While there have been volumes written about pricing a seller's home and while none of the pricing tips presented in these blog posts are new or earth shattering, it is important to restate the obvious. Although real estate agents know this information intuitively, sellers don't often realize the facts and need to be informed so they don't make false assumptions and do make an informed and factual decisions.
Tip #5: If you refinanced your home in the past few years, the appraisal done by the lender may have a stated value that the current market does NOT support.
You should always price your home based on 1) your current competition and 2) recent sold comparable homes. By recent, this could literally mean the past 2-4 weeks in markets that are in upheaval. If markets are trending significantly downward at a rapid rate, you need to stay ahead of the downward spiral if you hope to achieve success. If a market has declined about 10% in the past year as an example, then you should reflect this in your pricing as well.
The flip-side is also true in markets that favor sellers and homes are flying off the market, which is not the case in today's (12/28/2008) market. In a strong sellers' market, you can get very aggressive in pricing, or price it very competitvely and start a bidding war.
That said, we recently had multiple offers on two homes we had listed for sale in November and December 2008, in the strongest buyer's market on record in Greater Cleveland, Ohio. One home we exensively renovated and, thereby, spurred demand for it vs. it's competition, and the other home was very competitvely priced, was in good condition, and had special features.