The following is an interesting situation that comes up quite often prior to a seller signing a listing contract with a local REALTOR®. Proceed cautiously around the REALTOR® who tells you "What You'd Like to Hear"...
You'd like to sell your "home" and you've been keeping in touch with the local neighbourhood and some of the area sales. You feel you know roughly what your home is worth, but being a savvy person you call in 3 local real estate salespeople for their professional opinions.
Each one presents you with a printed "Current Market Analysis" and while two CMA's are very close in their suggested offering price - which may in fact be a little lower than you expected, the third is quite a bit higher. Of course, you feel that your lovely home is worth more and you are delighted that this evaluation is more in line, or even better than your opinion.
Like so many people, you decide that you will list with salesperson #3. S/he is the one who feels your home is worth more, and as they mentioned to you, you can easily drop the price later if it's still sitting, right?
"Buying A Listing" is a trap you may have fallen into. Your REALTOR® just bought your business by suggesting that your home is worth more than what the other two salespeople recommended, even though you looked at all the comparables for yourself, and you now know that your expectations are a little ambitious. Your REALTOR® knows that in all probability the home will not sell for the suggested price. The intention all along was to get your listing, and have you under contract for a 90 - 180 day period. Perhaps they can talk you into lowering your price later on, and if that proves to be unsuccessful, they still have something to advertise. Perhaps they can pick up a buyer from a sign or website call, or an ad for your home, or maybe at an open house. With a new buyer in hand they might sell them a different home and still earn a commission.
All the while you are now sitting with an overpriced listing, which not only helps your competition to sell quicker - because they are better deals, but you are left wondering why no one is viewing your home.
... We're sure you'd like to sell as quickly as possible, for the highest dollar for the market, and with the least amount of hassle. Overpricing will rarely get you these objectives. Setting a proper price for your home is critical to your well-being. In fact, a properly priced home may even get you more money then the recommended value. Competitive offers from multiple buyers is always a possibility. Now that they're battling against one another for your home, they will inevitably increase their offer price to win it, and that is always a good sign.