Key Takeaways
- Listing price is the seller's starting point for negotiations.
- It's not always the market value; research comparable sales.
- A good listing price attracts buyers and can lead to multiple offers.
- Real estate agents use CMAs to set realistic listing prices.
Article Summary
A home's listing price, often called its "asking price," is the starting point for negotiations between buyers and sellers. The seller sets this price, often in consultation with their real estate agent.
Listing price refers to the amount of money a seller sets as the asking price for their property when it is put up for sale.
A Longer Definition: Listing Price
A home's listing price, often called its "asking price," is the starting point for negotiations between buyers and sellers. The seller sets this price, often in consultation with their real estate agent.
The listing price reflects what the seller hopes to receive for their property.
A home's listing price is based on an assessment of the current real estate market conditions, the property's location, its size and condition, comparable sales in the area, and unique features and improvements that might add value to the property, such as whole-home ethernet or energy-efficiency improvements.
If the listing price is set too high, the home may stay on the market for a long time and might require one or more price reductions. Conversely, if the price is set too low, the property may sell quickly, but the seller may miss out on potential earnings.
Real estate agents often use Comparative Market Analysis (CMA) to determine a realistic listing price. CMAs compare the home for sale with similar properties that have recently sold, are currently on the market, or failed to sell, adjusting for differences like location, size, and condition.
The right listing price can attract potential buyers, generate interest, and lead to multiple offers, sometimes above the asking price.
U.S. Median Home Listing Price: Chart
FRED Data: MEDLISPRIUS
Realtor.com, Housing Inventory: Median Listing Price in the United States [MEDLISPRIUS], retrieved from FRED, Federal Reserve Bank of St. Louis; https://fred.stlouisfed.org/series/MEDLISPRIUS, December 4, 2025.
Listing Price: A Real World Example
Imagine a first-time home buyer searching for a home. They find a home for sale within their pre-approved mortgage limit. The listing price, strategically set by the seller, reflects the market value based on similar neighborhood sales. It also plays a psychological role, setting the tone for negotiations and creating a perception of value and fairness in the buyer's mind.
For the buyer, this listing price is an invitation to engage. Their buyer's agent advises them to offer slightly less than the asking price and look for a good deal while leaving room for negotiation.
The buyer makes an offer below the listing price, and the seller counters fairly. After a few rounds of negotiation, the buyer and seller agree on a final sale price slightly below the original asking price.
Common Questions About Listing Price
How is a listing price different from a sale price?
The listing price is the initial amount a seller asks for a property, and the sale price is the amount the property is sold for after negotiations.
Can a buyer offer more than the listing price for a home?
Yes, in a competitive market, buyers sometimes offer more than the listing price to outbid other potential buyers.
What happens if a property doesn't sell at the listing price?
If a property doesn't sell at the listing price, the seller might lower the price or adjust their selling strategy, such as improving the property's condition or marketing.
Is the listing price of a home negotiable?
Yes, the listing price is often negotiable. Buyers can submit offers below the listing price, leading to negotiations between the buyer and seller.
Does the listing price affect a home's appraisal?
The listing price can influence a buyer's perception and offer but does not directly affect a home appraisal, which is an independent assessment of the property's value.
