linda Rossitto, who recently became disabled and can't walk up the stairs in her Antelope home.
For the past three years, the Sacramento real estate market has revolved around distressed sales, which, according to MetrolistMLS, comprise more than 60 percent of the region's current listings.
Pushed to the background are homeowners like the Rossittos. They didn't buy in the boom. They have equity they don't want to lose. They want a traditional sale.
Now they're competing with banks eager to get a foreclosure off the books or neighbors pursuing short sales who care little about what their home fetches, as long as the lender eats the loss.
Traditional sellers have a few significant advantages: They can offer a much quicker closing with far less hassle, and their homes are often better maintained than foreclosures.
But homeowners with equity and a payment history are often reluctant to price their houses low enough to compete with distressed properties.
"Pat and I aren't going to give our house away," Linda Rossitto said. "We'll take it off the market and I'll crawl up the stairs."
The Rossittos bought their two-story home about 20 years ago, well before the housing boom brought thousands of new residents to Antelope.
Today, after the bust, Antelope is one of the region's focal points for distressed sales. About 80 percent of the home listings in the northern Sacramento County community are foreclosures or short sales. "Flippers" bought by investors at auction make up a significant portion of the remaining 20 percent.
All of which isolates the Rossittos. Circumstances, though, have forced their hand.
Linda Rossitto fell down the stairs about a year ago, injuring her back and tearing muscles in her arm. In October she had a stroke. Recently she lost her balance and almost toppled over the second-floor banister.
She now crawls up and scoots down the stairs. The couple want to move into a handicap accessible home where Linda can maneuver with her walker.
The Rossittos put up their 1,900-square-foot home for sale in November for $250,000. After getting little response at three open houses, they cut the price to $240,000.
That's about $125 per square foot. The average listing price for foreclosures and short sales in the Antelope area is $99, according to MetroList MLS.
'Everything is a comp'
Homeowners like the Rossittos aren't likely to find buyers until they drop their prices significantly, said Patricia Webb, a real estate agent with Keller Williams Realty.
"Everything is a comp," said Webb, referring to the list of prices on comparable homes that buyers see when shopping for a new home. "It's bank owned or it's a short sale, it's still a comp."
Webb works only with homeowners who are pursuing traditional sales. Every few weeks, she gets a list of houses languishing on the market. She calls everyone on the list and asks them, "How's it working out for you?"
She often tells them she'll help them sell, but they need to lower their price.
"I talked to a girl from Antelope today," Webb said. "Her home is priced at $240,000. I said, 'Your home has been on the market for three months!' The market is screaming at you."
When homeowners pursuing traditional sales lower their prices to foreclosure levels, they often get traction, though a quick sale can still be elusive.
George Lydon is a case in point. Lydon, who recently lost his job, listed his 2,000-square-foot Antelope home for $280,000 in July. Then he sat back and listened to the crickets chirp.
"We started too high," Lydon said. "It was a bad choice on our part."
Lydon and his then-wife had owned their home for 17 years, and had equity, so they needed to pursue a traditional sale. A divorce and a child heading to college pushed them into the market.
They lowered the price to $220,000 and finally got an offer, which just fell through. The home is back on the market now at $215,000.
Traditional home sellers like Lydon can get a small premium on their homes in relation to distressed listings, but they shouldn't get carried away, several real estate brokers said.
The median price for traditional sales in Antelope during the past several months was about 5 percent to 15 percent higher than the median for distressed sales, according to MetroList MLS data from the Sacramento Association of Realtors.
Buyers will pay a bit more because "they don't want to get involved in the short sale process," said George Brown, who runs Thompson-Brown Real Estate, one of Antelope's largest firms.
While his firm sells all kinds of homes in Antelope, Brown also buys distressed homes himself, fixes them up and sells them for a profit.
He estimates that 20 percent to 25 percent of traditional sales in Antelope are made by such flippers.
Another investor, Richard Kooi, puts the figure closer to 50 percent.
"We fix them up and we definitely think we have a better offering than a short sale or REO (real estate-owned)," said Kooi. He's selling a 2,450-square-foot Antelope home for $260,000, or about 6 percent higher than the average asking price per square foot for a distressed sale.
Investors like Kooi offer tough competition to homeowners like the Rossittos and George Lydon. They supply the ease of a traditional sale, and they've often increased the appeal of their properties by making upgrades.
A seller just above water
Traditional sales are rarer today because so many people owe more than their homes are worth.
For those with a lot of equity, pursuing a traditional sale is a no-brainer. But it's tougher for those with just a shred of equity left.
Cathy Ruiz, an agent with Re/Max Gold in Roseville, is working with a home seller in this sort of jam. Ruiz has spent the past 120 days trying to sell a home on the 7600 block of Bogan Way in Antelope. She took on the property after another agent spent 84 days trying to sell it.
The Bogan Way property is on the market for about $159,000. Someone offered $152,000. Even that relatively minimal difference, however, was too much.
The owner owes around $150,000 on her loan. With closing costs of around $10,000, even at the asking price the owner will need to come up with a couple of thousand dollars out of pocket.
"It would be a short sale if it went too much lower. That's the problem. She can't go real low," Ruiz said.
A bank probably wouldn't even approve a short sale because the owner has a stable job and isn't in default, Ruiz added.
Some real estate experts said they expect traditional sales to become more attractive as homebuyers tire of the hassles that go with short sales. Others said short sales could become more prevalent as banks streamline their operations and try to avoid ever-increasing paperwork involved with foreclosures.
None of which is likely to help Patrick and Linda Rossitto anytime soon. They're within easy walking distance of more than 25 distressed sales, most of them priced lower than their own home.
Seeing the "For Sale" signs at those houses and knowing what it means for her family's prospects is a steady source of frustration for Linda Rossitto.
"It's their fault they bought a home they couldn't afford," she said. "We're just hardworking, middle class, American people who can't even sell our house."