A reader sent this note to Realty Times:

I have a question I hope you can help me with! Our home, which was built in 2002, has been on the market for about 85 days. It is right across the border on the Wisconsin side near Hudson and just 20 minutes from Woodbury, Minnesota.

The house is on a cul-de-sac on a corner lot with a huge yard, a built in sprinkler system and several other upgrades as we thought we would be living there forever.

My husband had a wonderful job offer down here in the Milwaukee area, so we took a chance and moved down. I don't know what we are doing wrong! Our Realtor is wonderful, but can't even get people in for her open houses. I know if we could just get people in the house that someone would fall in love with it.

My husband had a large deck built on that wraps around the side of the house. Our landscaping is divine. Our basement is 95 percent finished. The new owner gets to choose the carpet and fixtures. When we moved out, I repainted everything so the house doesn't even looked lived in! It has hardwood floors, a gas fireplace, hot and cold water faucets in the garage ... Aprilaire ... walk-out access from the basement. I left every window rod including custom made blinds throughout the first floor. In any case, we can't even get people to look. We started at $284,900 ... went to $279,900 and now because of the terrible market in that area, our Realtor is suggesting we drop to $260,000! Do you have any thoughts?

Your help/advice is much appreciated.

Tasha

Realty Times responds:

Tasha, there is so much information in your letter, and without realizing it, you have already answered your own question of "why isn't my house selling?"

It's painful to experience, but in slow markets, even good houses languish without selling, but not always for obvious reasons. A real estate expert like your Realtor knows exactly why your home isn't being shown, but because of a tight number of circumstances, there's not much she can do but suggest that you lower the price.

From the clues, you've provided, let's take a look at everyone's viewpoint and some possible solutions to your problem.

From your point of view, you have an almost new home in a great location and in pristine condition. It has wonderful features and lots of upgrades that any buyer should want.

However, the market is telling you something different, which is hard for you to understand. If no one is coming to see your home, the perception is that the home is overpriced for the neighborhood. Serious buyers are prequalified by their lenders within a specific range. If they shop beyond that range, buyers incur more risk, including not getting approved to buy the home, so once they've been approved, they tend to stick to what their Realtors show them.

Realtors will "pull" the best listings in the buyer's range for them to see. A home that is priced at the top of comparables in the neighborhood won't be perceived by a Realtor as a "good deal" for their clients, so it's likely that it is the Realtors who aren't showing your home.

There could be a couple of reasons why the market feels your home is overpriced. One is that other homes in the neighborhood are priced less, so buyers aren't looking in your price range in that particular neighborhood because they aren't expecting or looking for the extra features you've provided at a higher price.

The other possibility is that you are in an area with a lot of new product competition from builders. Buyers may believe they can get a brand-new, never lived-in home under builder warranty for what they would pay you for yours. Of course, they may not realize the substantial costs of sodding lawns, installing sprinklers and security systems, among other upgrades as you have already learned.

Your Realtor may be suggesting a drop in price because the market has spoken and the silence is deafening, but there may be another way.

Real estate equity, despite recent evidence to the contrary, builds up over time. It might pay you to hold on to this home and use it as a rental. Contact your Realtor and find out if her company has a relocation division and a property management division, and offer your property for lease.

A relocation department will want to put prospects into nice homes for either sale or rental, and many transferees prefer to buy new homes. While they are waiting for their home to be built, they could be paying you top dollar to rent yours. These are qualified, fine prospects who will most likely take great care of your home. While it wasn't your intention to become a landlord, relocation leasing could be a way to cover your payments and build equity to the point that you can sell the home later as the market improves.

If you think you'd like to try leasing the home yourself, contact the builder representative who helped you with your home. If there are a lot of new homes being built around you, it stands to reason that some of the buyers who are waiting for homes to be built would be willing to rent in the same area.

A good builder rep may actually help you lease your home because it is in their interest to do so. They want to sell product, and moving a buyer into the neighborhood is a sure way to nail more closings.

Either way, it's time to listen to your Realtor and assess what you want to do as unemotionally and as wisely as possible. Have her run the rental numbers for you. If you can break even renting your home, that's pretty good, or if you can sell without taking a loss, that's good, too.

Of course, only you know what you can manage and what you can afford to do, but you might find that building equity in two homes can be a solid road to building wealth.

Good luck to you, and let us know what you decided to do and how you made out.

Published: June 29, 2005

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