In a short sale the seller usually wants to sell their home as quickly as possible, but they also don't want to accept too low of an offer because their lender still has to accept it, and if their lender knows that the market value is higher than the offer the homeowner has accepted, they'll reject it and it'll start part of the process over again.
Now for this home it may have been the listing agent learned that the seller's lender will accept a certain price, and so in an effort to get it sold quickly it was reduced to that price, or perhaps they really need to sell it quickly, and they are lowering the price just to get any offer and see how far the seller's lender will go with it.
With a good real estate agent they'll be able to feel out the seller's side to determine if they are just "tire kicking" the seller's lender into seeing how low they'll accept because the property needs to sell quickly, or if they truly will be able to get the seller's lender to accept that price.
Please see my blog for tips on buying a short sale.
Iy never hurts to try!
On short sales, sellers and their agents should be working together to identify potential buyers and in doing so SHOULD be keeping the pricing of the home in step with the local real estate market. The final number has to be reasonable and defendable to the lender.
This may or may not apply to all situations. In those that have been decreased with little attention paid to the local RE market, they will find themselves in a position to renegotiate the final price with the lender.
In short, some prices are accurate reflections of the current market while others..............well, let's say, it is fishing season!