for a better offer, and sells it for over 3 percent more than your house-or $10,000 on the sale of a $300,000 house. Thats $10,000 going into her pocket that does not go into yours, a nifty profit pro- duced by the abuse of information and a keen understanding of in- centives. The problem is that the agent only stands to personally gain an additional $150 by selling your house for $10,000 more, which isnt much reward for a lot of extra work. So her job is to convince you that a $300,000 offer is in fact a very good offer, even a generous one, and that only a fool would refuse it. This can be tricky. The agent does not want to come right out and call you a fool. So she merely implies it-perhaps by telling you about the much bigger, nicer, newer house down the block that has sat un- sold for six months. Here is the agents main weapon: the conversion of information into fear. Consider this true story, related by John Donohue, a law professor who in 2001 was teaching at Stanford Uni- versity: "I was just about to buy a house on the Stanford campus," he recalls, "and the sellers agent kept telling me what a good deal I was getting because the market was about to zoom. As soon as I signed the purchase contract, he asked me if I would need an agent to sell my previous Stanford house. I told him that I would probably try to sell without an agent, and he replied, John, that might work under nor- mal conditions, but with the market tanking now, you really need the help of a broker. " Within five minutes, a zooming market had tanked. Such are the marvels that can be conjured by an agent in search of the next deal. Consider now another true story of a real-estate agents informa- T he K u Klux Klan and R e al-Es t at e A gent s     tion abuse. The tale involves K., a close friend of one of this books au- thors. K. wanted to buy a house that was listed at $469,000. He was prepared to offer $450,000 but he first called the sellers agent and asked her to name the lowest price that she thought the homeowner