You wrote:  "It is rare that buyers will pay the extra over an appraised value of a home."  Sorry about the devils advocate.... but I did on my first home.... it was a different kind of market though.... I think we split the difference with the sellers. If we let the house get away there was nothing else to buy.  There's something else to buy here now, in most every part of town. 

Of course you have crazy high prices where you are.     

Hi Maureen - Yes, on occasion a buyer will pay more than the appraised value for a home.  But, generally that is in a hot, appreciating market with extremely low inventories of homes to sell.  That is not the market we have in my area.  Pricing a home $150,000 over value (about 35% more than current market value) won't work here - not when there's so much else - bigger, newer, in better condition and on larger lots - to choose from at that list price.

Now if the difference between the price and the appraised value was minimal, then I could certainly see both parties coming to some agreement, such as splitting the difference, as you mentioned.  Or if the buyer really wanted that home, then they may pay the difference.  But, that is not the norm.

Don -

Sorry to read about the lost listing. What probably will happen is this will become the house used locally by agents to show buyers what a great buy the well priced home they are considering really is.

Fred - You're exactly right that this home will be used to sell other homes.  That's a real shame for the sellers.  I don't feel as though I lost a listing, though.  I won't take overpriced listings, particularly one that's 35% over it's market value!

You bring out some good points, Don. Unfortunately, there is always a hungry agent out there willing to take the listing at any price.  I think Lenn called those listings - predator listings.

Hi Joan - "Predator Listings."  I like that.  I never would or could "buy" a listing.  I spend too much time, engergy and money marketing my listings to take one on that won't sell.  Plus, I'd feel so guilty...

Don, what do they say about being the third wife, or is it the third listing agent? Keep an eye on that house and maybe they'll come to realize you were the only one telling them the truth!

Hmmmm. it sure would take a lot of staging to bring the value up 35%, but...with that said...I'm glad you mentioned that staging is key to the sale.  Afterall, there are only two things you can control: 1) price, and 2) show condition of the home!

Susan Smith
Rooms That Work
Your home, only better.

Catherine - We've been joking that we'll have this listing in 6 months...But if the sellers still aren't realistic about their pricing, then we'll take another pass.

Susan - You're right - price and condition are the most important issues to sell a home. 

actually, it is not necessary to over priced a home even though you had value that particular home heartily. if you value that home so why should you sell it? its a very stupid dewcision or you are just saying that you value that home in order to priced it higher thatn expected, because you are thinking that the buyer will appreciate it........................well i will tell stop doing it so because it is so shame. but if the buuyer will just buy your over priced home, well your lucky.! but, please, be fair enough to priced homes. i know that it is not necessary to over priced a home because im a marketing student and my instructor is really great, very good in teaching, i really praised the way she do it so. i love my teacher because she is a good role model to us..BE REASONABLE ENOUGH!!!

Hi Reina - Some sellers believe their home is worth more than the market dictates it is worth.  Either because they need the money, or because they love their house so much that they see it as being better than any other comparable home.  Homeowners are usually not real estate experts, nor are they experts in valuing homes.  That is the job of Realtors and appraisers.

However, as Realtors and appraisers, we need to consider the rule of Substitution - a buyer will not pay more for your home than they can buy a similar home for.  They will substitute that similar home for yours and buy the one that is priced correctly.  And, of course, we look to recently sold similar homes to determine what the buyers are actually paying for similar homes.

aren't you going to reply thrice? 

Maureen - Reina's comment appeared 3 times for some reason.  I deleted two of the duplicates.

I know I saw it.  That's why I asked the smart A$$ question.  It looked like spam when I saw the notice that there were comments on the blog, but then  there were no links.  ActiveRain must have hiccuped twice fast because they did look identical. 

I tried leaving a comment on Maureen Francis outside blog last Friday and it would not take.  I feared I was going to end up with three comments in a row.  They would not have been identical though because I could not remember what I wrote. 

Wouldn't it be great if you could get the seller who wants to overprice a home to just say "it is not necessary to over priced a home " and show your credentials and they would understand and comply? 

Maureen - Yes, I wish all sellers would realize we price their homes to SELL not to insult them.  Pricing the home to sell is part of our job.