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@kkg337
Just emailed the estate agent and offered to split the difference between our sum and theirs. We're acting in good faith, and can't (read could in an absolute sense, but not really) afford to bear the burden of doing it all ourselves on top of full offer.
We're at peace with the fact that we're happy to pay what our initial offer was if absolute needs be, but doesn't hurt to ask if - as you say - no-one really wants to walk away. Being mercenary about it, we are both on rolling rental contracts and 1st time buyers, they're in a chain and have a toddler- so they probably have more riding than us on it.