Houses in parts of the Twin Cities are nearly selling themselves, but Kari Michael isn't twiddling her thumbs. She and other Twin Cities house stagers are as busy as ever.

"Home buyers have become more savvy and are not going to buy any house even if it is a tough market for them," she said. "They want value for their money."

Blame HGTV. Home buyers are watching house-centric reality TV shows and they will wait for a house with the features they see on those shows.

That's one of the reasons home sales in the Twin Cities metro have been falling even though demand is off the charts. Data released Tuesday by the Minneapolis Area Association of Realtors showed that home sales across the 13-county metro area declined 2.6 percent in July compared with the same month last year.

Sales were hampered by a lack of supply rather than a lack of demand. Bidding wars lifted the median price of those sales 5.9 percent to $254,000 — the highest for any July. "Buyers want to buy, but they won't buy if they can't find a house that works for them," Michael said. "It needs to look like it was in a magazine."

During the month, just 7,227 new listings hit the market, 3.9 percent fewer than last year. With houses still selling quickly, by the end of July there were just 12,407 properties on the market — 18.3 percent fewer than last year and the most significant inventory decline in five months. Pending sales, an indication of future closings, fell 1.2 percent to 5,661.

When Michael started Kariel Staging & Decor nearly 15 years ago, she was a single mother who saw the need to have homes staged for sale in a high-end way at a low cost. One of her earliest champions was Bill Cooper, the former head of TCF Bank, who saw proper staging of foreclosed homes as a way to sell them quickly.

Today, foreclosures are virtually nonexistent and houses are selling in near-record time. Last month, houses in the Twin Cities metro sold in just 44 days on average, nearly 20 percent faster than last year. At the current sales pace there are only enough houses on the market to last 2½ months. The market is considered balanced when there is a five-month supply.

As a result, Michael and other stagers have shifted their focus from spiffing up those hard-to-sell houses to satisfying the demands of buyers with increasingly high expectations. In some cases, they perform contracting duties for sellers who want even more improvements done to their houses.

Karen Galler, owner of Showhomes Minneapolis, said that even though there's an inventory shortage, buyers still have trouble envisioning the potential in an empty houses. "This is the swiftest market I've been in," she said.

A new survey by the National Association of Realtors said that 77 percent of buyers' agents said that staging a home made it easier for a buyer to visualize the property as a future home, and 62 percent of sellers' agents said that staging a home decreases the amount of time a home spends on the market.

That's especially true for move-up houses, which until recently have been a more difficult sell — especially those that haven't been updated recently. But as sales — and prices — of starter houses has increased, demand for move-up houses is on the rise and the upper-bracket market is posting strong gains. Last month, pending sales of houses priced from $350,000 to $500,000 were up 15.2 percent, while pending sales of houses priced at more than $1 million increased 25 percent.

Galler and Alex Dzurik, an agent from Keller Williams, recently spent the day moving furniture into an upper-bracket house in Eden Prairie. Galler refinished the wood floors, and stained them a bit darker to give the house a more updated style. And they filled the main living rooms in the house with new furniture and accessories to give would-be buyers a sense of how to arrange the space.

"When staged with new and trendy furniture that appropriately fills the space, the home naturally feels more updated," said Dzurik. "Buyers are willing to pay a premium for turnkey homes. There are less than 10 seconds to catch a buyers attention when they are viewing a property online."

Jim Buchta • 612-673-7376