That is where you Realtor can be your best advocate. They can pull comps in the area of like homes both recent sales and pending transactions to give you a sense of the market place. They can help to guide you in your decision of what is a good and reasonable offer. The market is moving very quickly right now, therefore you also want to use a local Realtor to the area so they can advise you what is the most current activity happening in that micro market. Things like are there multiple offers taking place, is the average two multiple offers or 17 offers? The strategy would be very different for each. The market has heated up quite a bit, strategies change based on this and the specific market area. There are a number of options on how to contruct an offer and make it competitve. Work with a Realtor you feel comfortable with and talk through the details.
If you are considering buying property in the Oakland/Bay Area, and I can be of any help, I can be reached at Fran.Donhue@BHGhome.com.