Older homes face serious competition from new homes, which 20 percent of consumers prefer because of modern conveniences and amenities, not to mention that first-one-to-drive-it-off-the-lot feeling. Even if they don't buy new construction, they want the next best thing -- in 2005, 60 percent of homes purchased were 10 years old or less.

But older homes have a major advantage over new homes in many cases -- they are in established neighborhoods.

Explains Bend, Oregon, real estate broker, Bob Cooper, "Many cities have older geo-centers which are very attractive to the upwardly job mobile younger people … especially young families. Sure the homes are “older” but these homes were quality built and are in the heart of the city -- where the commute is significantly shorter, and there are neighborhood groceries, quality schools, and many boutique shopping opportunities. These city-center older areas create a sense of “community” for these younger (and older) home buyers."

What makes the difference between older home neighborhoods that are deteriorating and those that are appreciating?

Buyers want to live there. They may like one neighborhood over another because of location, the size of the homes and lots, price, age and style of homes, the schools, and the overall quality of the neighborhood in terms of what buyers value -- beauty, safety, and that sense of community where others watch out for you and you watch out for them.

As a real estate agent, your job is to help sellers sell their homes, as well as to help buyers find the home they want.

You can't do much about some older homes and neighborhoods, because desirability has to be a community as well as an individual effort, but you can be more effective than you think if you do the following:

1. Show your appreciation for the older home

   Sellers: Show sellers that you not only like older homes, you specialize in them, but that it's also your job to report to them what the market is saying. Explain how you will market the home by playing up its advantages, and how you'll help the seller downplay disadvantages through staging, minor updates, and repairs.

   Buyers: As an agent, you see a lot of houses, and it's easy to become jaded when one home begins to look a lot like another, or if you have to struggle to find something positive to say about a listing. Buyers pick up on your lack of enthusiasm by reading your body language and listening to what you say and don't say. In this case, it's all about competition and price.

   Make sure your buyers understand why homes were designed the way they were in certain eras. Haul out your history lessons and make learning about houses fun. That tucked-away kitchen was a haven for busy stay-at-home moms in the 50s. Open one wall, put in an island, and that same kitchen is modernized for the busy working family.

   Anything the buyer doesn't like can be changed, one step at a time, and often without a large expense. Remember, the age and condition of the home are part of the pricing. Instruct the buyer to keep their eye on the bigger picture -- the neighborhood, schools, and proximity to their jobs, family and friends.

2. Show buyers and sellers how to make improvements

   Sellers: Show your sellers how minor staging can make a room look bigger, how cleaning a window can make a room look brighter. If items need to be repaired or updated, make sure you have a list of good contractors who understand what "make ready" means -- quick, inexpensive updates that whip a home into shape for listing.

   Buyers: Show buyers that minor improvements don't have to be costly and can make a big difference. If you're showing an older home that is too dark, or outdated with flocked wallpaper, make sure you bring along a bottle of windex and a rag, and a sample wallpaper that can show the buyer instantly that change is easy.

3. Show buyers and sellers your best ideas for their homes.

   Sellers: As an agent you have access to a lot of homes, but you can also do research to get ideas. Take photos of homes for sale and put them in a scrapbook. Show before and after pictures of improvements you find in home magazines or online. This shows that you are constantly thinking about the best way to market a home, as you will sooner or later come across an improvement, paint color or repair that will help your seller get more for their money. Don't be afraid to use professional sources such as interior designers to get ideas.

   Buyers: Many interior designers are looking for new clients and would love to help you sit an open house and talk to buyers. This adds real panache to your showings as it shows buyers that this home and this neighborhood are worth investing in.

   For buyers who are negative on such styles as the ubiquitous ranch-style home, use a shoebox as a prop. Most ranch-style homes were built for speed, so you'll find most load-bearing walls are on the outside, making the ranch-style home cheap and easy to remodel. Keep index cards folded into the shoebox to simulate walls. When a buyer doesn't like the size of a room, knock the "wall" over.

Selling is competitive, but buyers won't buy unless they can see the possibilities, and many are too afraid of remodeling costs in addition to the sales price, or they simply can't visualize what a room, floorplan or home could be like with a little elbow grease and imagination. Keep lots of pictures available and when you see a home with a similar design you can show your buyer what can be done. Remind your buyers that they are going to personalize any home they buy anyway. This way, they'll be making a transformation, and making a bargain of an older home into a treasure that will be appreciated by others.

And what happens when houses are appreciated by others? Prices go up.