This is such a common question.... best advice. Pretend the asking price does not exist. Do lots of research with your buyer agent to determine it's worth, then try to get it for that or lower. It would do no good to tell you to offer 10% under ask if it's 30% overpriced. By the same token don't bat an eyelash at going significantly over asking price if it's still a great deal.
If you are considering an FHA loan, the home will have to meet some minimum habitable requirements and if they are lacking a low ball offer won't be conducive to the foreclosing bank's making repairs and many time the bank outright refuses no matter the circumstances.
Would you like to make an offer?
I understand the property is "supposed" to be priced as is at a fair market price but I can't see paying full price with the repairs needed. Is there a certain percentage one should bid under or do the banks stick to the set price on an REO property?
The bank has in all likelihood gotten an estimate in some form of the market price of the house. If that was an accurate one is anyone's guess. It's possible that the bank is just wanting the place off the books and will take any reasonable offer. You really need to get an agent to give you their best guess at the value based on as many comparable SOLD homes in Waynesboro that have changed hands in the last six months or so. There are a lot of other factors that will come into play. I would be happy to help in anyway I can.
It's possible that the bank is just wanting the place off the books and will take any reasonable offer.