You don't determine the highest price, the market determines it. Not sure what you mean by placing a cap on what the seller could receive.

I don't, the market determines that

The market determines the price by the comps I research.

There is no "cap" the market pays what the market is willing to pay. I sold a home in 2001 that went $350,000 over asking in Palo Alto. No cap!

Why on Earth would you place a cap on the Sellers proceeds????

I think a frutehr explanation or example would be helpful to come up with an answer.

The market determines the value by the price they are willing to pay. The cap is set by what a buyer is willing to pay.  In my market it is common for homes to sell for thousands over asking / list price.   Homes that are over priced sit on the market ... waiting for one price reduction after another.  

1. We can only estimate the max market value for a property based on recent sales, adjustments to same, etc. The market will make the final call.
2. We couldn't if we wanted to. What if there are multiple offers? What if the deal was retooled to include an improvement that wasn't originally conveying? Maybe an adjacent parcel? OR . . . what if the seller is contributing to the buyer's costs, and the purchase price was raised to include that?
We want the seller to net the highest possible number, of course.
What is your reason for asking this question? Maybe in a different context, the answer may vary.

I do a cma and provide a range of value to my clients. Then we jointly determine what makes sense in current market conditions. What do you mean by a "cap?" Who am I to tell a seller they can't get more than "x?" We have no price police here in Charlotte! The market will determine, at the end of the day, what a seller will get for their "asset" and an appraiser will determine if that is fair value for the mortgage.

Why place a cap?  Do you stop the auction when you feel the bid is high enough or do you keep pushing to see what they buyers are willing to pay.

All that any of us can do is suggest a starting price.

You would do a market evaluation on the property. Then recommend listing at that price and generally the seller will want to list a little higher. I am not sure what you mean by cap, but I would never put a cap on the amount the  my seller can receive for the sale.  Their home is only going to sell for what the market can bear.

I am not afraid to suggest Ranges of value and the DOM outcomes !

Myers Jackson I can determine the highest possible market value based on comparable properties with appropriate adjustments that have recently sold. The highest possible market price is based on property demand in a specific market. My recommended list price is always based on the comparable data whereas the final price is based on the market.

Homes sell above list all the time.  Sometimes well above it, even when priced right or even a little over where I'd think they should be.

Market knowledge and current competition has a lot to do with it. Given that condition is not at issue and we've come to terms on price a cap is irrelevant.

This is market driven and based on competition and quality of the subject property. I come up with a value range and talk it through with the seller. Many properties sell at or above list price.

Why would you do that?  I looked to see what profession you are in & most people here are assuming you are in real estate.

You have to look for comparable properties & work for your client to get him top dollar. Go do that.

Being in auctions, you have the perfect way to determine that!  However, even in listing properties, if the market determines the price is a great deal, then you'll get multiple offers, creating an auction type atmosphere.

I agree with Jeff Dowler  and Julie Larson Realtor® Sarasota FL 941-882-0322 said.  Why would you set a cap on what the seller could receive?  A

Ditto to what Julie Larson Realtor® Sarasota FL 941-882-0322 just said....

Agree with Julie.

You evaluate the recent market sales and competition provide a range based on the information to the sellers. 

Our market is crazy right now, and usually I set a fair market value and add some for those who will be bidding over this amount.

do the best CMA as possible

The buyers determine the price they will offer based on supply and demand . The lenders may not agree on the value sometimes.

I agree with others; the market determines the price.

It's not up to me, I do the comps to tell the story - why would I cap the seller?

I would need a bit more information to answer this.

The market will determine the price. No caps for sellers.

I never place a cap on anything, in the end what a property is worth will be determined what a buyer is willing to pay for it. I use a set of comparable sales, let them know the homes high value, what to ask and what the possible selling price will be. 

Jeff Dowler nailed this one!

More or less. The more houses you see and sell, the more you understand how to adjust the price comparing to comps in the area. 

Myers Jackson - why would one want to put a cap on what the seller could receive - just wondering...

We don't make that determination - the market does!  Buyers often pay more than list price, whether the seller has priced it above or at their 'market value' opinion.

The market would determine the price.

 CMA for cookie-cutter houses in subdivisions with several recent sales.

Appraisal for hard to comp properties (or stubborn sellers).

Cap on what they can receive?  Not sure what you mean by that, Myers.  "Net Listings" are illegal in most states; I don't think that is what you meant.  Cap on list price, yes.

Why would you put a cap on it?

Well I research comps and discuss the market with the seller so they can determine what they think is a fair price at which to list their home. I don't have any business placing a cap on what the seller can receive. 

By a market comparison and what is trending it that area and type of home. There have been times when the market in the 'moment' is saying say 500K but I know market is trending up in price and buyer demand is strong. Multiple bids are a big possibility in these cases and who knows how high a buyer will go up in price to procure the home of their dreams.

The market determines the price.

You suggest a price for your seller based on market analysis. The marketing strategy adopted is something your seller approves. Typically the asking price is what the market determines the property should sell for. Sometimes we take listings where sellers are "testing" the market above a known sales price - but this is not advised. Taking a listing below market value can result in multiple offers which drive the price up. We try to get the best possible price at the best possible terms for our sellers - but this is market driven.

I do my homework and make sure I use the best sale comps for my seller . I discuss with my seller and advise what I think the house should list for and sell for but am not sur what you mean by cap ?

Would you place a cap on what the seller could receive?

I don't have to. The buyer(s) or lender will.

What I must do is determine is this is a real seller. Inspired pricing does not translate to 'motivated seller.'

However, being able to determine the ceiling price for a community is possible.

Our price is the best estimate, but there is no cap in at that moment the demand is particularly strong for that specific property.

Supply & demand has the final say. Meanwhile, going out at at FMV or a tiny tad below brings instant responses and takes us where we have to go..$$$

Market will let you.

I tell them I will charge X% listing commission based on my through analysis with adjustment and measurement of home.

Someone wants more than the market price I will charge Y% for additional marketing cost (Y>X). My valuation is top in the area. Last 3 years I did not have a single lender disagree with my analysis. 

Any sold price higher than appraised value is a result of staging, features and aggressive marketing. You want to hear what you think and not open to local expert input. Go get a license.