Distressed sales regardless of the type are major players in the real estate market as many buyers feel this is where to find good values. Thus, as the seller of a standard sale, you will need to be somewhat competitive with these properties.
You do have some things going for you. First, distressed sales are noted for not having had the best care and in many cases, been vacant for months or even years before reaching the market. With this said, making your home stand above all others in condition demonstrating "pride of ownership" can help sellers get an edge on others. You'll likely heard of the phrase in real estate, "location, location, location." Well in this case, sellers should be reminded of the following,"condition, condition, condition" because this will get the attention of buyers that may be considering distressed sales.
Additionally, short sales are often priced at a level which is lower that their lender will approve, thus, the eventual selling price will be considerable higher that the listed price. This is not something commonly known by buyers but it is reality.
Essential to selling in a competitive market is the importance of pricing the property right and making it "shine" in an effort to stand out above all others.
Hope this is helpful,