When it was listed at $88K, it may have been incorrectly priced. If it is a short sale, the listing agent may have listed it really low to generate offers and possibly a 'bidding war'. If it is a short sale, the short sale lender(s) who approves the short sale will have a BPO or an appraisal done first to determine current market value. Before you submit an offer on any property, have your Realtor do a Comparative Market Analysis (CMA) using Sold comps within a 1 mile radius of the property that have Sold within the last 3 months. This will give you current market value - base your offer on this, not on list price which may be intentionally too low (and if a short sale will not be approved by the short sale lender).