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Home sales posted their sharpest drop in 18 years this week. As a homeowner, you can't ignore the headlines. Here are the smartest moves you can make if you're selling your home or even staying put.

Thursday April 26, 1:08 pm ET
By Gerri Willis, CNN

: Sell smart

If you're planning on selling this spring, you'll want to assess the market like the pros do. Find out whether median prices are falling in your area by consulting a local agent, or the Web site for the local realtors' association.

Next, determine whether homes in your area are taking longer to sell. Agents track "days on market," that is the number of days it takes a home to sell. If that number is double what it was a year ago, you'll know your market is in trouble.

Consider waiting out the cycle (and it is a cycle). If you can afford to wait a year or two, you'll have more luck getting the best price for your home.

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2: Spend wisely

Now is not the time to spend a fortune on a new kitchen with all the bells and whistles or to add a first floor suite. The rule of thumb is that you should spend no more than 20 percent on renovations.

If you are planning upgrades this spring, make sure you stay well within that guideline or even less. The point is that you don't want to sink a lot of money into an asset that is losing value.

3: It's still your problem

Even if you've been making your mortgage payments on time, foreclosures in your area can hurt your property value. In fact, for every home that goes into foreclosure in your neighborhood, your property value drops by about 1 percent.

So, if you have three foreclosed properties in your neighborhood, your home will fall about 3 percent. And it will stay depressed for at least two years, according to the Center for Responsible Lending.

To find out where the foreclosures are in your area, go to realtytrak.com or foreclosurenet.net and type in your zip code.

4: Recheck your mortgage

More than one in three homeowners don't know what kind of mortgage they have. In this kind of market, you can't afford not to know your loan terms.

So, whether you're selling or staying put, dig out those closing documents. Find out when exactly your rate will reset. You will find this on the Adjustable Rate Rider which is one of the first few pages in your documents.

You'll want to find out how often you're rate will increase and what caps there are to how much that increase can be. If you can't find these documents, call your real estate agent and ask.