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Selling your house when you have to

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MADISON, Wis. (5/9/11)--If Charles Dickens were writing about home sales today, his opening line might be: “It was the worse-comes-to-worst of times.…” Although sales of existing homes rose in March, they’re still more than 6% lower than one year ago (National Association of Realtors April 20). Average house prices nationwide peaked in April 2006 and are now 31% lower (S&P/Case-Shiller Home Price Indices February 2011). So chances are you’re not going to get anywhere near what you thought you’d get out of your house five years ago--if you can sell it. Can’t wait out the lousy housing market? When you have to sell, you’d better be bold, according to editors from the Credit Union National Association’s Center for Personal Finance. Here’s how:
* Be prepared to lower your price. Properly pricing a house for sale is part of the expertise real estate agents charge for and you should expect. Using that advice, which will be based on recent sales of comparable homes in the area, consider asking a bit less than competing sellers. Give that price a fair chance, but don’t cling to it if it doesn’t attract buyers. After a month or two of no action, drop your starting price by as much as 5% to 10% to persuade shoppers who passed the first time around to take another look. * Be prepared to sweeten the deal. If you’ve cut your price as much as you can, don’t feel that you’re handcuffed. Look for possible incentives, such as an earlier move-out date, or appliances, furnishings, or the backyard play equipment that you’d be willing to leave behind. Also consider ways you can help a cash-strapped buyer with upfront expenses, such as closing costs or condo fees, in exchange for accepting your stated price. * Clean it and fix it. Each faulty light switch or constantly running toilet makes shoppers wonder what hidden flaws your house might have. Each scuffed wall and stained shower curtain makes it harder for shoppers to imagine feeling comfortable in your house. Time and money spent on improving your house’s first and second impressions will put your asking price in a more reasonable light. * Think about hiring a “stager.” This is a pro skilled in determining how to make a house presentable. Ask your real estate agent for recommendations, then check out prospects’ before-and-after evidence and their references. Expect to pay a few hundred dollars for an analysis, and up to $100 an hour for repairs and refurbishing, plus expenses, if you decide not to do the work yourself. * Showcase your house online. Sellers today have many options for spreading the word about--and pictures of--houses for sale. Explore all possible Internet “shoppers’ guides,” not only your agent’s standard Web posting, but “enhanced listings” that give you top billing, as well as alternate sites such as Facebook and Craigslist. Housing is a buyer’s market, and under these conditions, the sellers who connect are the ones who are most creative and flexible.
For more ideas, see “You Can Sell Your House--Even in a Down Market” in the Home & Family Finance Resource Center.