"all-time lows of inventory" is putting it mildly. In some segments there is 0 inventory. For example, right now I don't think there are any 3 bedroom bungalows for sale in the C13 area. As for selling $500k above asking,  it's only because some sellers put prices under market value to encourage a bidding war. The most I usually see is houses selling 100k above comparable recent solds. More than that, it would have to be a very particular location or lot size- once you get over the initial shock,  you kinda understand why. But most houses sell withing a narrow range of expectation +- 100k.