Not an agent or anything but I can see a couple things contributing to why the house isn't selling.
From a design POV the house looks outdated. The houses that have sold next door, and several around the corner we're all modern on the inside. Now granted those houses we're smaller but looking into the mind of a buyer they're probably thinking they would need to update the carpets/flooring and maybe the paint/trim as soon as they own the property. Make's it a little harder to sell. Good thing is this is easily fixable. The most cost effective thing I would do would be to get a staging company in to set up their own furniture. I know that you have your furniture in there but I think a modern look will help the vision of potential buyers. I'd simply paint that trim and try to a more modern look, currently it sticks out while looking at the pictures. Getting new carpet is also an inexpensive option and could help sell the property.
The second part of the equation is the house itself. It seems to be the most expensive. That's fine but when you combine that with the fact that it's outdated it might scare some potential buyers away.
I wouldn't fault your step-son too much with not selling the house right away I can see where he's coming from. Most likely buyer's agents are telling them it's not worth that price and to under bid, like the example you gave above. It might require some combination of a lower price and a small upgrade but you should be able to sell the house. Good luck!!
