What’s the Difference Between Market Value and List Price?

Understanding the Numbers That Drive Every Real Estate Deal

If you’ve spent any time looking at homes online, you’ve probably noticed something confusing — list prices can vary widely, even for similar-looking properties.

So what’s real? What’s the true value of a home?

As a Keller Williams Everett agent, I get this question constantly:

“What’s the difference between market value and list price?”

The short answer: list price is an opinion; market value is evidence.

Let’s break that down.

1. The List Price: A Seller’s Starting Point

The list price is the number you see on the “For Sale” sign or online listing. It’s what the seller hopes to receive — often influenced by emotion, advice, and strategy.

Sometimes sellers set their price:

• High, to test the market,

• Low, to attract multiple offers, or

• Right at market value, to generate steady interest.

But that number doesn’t mean the home is worth that much — it’s simply the seller’s invitation to buyers.

2. The Market Value: What Buyers Are Actually Paying

Market value is the price that ready, willing, and able buyers are currently paying for similar homes under normal conditions.

It’s based on real data — recent sales of comparable properties, not wishful thinking.

Appraisers, lenders, and agents use this information to determine whether a property is fairly priced.

If your offer or asking price strays too far from market value, the deal can quickly fall apart due to appraisal issues or buyer hesitation.

3. How Market Value Is Determined

As your agent, I run a Comparative Market Analysis (CMA) — a professional report that looks at:

• Recent sales of similar homes within a half-mile to one-mile radius,

• Active listings competing with yours,

• Homes that expired (didn’t sell),

• Adjustments for square footage, lot size, condition, and upgrades.

This analysis tells us where your home fits in the current marketplace and how to position it to sell for top dollar, not just any dollar.

4. Why the Two Numbers Often Don’t Match

It’s common for list price and market value to differ — sometimes by a lot.

Here’s why:

• Emotional pricing: Sellers often attach sentimental value that buyers don’t share.

• Market momentum: In fast-moving markets, prices can rise or fall quicker than listings adjust.

• Agent strategy: Some agents price low to spark bidding wars, others price high to “leave room” for negotiation.

• Condition or upgrades: Two identical homes can vary in value by tens of thousands depending on updates or deferred maintenance.

5. How Buyers Should Interpret List Price

When you’re shopping for a home, don’t assume the list price equals value.

Instead, ask:

• “What did similar homes sell for?”

• “How long has this been on the market?”

• “Have there been price reductions?”

If a property’s been listed for weeks without offers, it’s likely overpriced. On the other hand, if a home just hit the market and is priced right, expect quick competition.

6. How Sellers Should Use Market Value to Their Advantage

Setting your home’s price correctly from the start is critical.

Homes that are overpriced sit longer, require price cuts, and often sell below their true value.

By pricing strategically within the market range, you attract more qualified buyers, create urgency, and often secure a stronger final sale price.

Think of it this way:

Pricing right gets you attention; attention gets you offers; offers get you results.

7. Appraisal Reality Check

Even if a buyer offers more than your asking price, the appraisal must support that value for the lender.

If it doesn’t, the buyer’s financing could fall apart. That’s why I always recommend pricing your home at or near its proven market value — it helps ensure a smooth closing.

Final Thoughts

The list price is what the seller wants.

The market value is what the market allows.

As your real estate advisor, my job is to bridge that gap with accurate data, skilled negotiation, and local expertise — so you can buy or sell with confidence, not guesswork.

If you’d like a free, no-obligation CMA on your home — showing its current market value based on real, recent sales in your neighborhood — contact me anytime. I’ll walk you through the numbers and show exactly how buyers will see your home in today’s market.

John Merrell

📍 Keller Williams Realty Everett

📞 (425) 480-6864

📧 jmerrell@kw.com

WA Broker License #25025188