Hey, Brian. This is a very interesting question. Specially when you go to a condo building where typically, you find identical units below and above the one, with great price differences between them.
Sometimes, you can justify a higher price because the view in a much higher floor is usually that much more spectacular. Other times, the owners of the one unit in a lower floor may have done so much more to the unit, while the one in a higher floor may need so much work.
In this market however, I also find that many of the criteria once used to determine price between units (even in the same line of the same building), have literally been, blown out the window.
With so much inventory, buyers and sellers are finding different points of agreement. Some of the circumstances have to do with repossessed property sellers (usually lenders selling their REO or Real Estate Owned), motivated, pre-foreclosure sellers (typically owing more than the property is worth and selling in a Short Sale), and regular sellers looking to move for other reasons - all require different approaches.
By the same token, buyers come to play with many different levels of sophistication, reasons for buying and abilities (to buy cash in particular).
In addition, one similar building may be in financial chaos whereas the one next door is doing quite well. Typically, the one if financial chaos can only offer buyers the opportunity to pay cash for the units in that building since most lenders will not risk making a loan in a building in distress. In addition, there may be too many renters and/or too many owners behind in their maintenance fee payments and/or the payment of assessments for common area repairs, for instance.
Then of course, you may have other building and unit features that affect price such as upgrades, parking, balcony as well as facilities and amenities.
Finally, there is always that interaction between what the seller wants, needs or thinks he/she can get for the unit and what the agent is able to convey and educate that seller the unit can sell for. Unfortunately, many agents find themselves unable to help the seller understand today's market forces and how to properly price a unit for sale.
In the end, it is "the market" (like it is in the stock market), that determines what the property will sell for. The right formula is - what a ready, willing and able buyer is willing to pay for a unit, when matched to what a seller is willing to receive. With good statistics and factual data, a strong, professional agent like myself is able to let the seller discover by him/herself when a deal is on the table that they should say 'yes' to.
If the seller is on the market to sell (as opposed to simply having the property 'for sale'), and is open to listening to their professional real estate representative (as they would a competent doctor for what ails them or attorney for that legal headache's solution), there is no reason why a qualified buyer could not have the deal they want in today's market and for the seller to move on, head up high, and also get what they want considering today's market.
Seller's of a particular stock who must sell on a particular time/day can't get more for that stock than 'the market' (buyers), are willing to pay based on the news and circumstances of that day. Given time and other variables, that transaction may take place at a different price. If it must happen at that moment, the transaction can only happen based on what's circumstances dictate then.
Therefore, sellers must remain honest with themselves and carefully evaluate their motivations for selling with their agent and be clear as to what market forces are affecting sales. Buyers must listen to their agent and work with one that can hep them capitalize from today's opportunities.
Remember: Luck, Is When Preparation Meets Opportunity
ALL THE BEST :-)