Yes and no.
A realtor’s job is to ensure they do what’s best for their clients, the home sellers. Part of a realtor’s responsibilities is to prepare a home for sale by making recommendations for staging, decluttering, cleaning, painting, etc to make the home presentable and to market it in such a way that attracts the most buyers. The strategy is yield the most money possible for this property. You want to be sure that it looks better than anyone else’s home that’s also competing for buyers. Once you attract buyers, you don’t want your clients to just take the first offer through the door, so you set a date for offer presentation in the hopes that you will have more than one offer, and your client can choose the best offer.
A smart strategy is the price the house at fair market value, meaning what other homes similar to this house sold in the past 30-90 days. Some realtors will drop the price a little bit (i.e. drop it by $50,000) to attract more buyers who may have the potential to pay more than their desired budget.
Some realtors will drop the price by a ridiculous amount. One particular home was worth $900,000 by comparative market analysis (CMA) but the realtor dropped the price to $600,000 to attract more buyers. The house sold for $1.2million dollars. Another home that was listed at yet another insane price attracted 67 offers.
Creating frenzy isn’t necessarily good for buyers or sellers. It can inflate the market to a dangerous degree because we allow people to buy on emotion, instead of a well-thought-out investment.