Throughout my 18 years in the real estate auction business, I preached the same sermon thousands of times - "it's only worth what the market will bear" - and "the market always speaks for itself." As much as we want to believe that we can put a sticker price on a home and it will sell for that price (or more) it simply isn't true. Even in a red hot market, you CAN overprice your home in anticipation of great things, and when you do things don't turn out so well for you.
Even in a frenzied market using escalation clauses ..even when the market appears to be out of control with people paying ridiculous prices...if you start out with a price too high you WILL get left in the dust. Instead of seeing people scrambling to look at your home, you'll see just a handful of tire kickers. Instead of seeing contracts submitted left and right with escalation clauses to improve the odds, you'll either get no offers at all OR you'll get an offer that YOU think is too low. But the market will always speak for itself and there's nothing you can do to change it.
Before you allow a "low offer" hurt your feelings, it's better to give careful consideration to it and make a reasonable counteroffer than it is to send the buyer packing. As harsh as it sounds, no matter what you think its worth, no matter how much you want for it, no matter how much money you've put into it, no matter how crazy the market is, it's only worth what someone is willing to pay you for it...period. You can get there fastest if you price it right in a competitive market from the very beginning.
Back in the day when I was doing hundreds of auctions a year, what made the bidders compete up to ridiculous prices was having a reasonable starting place - and that's the same thing that happens in a frenzied market using escalation clauses. The market is given a chance to speak for itself. The market is reflecting what IT IS willing to bear. When it's priced right it ends well, when it isn't it doesn't.
A good real estate professional will have their hand on the pulse of the market and they will guide you accordingly. Beware of hiring a real estate agent that is too busy saying what you need to hear to speak the truth. For instance, your pro should know when the market is in a frenzy that there's no such thing as pricing it too low, AND they should know that if it starts out overpriced, the only place you have to go is D O W N.
I'm no longer working in accelerated sales aka auctions because the market has learned how to maximize the interest and create a bidding war all on its own. These days I'm focused on helping all those homeowners everywhere learn how to accelerate the equity on their property so that they never find themselves owing more than it's worth, and so they can build a portfolio/wealth if that's their desire. Real estate is cyclical - it goes up and it goes down and it always will. The funny thing about accelerating equity, it doesn't much matter where the market is if you owe little/nothing on your property...and that's the truth.
If it all belongs to Him, why are we living as if it belongs to us? Are you being a good Asset Manager? How we perceive MONEY impacts every area of life! It's time to BREAK THE CHAINS...for the love of God!