Is your neighbor hurting your home's value?

(Money Magazine)

A recent survey by Harris Interactive and State Farm Insurance found that 60% of Americans have a pet peeve with someone who lives nearby.

A bad neighbor "can make your life a total nightmare," says Bob Borzotta, managing editor of NeighborsFromHell.com, whose message boards contain more than 42,700 posts on unfriendly neighbor behavior.

At the extreme, certain next-door nuisances -- such as annoying pets, unkempt yards, foul odors, and dangerous trees -- could reduce your home value by 5% or more, according to the Appraisal Institute.

Case in point: Omaha real estate appraiser John Bredemeyer says that a few years ago he saw a house in his area sell for 8% less than comparable homes nearby, owing largely to the large, snarling dogs next door. "Raising kids there?" he says. "I don't think so."

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So what's your recourse? "You can move to the woods," Borzotta says. "Or you can expect issues and learn how to deal with them properly."

Try this conversation before you start eyeing log cabins.

The Ground Rules

Temper your temper. "The worst thing to do is march over when you're angry and demand action," says Mary Greenwood, author of How to Negotiate Like a Pro. Take 24 hours.

Give notice. Don't try to work this out over the hedgerow. Schedule a time to chat. Maybe even invite the offender to your house, a friendly gesture that also allows him to see his ugly satellite dish from your perspective.

Do your homework. Before the conversation, research what state laws or local ordinances apply, in case your neighbor needs extra persuading.

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Keep a log. A record of your dispute can help refresh your memory should you eventually go to the authorities or to court, says Emily Doskow, co-author of Nolo's Neighbor Law.

Your Best Approach

1. Opening gambit: "Hey, Doris, I haven't seen you in a while. Everything okay with you?"

Why it works: Understanding your neighbor's circumstances may allow you to see the problem differently, says Susan Hackley, managing director of the Program on Negotiation at Harvard Law School.

Maybe the dog that's been incessantly barking is outside more often because the owner has a visitor who's allergic. Or the yard is a mess because your neighbor was ill. Best case, you'll find out that the situation is temporary. But if not...

2. Make it about you: "My child naps in the afternoon and won't sleep unless it's quiet. Thing is, Champ is often outside barking then."

Why it works: Focus on how the problem affects you, and your comments will probably be better received than "Your beagle barks too much" -- which sounds like a criticism. Using "I" statements rather than "you" statements helps you avoid coming across as confrontational, says Matt Phillips, executive director of the National Association for Community Mediation (NAFCM).

3. Parrot back: "I totally understand that you can't bring Champ to work and that doggie day care is too costly."

Why it works: "The neighbor needs to feel like you get it," says Michael Donaldson, author of Negotiating for Dummies. Show you understand her perspective by rephrasing what she says in your words.

Hearing what's important to her can also help you come up with solutions that work for both of you. Should you learn that she's concerned about the cost of removing a sick tree that hangs over your house, for example, you could suggest splitting the bill (if you're feeling so generous).

4. Know what you'll take: "It'd be great if Champ stopped barking altogether, but what I really need is for him to be quiet from 2 to 4 p.m."

Why it works: You're stating what you see as a reasonable resolution. Donaldson suggests figuring out in advance what your ideal outcome is, what you'll tolerate, and when you'll walk away. Walking away means being ready with an "or else" plan -- like calling the cops if your neighbor refuses to turn down the blaring music after midnight.

5. Lay on the law: "You probably didn't know that there's a local ordinance on noise. I brought a copy."

Why it works: As the saying goes, "Speak softly and carry a big stick." Handing your neighbor a copy of the law shows that you're serious and, if needed, have some powerful next steps, says Roger Dawson, author of Secrets of Power Negotiating. "But approach it gently," he advises. You don't want to come across as a jerk who's looking for any excuse to escalate.

6. Seek outside help: "Hmmm. We don't seem to be getting anywhere. Can we give mediation a try?"

Why it works: At mediation, you and your neighbor sit down with a third party to find a solution. "It puts positive attention toward the goal of working the issue out for both sides," says Nolo's Doskow.

Roughly 75% of those who use mediation walk away with an agreement, according to the NAFCM, which supports about 400 centers. Prices typically range from zero to $200 a person (often based on what you can afford) for a three- to four-hour session. Hiring a lawyer costs a lot more. An initial consult usually runs $500 to $1,000; going to court can add $2,500 at minimum.

Plus, you'd be stuck living next door to someone you're litigating against. Awkward. Better to try to settle the issue with a neighborly handshake.