Just so you'll know, the bank foreclosed on this property at $334K in Sept 2007.
If you want to offer $45-50K, go ahead.
But how much do you know about this property? I saw a duplex on Wallace that was listed at $37K. I thought it was a mistake, until I found out that the house next door, as a few other houses on that block, are sliding down the hill. With the next heavy rain, it might be part of a mud slide.
What's stopping you from writing an offer as close to asking price as possible? Can you build a house on a lot for this price?
What does your realtor say?