Find another house. Even if you were willing to overpay, if the house is truly over priced it won't appraise. So unless you are paying cash you wouldn't be able to get a loan. Sounds like this seller is fishing for an uninformed buyer. Don't let it be you!
However, there may be tangible assets that represent real value such as geo-thermal heating and cooling, commercial building standard, above code in all aspects, ....of course there may alos exist real, although very irrelevant, constraints on the sellers ability to sell. (they are broke and can not come or are unwilling to come to the closing table with cash to pay off the mortgage).
If this is a community of diversified housing and few annual sales, comps may be difficult to find. Knowing the community value ceiling is really important. You, of course, are aware of the ramifications of owning the most expensive house in the community. These homes, which anchor the value of the community, do not sell very often.
Just a few months ago, a buyer recognized the unique nature of a home I had listed and waived the appraisial contingency and brought $30,000 to the table. You are the only one who knows how important THIS home is to you. Respond accordingly.
If you are financing the purchase the lender wouldn't be able to approve the loan due to the appraisal anyway. You'll find another property quickly and the subject property wil continue to sit on the market.
You could also have a contingency thrown in for an appraisal. So that when the home doesn't come near agreed purchase price, you can walk away with your deposit back. You may also be able to use it as leverage to lower the price.
If you're a cash buyer and don't want to pay 425k for the house when the nearest comp is 380k you'll have move on.
If you're financing, I don't know of any banks that will issue a loan for a house that overpriced. You can use that as leverage to get the home price lowered, most likely though, you'll be forced to walk away and find a different home.
scenario that you can pay for an appraisal and the seller may elect not sell you the home.
There are many houses listed in our market that are just listed and not for sale due to improper pricing.
I always tell my sellers that overpricing in this market is like shooting yourself in the foot ( http://www.dwell-denver.com/blog/overpricing-in-this-market- ) but it sounds like this seller isn't even interested in selling.
Good luck in your search! I know the perfect home will come up!
Dwell Denver Real Estate
Lisa Miller Scott
Sellstate Dominion Realty
1. Does the seller have an appraisal to support their asking price? Also, you've probably already done this, but just in case: Make sure these comps you are referring to are true comps, including not being distressed sale comps (foreclosure, short sale, etc) which will yield a below market value.
2. Any idea if there is a loan on the property? Could be a situation where the seller is simply unable to lower the price as they don't have the funds to pay the delta of your offer price and pay off the loan to convey clear title to you. Then yes, there's some great advice here to walk from the deal. You can't force a seller to sell for less than their asking price.
If the property is underwater, there are resources that can negotiate a short sale even when the seller is not behind in payments. It's an arduous process that the seller may be unwilling to undergo and would rather wait it out until the values come back up.
If there isn't a loan on the property however, and you absolutely love the house, perhaps a sweet seller financing deal would be something that could be negotiated. Seller can get his asking price but you get some bad-ass terms on the financing that end up being a better deal than what your loan financing could get you. Keep in mind, if you get a 30 year mortgage and see it thru to the end you are paying FAR MORE than $425k overall for the home.
These are just some thoughts as it seems you really want this house. All the best to you!
You may see light at the end of this tunnel if the listing expires and another agent picks it up. If they relist, they may do something with the price.