Great advice from Larry.
So, if I follow you correctly--and let's say the house was priced at $500,000--the comps were at $400,000. You offered $500,000. The seller countered at $560,000. Your agent tells you to agree to $560,000.
You're concerned that the appraiser might come back at $560,000.
If that's the correct scenario, run as fast as you can. Gee, doesn't ANYONE remember the market in 2005 and 2006? Hey, fellow Realtors, this was what was happening right before the bubble burst. The market's overheated, the seller is greedy, and it's a game of musical chairs.
Do NOT rely on the appraisal. It's true that appraisers are more conservative now than they were back in 2006. But plenty of appraisers will still rationalize: If there's a willing buyer and a willing seller, then (absent a huge amount of other evidence) that's about the right price.
Yes, the game is rigged. Absolutely. Appraisers see how much you and the seller have agreed on. If the game were fair, the appraiser would have no idea. The appraiser would do his/her job based on the comps and market trends. But that isn't the way it works. Besides--let's be blunt here--appraisers hang on to their clients by facilitating transactions. How long do you think an appraiser would be called upon by a bank if he/she found that 8 out of 10 houses didn't appraise for the contract price? Not long.
As for other agents here who might say, "Hey, you don't know Hayward." Darn right I don't. But if I smell a skunk, I don't need to know that a skunk's been around, either. I've seen that pattern before, and not so long ago.
Your gut is telling you there's something wrong. ("I am really not comfortable. I believe the game is ready to be rigged again.") You're right, of course. But even if you weren't, I'd say: If you're not comfortable, don't do it.
Hope that helps.