Your house might well have been worth that higher price in the market's heyday, but you may be handcuffing yourself with a pie-in-the-sky price. If you start out high and keep reducing, you create a perception that something's wrong with your home. Realize that the best time for a viable offer is usually during a home's first 30 to 45 days on the market.
As for your friendly neighbor agent, unless she's a star producer and unimpeachably objective in her screening process, the strategy of hiring someone on your block is fraught with unnecessary risks. To begin with, neighbors tend to want to "protect" their block from what they perceive as unsavory types, and a next-door agent may try to weed out buyers based on racial or other personal biases. Who knows? Such a potential conflict of interest may have already cost you a sale.
Your real estate agent may well have offered you a reduced commission as a "favor," which is fine until you realize your home may not exactly be at the top of her fiscal priority list when she is pondering how to pay her bills. Or it just may be that your type of home is not her specialty, or she normally operates in another part of town, or both.
All told, friends, neighbors and relatives tend to make for risky personal contractors or business partners. A seller such as you, after all, has to be able to fire your agent if results dictate. That led to awkward complications in your case. For your sake, you'll probably have to do the deed anyway because after nearly two years, it looks like it's time to move on.
Since it's your home and your valuable asset at stake, go with the absolute best person for the job this time. Interview three agents and be frank about the challenges you have faced and ask what strategy would be best to pursue for a timely sale. Ask each agent what makes them special or different in their field, what percentage of listings they have sold in the last few years and how often you can expect to hear from them. Ideally, the agent you choose will have been successful in selling homes in your part of town. Tell the agent that practicality in pricing is a priority. Price to the market, not to an ideal, and make your home's layout -- dining room and all -- apparent yet appealing in marketing literature. Ask prospective agents a few questions about strategies to stage your home and how to emphasize its best features.
For your sake, here's hoping you aren't too close with that neighbor agent that you're going to "let go." You may be facing a scowl instead of a wave as she drives past you from now on. And readers, if you have any doubts about hiring a neighbor, friend or family member to represent you, you already have your answer.