Our position will be difficult if they are politically powerful or having criminal intents. If we are vulnerable they will tempt us first, in case we don't fall to their trap, then threaten us. If we still go in our way, they will put spokes by spreading bad things about the property to the prospective buyers and drive them away. At last without seeing any other alternative we will be forced to sell it to the same person, who will now reduce the price much further.
In your case you may stick to your price and not bend down. If he is ready then you can sell it to him. You may tell him that you do not have any objection to sell to him, but want the price quoted by you. Stand firm.
In case he is adamant not to allow you to sell the flat, and driving away prospective buyers, then mortgage the flat to a bank and get loan for your needs. Fix a very easy repayment schedule.Then leisurely contact some 'strong' brokers and sell the flat a still higher price ,getting concurrence from the bank.
Before that discreetly asses how other neighbours attitude to your friend as well the other person. That will be an important factor to decide further course.
I think, when it comes to financial transactions, there should be a clear line between money and friends/neighbors or relatives. Because, the moment people realize that it is a distress sale for the urgent need of money, they try to drive the price down. If possible funding can be arranged via a loan with the same papers of the home and then the children can repay it.