First of all, I would not accept Tulia or Zillow's values. They are not accurate. As the others have stated, there are many reasons why these homes sell for much less. This is why you should be working with an agent who can look at the data on the property and explain the reasons for the sales price. Many of these homes have been vacant for long periods, have had pipes freeze, water damage, mold, copper stolen, etc. I have seen and listed homes that need a complete rehab. If you see "CASH ONLY" in the remarks, you can be sure it needs a lot of work.
I hope this and the other answers help.