Consider the situation - a new agent goes to school and enters the field of real estate ready and eager to do everything correctly.
One of the things this agent learned in school is how to do a market analysis - to determine just how much a home should bring in a given market by making comparisons to homes that have recently sold, homes currently for sale, and homes that expired off the market without selling.
Eventually there comes an opportunity to use this skill - a potential listing client calls and asks the agent to come and tell him what his home is worth.
The agent views the home and takes careful notes and photographs, then goes back to the office and begins to work. She chooses the most similar homes from each of the three categories in MLS, then makes careful comparisons and adjustments. It takes a bit of time, but the agent is eager to do it right. She doesn't want to make a big mess of it the very first time out!
Finally the agent arrives at a suggested selling price that appears to be "right on" and goes back to see the potential seller.
But instead of signing the listing, this potential listing client says something like "Thanks, we'll think it over and get back to you."
The agent waits a few days and then calls. The machine answers and she leaves a message, but doesn't get a call back.
Then she goes to work one morning and pulls up the hot sheet on the MLS website. And there is "her" new listing. But, it's listed with someone else for about $30,000 more than the price she recommended.
After this scenario is replayed a few more times, the agent begins to wonder about the value of an honest opinion.
Some other agents are playing the "pricing game" and "buying the listings." Meanwhile, she's sitting there with no listings in exchange for doing careful and true assessments.
It could take years for our new agent to build a reputation that will remove her from this kind of listing competition - but it only takes a minute to quote an inflated price and get that listing signed.
Of course there's the problem of "no offers," but she can deal with that later - after the listing belongs to her. Or maybe she'll be able to talk sense to the seller in a few weeks, when there have been no offers.
Unwitting sellers hurt their own chances of selling their homes - and can cause a potentially good agent to go bad.
It's a shame. So sellers, when you get two or more diverse opinions on the value of your house, take the time to really read those market analysis forms. Then take the time to ask each agent how they arrived at the suggested price.One of them may be trying to "buy" your listing by telling you what you want to hear instead of what you need to know.
Homes that start out too high stay on the market a long time. And, because after a while agents stop showing them, the price might have to be reduced below market value just to get a looker.
It always pays to list at the correct price from the first day.