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Steve McLinden, the Bankrate.com Real Estate AdviserHome sale price often hinges on need to sell

Dear Steve,
I must sell my home. It's currently priced competitively with like homes at $189,900. My bottom line selling price would be $179,000. However, my agent tells me not to lower my price. Is this good advice, considering I must sell quickly?
--Joan

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Dear Joan,
Lacking other details such as your local market's condition, the size of you current mortgage payment and your motivation to sell (for instance, whether you've bought another home already), it's a little hard to tell. The market is soft across most of the U.S., and people are regularly dropping prices 5 percent or more, as you propose, just to close deals. So your agent must be awfully darned confident that your house is already priced to sell.

At first glance, you might suspect that your listing agent wants to hold out for a higher price just to increase her commission, which is not a rare occurrence in the real estate biz. But when you put pen to paper, the agent's 3 percent cut of the $10,900 discount you're contemplating would only amount to $327 -- hardly enough to risk what's obviously a desirable and sure-fire listing, at least in your agent's eyes. Thus, we might assume your agent knows the local market well and is looking out for your interests.

But all this begs another question: Has your house shown well and shown often? I ask because there's a general sentiment among agents that if you don't get an offer after 10 to 20 showings, then you may need to think about lowering your price.

Above all, you have to ask yourself what you have to lose by waiting longer to sell. If there is really an acute time pressure, then by all means you can instruct the agent to lower the price. In the end, dropping your price and selling quickly could save you a couple of sizable mortgage payments.

But before doing that, you and your agent might consider a few other options. Instead of lopping nearly $11,000 off the sales price, you might first try offering a bonus of $2,000 or more to a buyer's agent who can produce a buyer by a certain date. Sometimes that extra carrot will stimulate additional showings and attention. Or, you could offer to pay closing costs to sweeten the deal for the buyer -- anywhere from a $2,000 to $5,000 credit, for example.

Remember, you are calling the shots here, so your agent is working for you and should help you tailor a strategy to suit your needs, which are obviously immediate.

Here's hoping for a quick sale.

To ask a question of the Real Estate Adviser, go to the "Ask the Experts" page, and select "buying, selling a home" as the topic.

Bankrate.com's corrections policy-- Posted: April 8, 2007
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