In every kind of market we have in Real Estate all Realtors and Consumers have to deal with the issue of what is a "Reasonable Offer". As a Buyer or Seller, do you know what your Realtor thinks is a reasonable offer? In most cases I would say Consumers and Realtors never discuss this issue prior to signing a Agency Contract and they probably don't even discuss it during the Contract time. In most cases what is a reasonable offer will only come up when either the Buyer is making an offer or the Seller is having to review an offer, it's at this point that this "sticky" issue can arise. This can not only put the Buyer and Seller at odds with each other, but can actually involve the Buyer/Seller Agent with their Client.
Everyone has their own definition of what is a reasonable offer to make or what is a reasonable offer to accept, and if your a Realtor (especially in this market) you should be discussing what your Client thinks is a reasonable offer. If you are not then when it's time to make an offer, you as the Buyer Agent may find that you have an unreasonable Buyer (in your opinion) and the same thing can happen on the Sellers side. So what do you do when things like this come up, the answer is to not allow them to happen. Communication is key to a successful transaction and as Realtors you should know what your Client considers as reasonable, if your a Buyer/Seller and your Realtor has not discussed this with you then now is the time to bring up the issue, so you know where he/she stands regarding this topic.