Kevin McCormally: I am Kevin McCormally of Kiplinger's, I am here with Pat Esswein the Housing Editor of Kiplinger's Personal Finance Magazine, to talk about how to price a home in today's market. Pat one more thing we hear from a real estate agents is that home sellers refuse to face reality, the fact that the market has slowed down, the market has turned around in some areas. What's the risk if a home seller sets the price too high?

Pat Esswein: Well, sellers who persist in thinking that they'll get today what they could have gotten two or three years ago, run the risk that no one will come to see their house. We hear stories of open houses to which no one comes and they also run the risk that their home will become stale on the market, the longer it's on the market, the less likely agents will bring their buyers to see it.

Kevin McCormally: Okay, so how do people set the price right?

Pat Esswein: Well you have to work with your agent on this. What your agent needs to prepare for you is something called a Competitive Market Analysis or a CMA for short. This involves looking at comparable properties that have either -- that are currently listed for sale, that are scheduled to close fairly shortly or that have closed within the past few months. Within that framework then you identify the price that's right for your house.

Kevin McCormally: How do you protect yourself against the agency which is asking that you set too lower price, I mean the agent wants to sell the house as best as possible, move on to the next property, how to protect yourself about against setting too low of a price?

Pat Esswein: Well I think that looking at the comparables that we have just discussed is a safeguard against that but I think it's important to remember, yes the agents wants to sell your home quickly that don't you too?

Kevin McCormally: Good point. Now I have heard something about a range of pricing that's coming about in some parts of the country, what's that all about?

Pat Esswein: Oh! that's called value range pricing and it's a strategy or some say again that was created out in California. The idea is that if your house is probably worth 250 you value range price it for 225 to 275.

Kevin McCormally: But Pat why would anybody offer more than 225?

Pat Esswein: Well that's exactly what some agents on the East Coast say, no buyer is going to offer you more than the lowest end of the range. So what is the point?

Kevin McCormally: Okay, Pat one final question. Are there any kind of concessions that sellers are likely to run into as they go through negotiating process with potential buyers?

Pat Esswein: Sure, one idea that's come back into style is the notion of sellers paying points for the buyer, what that means is that the seller prepays interest on the buyer's mortgage loan.

Kevin McCormally: And where does it get for both sides?

Pat Esswein: Well what the buyer is really looking for is the slowest possible monthly payment. So when the seller prepays the points they get that lower monthly payment. But it works for the seller too because they don't have to cut the price on their house as much to get the same bang for the buck.

Kevin McCormally: Okay, thank you Pat.