Pricing a home right can be tricky, especially in volatile markets with prices that often fluctuate. It’s especially hard to tell if the other current list prices are accurate to the actual sale prices, which usually aren’t public until the sale closes three or four months later.
Analysis of similar homes and market changes is both critical and sometimes difficult. It’s important to keep in mind the raw numbers such as square footage, monthly rental income, condition and location, as well as any special features. These are the most concrete factors on which to base your price.
The history of the home is also valuable but uncertain, as you don’t always know how that particular market segment has shifted since the last sale. One of the best ways to get recent and accurate info regarding similar sales is to contact fellow agents who were involved. A three month old sale might be irrelevant but a two-week old sale of a similar property is a great reference point.
One of the reasons you should ignore list prices, particularly the high ones, is because you can do more harm than good by overpricing your home. In this case the home can sit on the market for too long. If you drop the price, people will either assume you’ll drop it again, or that there’s just something wrong with the house.
Above all, use your intuition. People buy based on emotion, not logic, so this is one of the times where "feeling it out" is incredibly effective, so long as the guestimator is a competent one. As an agent you should have a sense of what the property is worth. Find a solid middle ground between what will sell the quickest and what the seller wishes it would sell for. This type of compromise will not only be effective, but will strengthen your relationship with the seller.