The irony in the situation that you describe is the importance most people (agents included) put on asking price. The asking price of a property only serves one purpose. It is an advertising tool. If it is not drawing offers, it is a non-functioning tool and needs to be adjusted.
The strategy you describe is most effective when there is a relative disconnect between buyers and sellers. In that case sellers can become frustrated more easily and be willing to opt for speed over financial prudence. In the case I described there was some element of that happening.
Some buyers really think that because the market favors them, they should just knock 10% off any asking price. This is dumb. Sometimes knocking 20% off is a good idea and sometimes adding 10% is a good idea.
For example, a 2 br condo in North Park listed for 300 is a case of the former and a house in Kensington listed for the same is a case of the latter.
A buyer really needs to call his own shots and make decisions based on fundamentals.
On a personal (and cynical) note:
Everyone thinks they will be the one who gets the crazy deal. This is always unlikely. The vast majority of deal are within 1 standard deviation of sheer market. Hoping to be outside that deviation is like hoping to be the one freshman assigned to the girls’ dorm.
