On the topic of crazy house pricing. The Fugly Blue house.
My town is an interesting mix, "old" close in suburb of Detroit. There are a mix of smaller older homes, some in good condition that will stay, some that will become tear downs for houses like mine, moderate sized by current standards new houses. (mostly in the 1,500-2,000 sq ft range). The fugly house built around 1980, it is 2,000 sq ft on a double lot, but I don't think anything has been done since it was built. They put it on the market originally for $299,000 a year ago, rumor has it a developer offered them $250,000 for the land before they listed. It is still for sale, it needs at a minimum $50,000 for new windows, a roof and it doesn't have a garage which is abnormal for the neighborhood. Lets not mention normal people would want to upgrade the kitchens and baths so really it could easily be $100,000+ for "renovations." Same town, maintained house of a transferred co-worker sold in 30 hours for over-asking.