There are some areas (not many) that are seller's markets. But, like Julian and the others, I'd bet that you're in a buyer's market.
Still, no reason to be confused. Simply, the seller with advice from the listing agent (the seller's Realtor) decides the listing price.
Some sellers are unrealistic about what they think their house is worth. And some (not many, but some) agents "buy" listings. That means they'll tell the seller that the home is worth more than it actually is. So the seller hears two agents say the home is worth about $500,000. One agent comes in and says it's worth $550,000. The seller, who wants to get as much for the home as possible, lists it with that third agent at $550,000. Problem is, the house is only worth $500,000. So after two weeks, the agent suggests to the seller that they drop the price.
Before you settle on a Realtor, you should consider talking to 3 or more to get a more complete picture of the housing situation where you are, and to make a decision on which one you'd like representing you.
Hope that helps.