HOW TO SELL YOUR HOME WITHOUT DROPPING YOUR PRICE

When your home is marked down from its original price, it's a sure sign that your marketing plan failed. Not only have you missed the critical first two weeks when buyers and real estate professionals are most interested, but there's no way for your home to compete with other homes that are better priced.

No one wants to waste time trying to deal with an unreasonable seller, so lowering the price may not help as much as you may think. Buyers may think something is wrong with the home, or they may decide that there's room for even more discounts. Real estate professionals won't get excited when your agent relists your home at a lower price because it's not a new listing.

If you're really ready to sell your home, don't test the market. The best thing for you to do is to price it right in the first place and then sell as close to the original asking price as possible. For the best results, price your home at current fair market value -- not where prices were in 2005, or where they might be in 2015.

Current fair market value means your home favorably compares to recent listings and closed sales of homes most similar to yours in size, finishes, amenities and location. It also means your home is on target with price trending. If homes are dropping in price in your area, you may want to set your original price under current fair market values in order to generate more interest from buyers. If prices are trending upward, stay current - don't price ahead. That only works in the strongest sellers' markets when banks are more comfortable about rising prices.

Next, make sure that buyers see your home in the best light. Among real estate professionals, the most important considerations is how your home looks from the curb and how it looks online. First impressions require that you spend particular time and attention on curb appeal, from keeping your walks and drives swept, to painting the front door a fresh new color, to putting out a new welcome mat.

Photography can be your home's best selling tool when it's done correctly and professionally. Stage the rooms that will be photographed by removing clutter. Fluff the pillows, clear tabletops and countertops, and remove the dog's water bowl and your children's toys out of the viewfinder. Take a few digital shots and look for flaws - the rumpled bed, the wastebasket full of paper, or the closet bulging with clothes. Once all the flaws are removed, you're home is ready for the professional photographer who has the right lighting and equipment to help you market your home.

In homeselling, less is more. You want the home to come forward and your belongings to fade to the background. If you have too much stuff, put the excess in storage. As little as $50 to $250 for short-term storage could make the difference in the buyer's offer price.

When buyers come to your home, they will be looking for flaws, so make sure the little details are done, especially small repairs. The less that needs to be fixed or replaced, the better maintained and the more move-in ready the home appears to the buyer.

Buyer-friendliness is a factor that can't be underestimated. If you want a certain price for your home, make sure to give the buyer something extra to make it worth paying full price. Offer to pay closing costs up to a certain amount, or offer to leave the washer, dryer and refrigerator.

It's not just the home that needs to be attractive. As the seller, you're part of the whole package. You should appear buyer-friendly, just as your home should appear move-in friendly.

A home that is priced to reflect current market conditions and shows well in person and online will always sell for more than homes that aren't maintained and marketed as well.

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Timeline for closing a home sale

Several factors can delay approval process

Some home-sale transactions close quickly, while others can take months. Two significant factors that affect most home sales are inspections of the property and financing the purchase.
Inspections should be done within the first couple of weeks after the offer is ratified, i.e., accepted by both buyer and seller. Usually, the day after ratification is day one of the contingency and closing time periods. This may vary from one location to the next.
When transactions fall apart soon after ratification, the cause is usually something discovered during the buyer's inspections. It's a good idea for sellers to get presale inspection reports so that the buyers have as much information about the property as possible before they make an offer.
Most home inspection reports make recommendations to consult other specialists such as a roofer, furnace contractor, drainage specialist or engineer. Few sellers have these additional inspections done. Even if they do, the buyers might want a second opinion.
Inspections are also somewhat subjective. One inspector might say a roof needs to be replaced; another might say it has a few years of life left as long as it is properly maintained. Transactions fall apart because the buyer and seller can't come to an agreement on inspections, which means the sale doesn't close, the house goes back on the market and the buyers renew their home search.
If the inspection issues are worked out satisfactorily, the next major hurdle that could delay your sale, or crater it, is the loan contingency. Cash buyers bypass this rigorous process; however, they do need to provide the sellers with evidence that they have sufficient liquid funds to close the sale.
All-cash deals can close whenever the buyers and sellers agree, after all inspection issues are resolved. Closing can occur in a week or two. Some all-cash buyers include an appraisal contingency in their contract to confirm that they're not paying over market value.
In this case, it would take longer to close because an appraiser would need to visit the property and work up an appraisal report. If the property didn't appraise for the purchase price, the buyer might be able to back out and have the deposit returned.
Both buyer and seller would start all over again. However, if they negotiated a resolution, the sale could close quickly and would take far less time than it does to close a sale involving a mortgage.
HOUSE HUNTING TIP: Purchase contracts include contingencies and time periods for them to be met. To avoid having to ask for extensions, make sure that the time periods you request are reasonable. An extension might not be granted if the seller has a backup offer for a higher price.
Buyers should get preapproved for the financing they need to close a home sale before their offer is accepted. This way, they are assured of what they can afford to pay. Preapproval can cut a few days off the loan approval process.
Loan approval can go relatively quickly if you present all required documentation promptly and your financial situation is not complicated. It can be more time consuming for buyers who are self-employed or are using other than W-2 income to qualify.
Part of loan approval involves an appraisal on the property by a licensed appraiser. This can slow the process down depending on the lender, how backlogged they are and the loan amount. A large loan amount can prompt the need for two appraisals, which adds more time to the approval process.
THE CLOSING: If you're buying in an area where homes are selling quickly, it may take 35 to 45 days from contract acceptance for final loan approval and closing.

Financial advice for women that goes beyond the basics

Book Review: 'The Seven Pearls of Financial Wisdom: A Woman's Guide to Enjoying Wealth and Power' By Tara-Nicholle Nelson

Book Review
Title: "The Seven Pearls of Financial Wisdom: A Woman's Guide to Enjoying Wealth and Power"
Author: Carol Pepper and Camilla Webster
Publisher: St. Martin's Press, 2012; 352 pages; $25.99
A number of notable personal finance experts have made attempts to share their knowledge, insights and experiences on money matters with women-friendly money books and courses. However, many of these are relatively narrowly focused on subjects like budgeting, investing, getting out of debt, real estate, or building a career or business.
Now there's a new entree into this genre by former Rockefeller money manager Carol Pepper and Forbes journalist Camilla Webster: "The Seven Pearls of Financial Wisdom: A Woman's guide to Enjoying Wealth and Power."
I read a lot of finance, self-help and other books from similar genres, and spend much of my time exploring and creating multimedia resources in the same areas. Against that backdrop, "Seven Pearls" at first glance came off as overly simple, and lacking, mmm, pizzazz. What you won't find in this book is a bunch of charts and graphs and links and bullets and short-attention-span gimmicks or cutesy phrases and acronyms. The paragraphs can run long, and the voice is less girlfriend-ey and more straight shooter.
What you will find in "Seven Pearls," however, is 300 pages of straightforward, substantive, visionary, step-by-step guidelines for creating a truly prosperous life, including clear advice for managing your money, business, career, family and romantic relationships, and professional advisers toward that end.
Pepper and Webster don't coddle or infantilize readers, nor do they assume that the average reader is mired in financial desperation or struggle just to believe they deserve to flourish. In fact, many women may not be emotionally ready to receive and execute on the advice it contains. Some will need to take a course like Conscious Bookkeeping or work through a book like Karen McCall's "Financial Recovery" or Julia Cameron's "The Prosperous Heart" before they can truly appreciate and act on the simple but serious wisdom contained in "Pearls."
Pearls provides Pepper and Webster's opinionated, yet ego-free, guidance on a wide-ranging, but interconnected, set of topics including:

• developing a set of investment guidelines for your portfolio.
• starting and managing a business.
• finding, vetting and selecting the right spouse.
• raising wise children.
• managing your wellness with DNA testing.

What I know from working with many women who want to use real estate to build their net worth and family futures is that what causes some to hesitate to take responsibility for growing their finances is the fear of the unknown territory of prosperity -- the fear that they will fail on the nuts and bolts of managing the more complex taxes, legal structures, adviser teams, business plans, financial statements and such that they might face if they do find financial success.
"Seven Pearls" neatly obliterates such fears and concerns, providing a nuts-and-bolts outline and action plan for women who do earn a good income -- and those who plan to in the future.
Pepper and Webster provide hundreds of pearls of financial wisdom in seven areas of their lives, carving out a vision for a prosperous life by doing some touching, some deep dives and lots of clear, actionable recommendations in the areas of:
1. Wealth building: business, career, investments and retirement planning, including how to manage your own emotions to avoid common (and costly) business, tax and investment mistakes, and select and manage your team of advisers.
2. Romance and marriage: managing the costs incurred while dating; financial red flags that prospective mates might raise; and how to handle the financial negotiations and disclosures that are necessary to minimize the too-common financial causes of marital strife.
3. Power: In this section, the authors coach women around many of the powerless beliefs and behaviors that happen so often even among educated career women -- like refusing to speak up for oneself or failing to -- and direct them to the image, social media and organizational tools for building and deploying their own powerful, personal brands, including everything from Twitter to seats on corporate boards.
Motherhood, crisis and loss, retirement and legacy building are also given intensive treatment in "Seven Pearls." For reader-friendliness, each chapter starts off with a set of questions that surface the problems that will be addressed within.
Many women now make more money than their husbands or prospective mates, yet many of these same women lack more than a basic understanding of financial tools. "Seven Pearls" is the first women's finance book I've seen that is tailored to take readers far beyond money crises and beyond the basics (though it does offer some crisis guidance and much advice for avoiding crises in the first place).
Rather, the authors effectively usher readers into a life season of wisely, assertively and knowledgeably using an advanced set of tools for managing their prosperity, their relationships and their futures, without fear, intimidation or unnecessary complexities.
In "Seven Pearls," Pepper and Webster offer successful women the logistics and structure on which they can construct a fully prosperous life, minus the fluff.
Tara-Nicholle Nelson is author of "The Savvy Woman's Homebuying Handbook" and "Trillion Dollar Women: Use Your Power to Make Buying and Remodeling Decisions." Tara is also the Consumer Ambassador and Educator for real estate listings search site Trulia.com.

Mortgage rates retreat again

Purchase loan demand jumps ahead of FHA premium increases

Mortgage rates eased slightly this week, and demand for purchase loans picked up last week to the highest level in months ahead of a scheduled increase in FHA premiums, surveys show.
Freddie Mac's weekly Primary Mortgage Market Survey showed rates on 30-year fixed-rate mortgages averaging 3.98 percent with an average 0.7 point for the week ending April 5, down from 3.99 percent last week and 4.87 percent a year ago. Rates on 30-year fixed-rate mortgages hit an all-time low in records dating to 1971 of 3.87 percent during the first three weeks of February.
Rates on 15-year fixed-rate mortgages averaged 3.21 percent with an average 0.7 point, down from last 3.23 percent last week and 4.1 percent a year ago. Rates on 15-year loans hit a low in records dating to 1991 of 3.13 percent during the week ending March 8.
For five-year Treasury-indexed hybrid adjustable-rate mortgage (ARM) loans, rates averaged 2.86 percent with an average 0.8 point, down from 2.9 percent last week and 3.72 percent a year ago. The five-year ARM hit a low in records dating to 2005 of 2.8 percent the week of Feb. 23.
Rates on one-year Treasury-indexed ARM loans averaged 2.78 percent with an average 0.6 point, unchanged from last week but down from 3.22 percent a year ago. Rates on one-year ARMs hit an all-time low in records dating to 1984 of 2.72 percent during the week ending March 1.
A separate survey by the Mortgage Bankers Association showed applications for purchase loans climbing a seasonally adjusted 7.2 percent during the week ending March 30 compared to the week before, to the highest level since Dec. 2, 2011.
"Applications for government loans increased by more than 10 percent over the week, for both purchase and refinance, likely spurred by borrowers seeking to apply before scheduled increases in FHA mortgage insurance premiums at the beginning of April," said Michael Fratantoni, MBA's vice president of research and economics.
For case numbers assigned after April 9, the Federal Housing Administration is increasing upfront mortgage insurance premiums on most purchase loans from 1 percent to 1.75 percent of the base loan amount.
FHA's annual premiums are going up 10 basis points, bringing the annual premiums for 30-year loans with loan-to-value ratios (LTVs) exceeding 95 percent to 1.25 percent, and 1.2 percent for others. A basis point is one hundredth of a percent.
FHA is also exercising its statutory authority to charge an additional 25 basis points in annual premiums for loans exceeding $625,500 effective June 11. Borrowers taking out loans of that size with LTVs above 95 percent will pay annual premiums equal to 1.5 percent, while others in that category will pay 1.45 percent.
When all the changes are in place, a borrower taking out a $200,000 loan to buy a house with the minimum 3.5 percent down payment will pay an upfront premium of $3,500 instead of $2,000. Annual premiums will be about $2,500, up from $2,300 a year before the changes.
A borrower taking out a $650,000 loan with the minimum 3.5 percent down payment will pay an upfront premium of $11,375, up from $6,500. Annual premiums for that borrower will be $9,750, up from $7,475 a year.
The premium increases are expected to boost FHA's mutual mortgage insurance fund by $1 billion, Federal Housing Commissioner Carol Galante said in a March 27 blog post addressing recent speculation about whether FHA will require a taxpayer bailout.
In another move to protect the insurance fund, FHA has also proposed new rules for seller concessions that are expected to have the greatest impact in higher-cost markets.
Under the proposal, the current 6 percent cap would be replaced by a maximum allowable seller contribution $6,000 for homes priced at up to $200,000, and at 3 percent of the sales price or appraised value for higher priced homes.
So under the new rule, the maximum seller concession on a $300,000 home would be $9,000 -- 3 percent of the home price -- half of the $18,000 allowed under the current rule. Comments on the proposed final rule were due March 26.
Fannie Mae and Freddie Mac have long limited seller contributions to 3 percent of the selling price, while the U.S. Department of Veterans Affairs allows 4 percent.

Mortgage help for homeowners with hospitalized child

Last autumn, Mortgage Bankers Association President and CEO David Stevens announced that his organization had created a new, nonprofit entity -- MBA Open Doors Foundation -- to be the umbrella operating unit for all the MBA's philanthropic activities.

The first charity the MBA chose to support was Spare Key, a Bloomington, Minn., nonprofit that helps families with critically ill or injured children by making a mortgage payment on their behalf.

"Helping families who are current on their mortgage but under incredible financial pressure while dealing with the hardest emotional challenge a parent could ever have is just the right thing to do," said Sarah Tinsley Demarest, executive director of the MBA's new charitable group.

"Parents want to be with their child, but they also want to hold on to their home. This gift allows a parent to do that, so they don't fall behind on their mortgage."

Demarest added, "It's for parents who are maxed out on taking leave from work. (It allows them to spend more) time with their child in the hospital."

Spare Key is a unique program founded in 1997 by Patsy and Robb Keech, whose son was born with a genetic birth defect and endured many hospitalizations during the first two years of his life. The Keeches were torn between wanting to be with their child in the hospital and going to work to maintain financial stability.

They chose to be with their son, so family, friends and strangers raised money during this time of crisis to pay the Keeches' mortgage so they wouldn't lose their home.

After their son died, the Keeches vowed to help other families in Minnesota who were in the same straits, and that was the start of Spare Key.

In 2010, Spare Key made 140 payments; in 2011, it made a record 201 payments.

Spare Key makes only one mortgage payment per family in a calendar year.

"We know, for families in more dire financial straits, this may not be exactly what they need, but for those families who need a bit more time in the hospital, who need a little bit more money in their pocket, who need that extra support, it's what we do," said Erin Werde, Spare Key's director of development and communications.

The one qualification to be eligible for Spare Key is that the a child must be in the hospital at least 21 out of the past 90 days, which means the charity serves kids that are at the more severe end of illness of injury. Of the children assisted, 47 percent had birth defects, 16 percent cancer, 13 percent prematurity, and 10 percent leukemia and accidents. About 75 percent of the Spare Key children are under 5.

In October, Werde got a call from a mother who lived in northern Minnesota, in a rural area far from a hospital. Her daughter, 6, had been complaining of headaches, which turned out to be brain tumors. Not only did the mother and daughter have to travel from northern Minnesota to Minneapolis -- they also traveled to Boston for treatments. Spare Key paid for a month's mortgage. As for the girl, she's doing much better.

Generally, the initial contacts with families are through hospital social workers. "We've been around the community long enough now that we have been able to form great relationships at the hospitals," Werde said.

"When a pediatric social worker sees a child has been in the hospital for an extended period of time, (the worker knows to) refer the families to Spare Key."

A family fills out an application, which can be obtained from the social worker or online, and then the Spare Key program director verifies all of the information: whether the family is current on the mortgage; length of hospital stay; and even that the house is actually located in the state of Minnesota.

Once those things are in place, a program committee reviews the application to double-check whether it fits Spare Key's criteria. When all that happens, Spare Key will make a mortgage payment with a cap of $1,200 directly to the mortgage company.

Perhaps the most controversial part of the Spare Key program is that it makes only one mortgage payment per calendar year. Also, the $1,200 cap may not come close to covering some families' monthly payments.

"We have discussed changes, but on our estimation there are about 1,000 families within our program parameters that we could be serving every year," Werde said. "There are other programs out there that will provide other types of support with bills. We highly encourage our families to seek other sources of support, as we are relatively narrow in our focus."

The MBA will follow the original Spare Key's formula and it, too, will stick to the "just one mortgage payment" formula.

What the MBA intends to do is support three new chapters of Spare Key. The first will be in the Washington, D.C., metro area, and the second two locations have yet to be announced. All should be open sometime in 2012.

"Our president, David Stevens, had heard about Spare Key some years ago and has been supporting it personally, as well as some of the other MBA members," Demarest said.

"Since the program was announced, we have had incredible outreach from our members wanting to be involved. We are trying to do this so the actual monies raised will go into mortgage grants and assistance, so we are looking where we have need and where we have members who will help us with the fundraising."

5 signs you're real estate-obsessed

I wanted to share this from Tara Nelson.....

Mood of the Market By Tara-Nicholle Nelson
Inman News®

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I recently had an instant message chat with a friend about one of her eventful -- and entertaining -- adventures in Internet dating. She suspected her date had been a classmate of mine in school, but I didn't recognize his name, so as we chatted I did some Internet investigating.
At one point during her hilarious retelling of the evening's events, my search results prompted me to interject, "Uh, did you Google this guy before your date?"
"No," she replied quickly, before saying much more slowly and with rapidly increasing dread, "Whyyyyyyyyy?"
The next moment was one of those scenes that would have been marked by a long, jagged record screech in the movies. "Excuse me?" I typed manically. "You got into someone's car without Googling them first???!!! That's just not safe." I went on.
She thought I was joking, but my knee-jerk reaction on this point is actually a symptom of a syndrome with which I've been afflicted for a few years now. I call it my "Google tic."
That just means that I have the uncontrollable urge to Google, well, almost any and everything.
It started in my work, writing and creating digital content. But it's gotten to the point that I Google every person I meet, am about to meet, or have recently met, every question that comes to mind or debate that comes up.
In fact, tapping into my Google history, I find recent searches for how old Clint Eastwood is; what it means if you keep getting shin splints; the last three medications and supplements that were prescribed and recommended to those close to me; how to tell if someone's really a jerk or just insecure; and the origins of almond milk.
I'm nearly equally captivated by other people's online search behavior. When I type my questions into the search bar, often I'll leave the last few words off, just to see what Google auto-populates into the form, as a peek inside what other searchers are looking for. The mix of highbrow and lowbrow things about which today's inquiring minds want to know is pretty entertaining.
Typing "how do you know if" is auto-completed with "a guy likes you?" and "a girl likes you?" But to end the question "how do you know whether ..." Google suggests alternatives like "whether an image is copyrighted?" "a function is even or odd?" and "an inequality has no solution?"
Unfortunately, not enough of the online search-obsessed are in the market for a home or a solution to a housing issue to get Google to suggest real estate-related subjects for the most common questions people begin typing.
But after many years of living and breathing the stuff of what real estate users care about, I can probably take a guess at what the real estate-related online search obsessions are, and can even categorize them into syndromes in the same vein as my own personal Google tic:
1. The Online House Hunting Tic. These are the folks who are always online, looking at listings, searching for houses -- whether they are actually looking for homes or not! (Frankly, this is just an online extension of the behavior symptomized by an obsession with TV shows like "House Hunters" and "House Hunters International" -- see a related article at Inman News: "Behind the scenes at 'House Hunters International.' ")
And there are several variants on this. Some people just want to know what's on the market in their neighborhoods and their towns. Others take a more escapist approach, searching for homes in the areas they fantasize about living in, whether or not they actually have any sort of plan on moving. Life would be perfect if ...
2. The Open House Tic. This is a hybrid online and offline version of the fixation exhibited by those who get online every Friday and Saturday to prepare their plan of attack for Sunday open houses. This behavior is completely normal and, even, advisable, in actual house hunters -- people who are actually in the market to buy a home, or even home sellers who are (wisely) seeking to scope out the competition.
But it takes on a compulsive element when people who have just bought a home, or have no intention of buying a home anytime soon keep open-house hunting as a weekly habit.
To be fair, this goes on the list of relatively harmless vices, except to the extent that it signals or churns up that feeling of constant discontent, that sense that the home you have is never quite enough.
3. Interest Rate OCD (obsessive-compulsive disorder). Chances are good that you know someone who suffers from these symptoms: obsessively checking online mortgage and news sites to see whether mortgage interest rates have gone up or down, often either (a) dropping an email to their mortgage broker afterward to see whether they've dropped low enough to warrant a refinance, or (b) freaking entirely out that they locked their interest rate or refinanced too soon to catch the very lowest rates.
Market conditions these last few years have only caused this epidemic to spread, as every time we think rates have gotten about as low as they ever have or ever will, it seems like a new "historic low" benchmark is set the very next week.
4. Amateur Appraiser Syndrome. The advent of home-value estimates on various real estate sites has caused some people to fixate on what the sites say is the value of their home. That's not that strange, considering that our homes are our biggest assets and that they have taken such a hit in value of late.
However, it becomes a little strange when you leverage these sites to voyeuristic purposes, tackling your Christmas card address list or your friends' and neighbors' addresses to figure out what the algorithm says their homes are worth, and why you do or don't agree with that.
5. Incessant Redecorating Syndrome. Typically, people suffering from Incessant Redecorating Syndrome tend to prowl celebrity home listings and luxury home sites, as well as home decor and furnishing sites, well, incessantly, even if they live in a fully furnished rental or just peeled the stickers off their new furniture at home.
And they often do these searches on their laptops, while watching home remodeling shows on television or flipping through home decor magazines.
It's a compulsion.
These behaviors, which are actually smart and a great use of technology if you're readying to make an actual real estate move, can become obsessive and even a distraction from other things you should be doing if you persist at it, allowing it to take up a large amount of your time, even when you have no intention or even the vaguest plan of making a move.
Tara-Nicholle Nelson is author of "The Savvy Woman's Homebuying Handbook" and "Trillion Dollar Women: Use Your Power to Make Buying and Remodeling Decisions." Tara is also the Consumer Ambassador and Educator for real estate listings search site Trulia.com. Ask her a real estate question online or visit her website, www.rethinkrealestate.com.

Pros and cons of pricing home under market

Don't jump to conclusions when you hear that a listing sold for more than the asking price. You need more information. Are prices are heading up in your area, or did the sellers intentionally price low to stimulate multiple offers?
There was good news about the housing market recently. In October, pending sales rose 9.2 percent from the same month a year earlier, according to the National Association of REALTORS®. Pending sales are a leading indicator, and the index is a measure of homebuying interest.
Unlike recorded home sales, a certain number of pending sales don't close. Even so, this is a positive sign in the midst of a volatile market.
In some areas where job growth is strong and there aren't many homes for sale, home prices are starting to rise. But at this point, these areas represent a small part of the overall housing market.
Unless you're selling in a high-demand, low-inventory market, it's risky to list your home under market value. Some sellers use this strategy to increase their chance of multiple offers and a quick sale for over the asking price.
This strategy could backfire if you are priced low and receive only one offer for the asking price or less. It's difficult to negotiate buyers up on price when they're not in competition with another buyer.
On the other hand, if you know there is strong demand for a home like yours, pricing on the low side could generate enough action to get your home sold at or over the list price. But you shouldn't price lower than a price you'd be willing to accept if you receive only one offer.
HOUSE HUNTING TIP: Sellers should have a good understanding of the pricing dynamics currently operating in their neighborhood before they select a list price for their home. Are listings sitting on the market for months or are they selling quickly? Are certain locations or price ranges more active than others? How does your home compare to those that sold recently? Pricing right for the market is critical to selling in today's market.
Like sellers, buyers should become price experts on the areas where they would like to buy. The Internet makes this chore a lot easier. But you'll get a better feel for valuation if you see homes that would satisfy your housing needs in person.
Don't focus on list prices. Sellers often make the mistake of listing for more than their neighbor's second-rate home. However, if the neighbor's home is priced too high, this isn't a good benchmark. Also, consider that the reasons you think your home is better may not be in sync with the way a buyer may view your home.
It's difficult for buyers and sellers to be objective about buying and selling homes. Most sellers have strong attachments to their home and have a hard time divorcing themselves from it emotionally. This can cause them to reject a good offer and later regret the decision.
Buyers can be so objective that they find it impossible to buy a house. The perfect house does not exist. Neither does the perfect deal. Compromises need to be made, but with full understanding of the pros and cons. In other words, you should make rational decisions about the price you pay and what you're willing to live with.
Knowledge of local pricing is essential for buyers in market niches that are hot compared to the rest of the market. Be sure to find out the sale price of homes that you've seen and liked or bid on and lost.
THE CLOSING: This way you'll be in a better position to have a shot at winning in competition the next time.

Top 10 US metro areas with steepest home-price cuts in 2011

Michigan and the Southeast markets dominate the list

Editor's note: This list, based on data compiled by Zillow, represents the top 10 metro areas ranked by steepest year-over-year percentage drop in average listing price during 2011 compared to the previous year. Median home values listed in the charts are based on the Zillow Home Value Index.
Metro areas in Michigan and the Southeast experienced the most substantial cuts in for-sale home prices listed on Zillow.com in 2011 compared to 2010. Flint, Mich., and Detroit topped the list at No. 1 and No. 2, respectively, experiencing 13.21 percent and 12 percent price drops on average home listing prices, respectively.
The rest of the top 10 spanned from No. 3 Bakersfield, Calif., with a 9.85 percent price drop in listing price, to No. 10 Gainesville, Ga., at a 9.6 percent drop.
Following the most recent housing market turmoil geographic trends, all of the top 10 metro areas were clustered in north-central Florida, Georgia, Michigan and California.
The Interstate 75 corridor cuts through or near most of the markets on the list, including: Lakeland, Fla.; Ocala, Fla.; Macon, Ga.; Atlanta; and Gainesville, Ga., in the Southeast, and Detroit; Flint, Mich.; and Lansing, Mich., in Michigan. Bakersfield, Calif., and Madera, Calif., in Calfornia's Central Valley, are the exceptions.
Lansing, Mich., at No. 9, was the metro with the lowest average listing price in the top 10, at $56,600. No. 7 Macon, Ga., was not far behind with $57,000. Bakersfield, Calif., at No. 3, had the highest average listing price at $130,300, followed closely by Gainesville, Ga., at $124,500.

Metro: Flint, Mich.

Median Home Value	N/A
Year-over-year Listing Price Change	-13.21%

Downtown Flint, Mich. Flickr/Michigan Municipal League

Metro: Detroit, Mich.

Median Home Value	N/A
Year-over-year Listing Price Change	-12%

Detroit, Mich., skyline. Flickr/Bernt Rostad

Metro: Bakersfield, Calif.

Median Home Value	$130,300
Year-over-year Listing Price Change	-9.85%

Bakersfield, Calif. Flickr/jjandames

Metro: Lakeland, Fla.

Median Home Value	$94,900
Year-over-year Listing Price Change	-9.85%

Lake Mirror Promenade in Lakeland, Fla. Flickr/jared422_80

Metro: Madera, Calif.

Median Home Value	$108,500
Year-over-year Change	-9.82%

Downtown Downtown Madera, Calif. Flickr/gflinch

Metro: Ocala, Fla.

Median Home Value	$77,300
Year-over-year Listing Price Change	-9.82%

An Ocala, Fla., farm. Flickr/Bruce Bouley

Metro: Macon, Ga.

Median Home Value	$57,000
Year-over-year Listing Price Change	-9.74%

U.S. Courthouse and Federal Building in Macon, Ga. Flickr/Ken Lund

Metro: Atlanta, Ga.

Median Home Value	$114,100
Year-over-year Listing Price Change	-9.7%

View of Buckhead, a district in downtown Atlanta. Flickr/Brokentaco

Metro: Lansing, Mich.

Median Home Value	$56,600
Year-over-year Listing Price Change	-9.64%

Downtown Lansing, Mich. Flickr/Dextera Photography

Metro: Gainesville, Ga.

Median Home Value	$124,500
Year-over-year Listing Price Change	-9.6%

Hall County Courthouse, Gainesville, Ga. Flickr/jimmywayn 

5 faces of real estate dealmaking: from 'Drama Queen' to 'No-gotiator'

Mood of the Market

I was one of those kids who was mortally embarrassed by my parents. (I later realized that their fashion choices were not bizarre -- they were just '70s chic held over a tad bit too long.) My mother seemed always to gravitate to the yellow 'sale' signs on top of retail racks -- which seemed horrifying back then.
And my Dad? Horror of horrors, he tried to negotiate everything -- and I mean every single thing. He would actually bargain for things like TVs and computers at stores like Sears, and I would grow hot with embarrassment, detouring into what we'd now call the "tween" section, hoping no one would know we were related.
Fast forward 10 or 15 years, and you'd find me, at an appliance outlet, getting my washer and dryer for 50 percent off because the front windows had been scratched, and negotiating for them to order and install new windows before delivering the machines to me.
Or maybe you'd find me shopping my favorite consignment stores (where I still negotiate, despite the already discounted pricing) or walking straight into my favorite retail establishments and taking my familiar route straight back to the sale section, and back out when nothing strikes my fancy.
Or haggling for my car, which I bought for 60 percent -- you read that right! -- of the Blue Book price. Or watching my kid's mouth gape open when I got the sales clerk to throw in the two flannel shirts he wanted with the sneakers I'd just bought him. Score more notches on my negotiating belt.
No matter how flush with cash I am, I love a deal (no, I mean, I love a deal!). I'll spend, but I want to feel like I'm getting more than the "average bear" (to quote a famous Yogi) for my dollar.
In my adulthood, my Dad and I have often worked together on strategies for negotiating our largest purchases -- particularly when it comes to real estate. (My Dad is a prolific investor, and I've negotiated for a hundred or so homes myself.)
I've noticed that my Dad and I have distinct negotiating styles. I tend to gravitate toward properties that are already value-priced, get as much information as possible about the seller's situation, and negotiate a reasonable discount plus as many perks and incentives thrown in as I can.
I like places with major upside potential, so I can control how their value increases, no matter what's going on in the market.
My Dad tends to run all sorts of numbers and analytics, plus wield the fact that he pays in cash, as major bargaining leverage. And his constant refrain is "Buy it right." He wants to feel that he is buying a place that already has lots of equity and/or cash flow potential because he bought it for such a low price -- it takes the pressure off when he later wants or needs to sell.
We share in common that we never make our best offer on our first offer (except in a seller's market, when all the rules change) and we virtually never accept the first offer we receive.
We both place a strong priority on neighborhoods, have a tendency to avoid getting emotionally involved or attached at all to homes, and insist on starting the negotiation off being very clear and realistic in our own minds about the contours of our own personal top or bottom lines.
As I contemplated how my father's negotiating skills and my own negotiating styles are similar and dissimilar, I could not escape noticing how other buyers' and sellers' negotiating styles can be grouped into profiles, so to speak.
Some I've run into more than a few times in my real estate lifetime include:
1. "The Faux-gotiator." The Faux-gotiator makes a minimal effort at negotiating, because she knows that's what she's supposed to do. Like my Dad and I, this breed of negotiator tries to abide by the never-take-the-first-offer rule. But the Faux-gotiator caves at the slightest sense of resistance from across the negotiating table. And devotees of this style come in two varietals: lazy (they simply don't want to do the work of negotiating, so they barely bother) and attached (they just love the house too much -- or need to sell too much -- to give more than a modicum of negotiating effort).
2. "The Drama Queen or King." These wannabe royals are, in some ways, the opposite of the Faux-gotiator. They make a big hue and cry about how "hard core" their bargaining skills are, about how the other side's issues or interests are just "not relevant" to them, and about how outraged they are when they receive resistance from across the negotiating table.
Yet all that drama tends to be a front behind which they hide truly poor negotiation skills. After they wax hyperbolic, they tend to cave and strike deals not too far from the original list price or offer. Methinks they doth protest too much; often the drama is driven by a premature attachment to the property or sale, or the fact that they have no basis in market data or facts for their negotiation demands.
3. "The High-Rolling Lowballer." These folks pull up to view a modest starter home in a rapper-style Mercedes Benz, and literally drip logos in their wake as they tour the home. Though they seem to have the highest possible ratio of status symbols per square inch of body area, when it's time to actually buy or sell a home, they insist on overpricing or lowballing the seller beyond all reason.
These folks cause lots of head-shaking by the agents and other parties in their transactions, as it seems that a slight reprioritization of their real estate matters over high-status consumer goods might make them better able to make reality-based offer and pricing decisions.
4. "The No-gotiator." These are the folks who offer to pay the list price or take the first offer, as a matter of course, even when the market or transaction dynamics suggest that they could get better terms. Some No-gotiators find the confrontational, adversarial connotations of negotiationg distasteful or anxiety-creating. Others are so attached to a certain outcome that they fear the deal falling apart too much to try to push back against the list price or buyer's offer.
5. "The Reality Checker." Finally, there's a fifth type of real estate consumer negotiation profile, which I'll call the Reality Checker. These negotiators do the research. They know how long the place has been on the market, relative to average in the area; and they're well aware of how much list prices are usually able to be bargained down in that neck of the woods.
They have asked for information about the other side's priorities and, to the extent they received any, they have taken that information into consideration in formulating their offer or response. They are clear about what they can afford to do, and how much they simply want a particular property or outcome, but they are not overly optimistic about their negotiating prowess or unrealistic about what the market will bear.
And they don't go in with rules of thumb -- always trying to get 20 percent off, or some such. They make a smart offer (or counteroffer), or accept the other side's position when reasonable and affordable. And, not surprisingly, they often succeed in both striking a good deal and actually getting what they want.

Should You Purchase or Rent?

There are many factors to be considered when deciding to move to a new location with the first critical decision being whether to purchase some property or rent. Depending upon your circumstances, it may either be a clear-cut decision or one that requires a more thorough analysis to make that determination.

Factors to Consider

Career - For some individuals, it may not be practical to purchase property if their career will require them to relocate frequently. Although some people have the resources and inclination to accumulate property each time they move, for most of us that is either not an option or would be an undesirable outcome to find ourselves in the role of landlord. For the majority of us, that means we need to sell property each time we move, so careful analysis is required to determine whether it is better to buy or rent property for the duration of the assignment. One item to consider is that it generally takes 3 - 5 years under average real estate market conditions to reach the breakeven point for recouping the closing costs incurred at the time of purchase. Individual situations will vary, but in a stagnant real estate market it will take longer to realize enough in property appreciation to cover the transaction costs related to acquiring and selling property.

Property Resale - Not all properties or real estate markets are equal when it comes time to sell property. Factors to weigh include the typical length of time it takes to sell property in your area or the area you are interested in which you are interested, and if there is something unique about the property (price range, location, size) that you are interested in that would make it either easier or harder to sell. Whether or not you have relocation benefits available to you through an employer if you are unable to sell your property may also be a factor.

Finances - The purchase of property typically involves significant upfront cash outlays: pre-purchase inspections, a down payment and closing costs. Equally important is whether or not sufficient income is available to cover the mortgage/escrow payments while still having enough income to adequately take care of other living expenses, car payments as well as saving for retirement. The lack of sufficient funds may quickly eliminate any thought of purchasing property and dictate that in the interim renting, living with family members or some other living arrangement will be required until enough funds can be saved.

Relationship Status - Personal relationships can play an important part in deciding to purchase property. Engaged or newly married couples often are looking to establish a single common property on which to build their future together. Single or newly divorced adults may not be ready or interested in making a long-term obligation to a specific location and prefer to leave their options open as they pursue relationships, careers, other interests and hobbies.

Personal Preference - While some people feel a strong need to own property, others don't want the responsibility of maintaining property and prefer to simply pick up the phone at the first sign of any possible trouble and have someone else be responsible for remedying the issue at hand.

Benefits of Purchasing a Home

Ownership - For most people, owning their home is a key element of attaining the American Dream. And there is nothing quite like buying your first home and realizing it is all yours (provided of course that you continue to make your mortgage payments on time). Homeowners also tend to view their purchase an investment and have incentive to keep their property in good repair.

Building Equity - Obviously the largest benefit is that you are now building equity in your own property instead of contributing to the equity in someone else's property via rent payments. Historically, home ownership has been a long-standing means of building long-term wealth.

Decorating Without Limitations - As an owner, you have the freedom to personalize your property to your heart's content, subject only to local code and any applicable Homeowners' Association rules, unlike when you rent and experience many restrictions as to what you can and cannot do to the rental property. No need to get approval to paint interior walls, change flooring, install custom closet organizers, or complete minor home improvement projects. Although larger remodel projects may require getting permits, other than meeting code requirements, you are limited only by your budget and creativity when making changes to reflect your personal tastes and style.

Financial Stability - Fixed rate mortgages result in both greater financial stability and predictability. Assuming a fixed-rate mortgage, over time your housing costs should become a smaller percentage of your monthly budget as your income continues to grow while the mortgage remains constant. Additionally, fixed mortgages offer a great deal of predictability when preparing long-term budgets. Although repairs and maintenance will need to be factored in, there will be no surprises with unexpected hikes in rent.

Personal Benefits - Owning property frequently allows you a greater opportunity to meet neighbors and develop friendships with others that hold values similar to your own. And unlike apartment dwellers that tend to be more nomadic and view their unit as just a place to sleep at night, homeowner's tend to move less often and view their homes as investments. It is also not uncommon to find neighbors that were drawn to the area for many of the same reasons that caught your attention - good reputation of schools, easy access to public transportation, close proximity to outdoor activities, the architecture of the homes, or the availability of shopping, dining and entertainment within walking distance - giving you something in common right from the beginning to build upon.

Limited Commitment - Perhaps one of the greatest benefits of renting is the limited commitment that is required of tenants allowing, them more flexibility to relocate as circumstances change. Leases often only require an initial six-month or one-year term, allowing a lot of flexibility for tenants. At worse case, if something unexpected comes up and you need to move before the initial lease is up you are frequently out a deposit for breaking the contract, but you don't need to sell a house before you can move or to free up your cash.

Repairs and Maintenance - In many circumstances, a tenant needs only to contact the property owner or manager to have repairs taken care of. And for those who don't have the time or inclination to keep up a yard, renting a property where the upkeep is taken care of can be a real plus.

Roommates - Many people choose to have roommates to help defray housing costs by splitting the cost of rent as well as utilities. Although this tends to appeal more to young adults, it is not limited exclusively to the younger crowd. As the economy has created new challenges, some homeowners have begun seeking roommates to ease financial burdens by filling empty rooms in their homes.

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