Of course there is a strategy to pricing low.
However, where I live, people usually price low if they are holding offers. Meaning, they'll list for a limited time and the owners won't see any offers until the end of that time, at which point they see all the offers at once.
They usually price 15% below what they want, and then the hotter the market, the higher over asking the top offers will be.
Hot markets encourage lying and fraud regardless of whether or not a listing is listed low. That's just the nature of insane markets, crazy shit starts happening.
Hot markets suck for buyers, they just do. I'm sorry you're stuck trying to buy at an epically bad time. I know it's frustrating.
I realize that you are ranting and it is frustrating. However, I would try to come up with a strategy. I agree that lying and fraud are more likely to occur in hot markets. Listing price doesn't seem relevant.
I bought a foreclosure in June 2018. The bank listed it too low on purpose. However, I was able to use this too my advantage. In psychology, people will anchor to the list price, even though the list price has no real value.
The median price for the neighborhood was around 800K. The bank listed the home for 549K. The house needed about 100K worth of work or 50K if I did some of the work myself.
We offered 603K, which was 10% over asking. After all bids were collected we were told that there were 9 offers total and we were #2. After one week the highest bidder lost interest and the deal went to us.
The house appraised for 615K "as is". We made 50K of necessary repairs and it was immediately worth 750K. After 3 years of appreciation, it's now worth around 950K. The median price of the neighborhood is now around one million.
In the end, I was thankful the bank listed the house too low. It's pretty much the main reason why I was able to get the house. We had previously looked at around 20-25 houses for about 18 months.