No, the house, or any item or service in existence, is worth what someone is willing to give for it and someone else is willing to accept for it. What you think someone should pay or what something is worth is irrelevant unless you are a part of the transaction.

I think a Jackson Pollock painting isn't worth the cost of the canvas and paint used to make it, someone who owns it thinks it's worth hundreds of millions of dollars, someone who wants to buy it thinks it's worth hundreds of millions of dollars. It's not worth $8.72, it's worth hundreds of millions of dollars. The owner isn't literally ransoming it.