More often than not properties get listed way over a realistic price because real estate agents "buy the listing". It is tough for realtors to compete with several other real estate agents and companies to list a property. There is a tendency among sellers to list their property with the agent who tells them that it's worth the most money. Because of this, most agents will inflate the value they give to the sellers strictly to get the listing. They simply over promise and underdeliver. They figure that even though the house won't sell right away, later they will be able to pressure the seller to do a price reduction.
This is a total waste of months of the seller's valuable time.
TIP: Be aware that it can benefit a real estate company and agent to have your property listed even if they KNOW it won't sell. Here is why:
Many franchises teach brokers that "market visibility" and "market share" is extremely important. They teach the brokers that the more signs that are visible to the consumer with their name on them the more business they are going to get. There is also an internal competition for "bragging rights" between brokers in an area to have the most listings.
The bottom line is many properties that are listed in most areas are priced way too high! Some may well be on the market for many years. These listings are so common that there is a slang term in the real estate industry for them. They are known as "career listings". In other words, the agent will have them listed the entire length of their real estate career.
TIP: When you are talking to a real estate agent, be very aware of what you have just learned about the tendency to take a listing at any price to get a sign on the lawn. The agent is telling you what you want to hear about the value of your home just to get the listing, especially if other agents quoted you a lower prices.
