Sure, it's worth putting in an offer. Now, if it's priced "properly," you're only offering 70% of its approximate value. But investors do that all the time. Most of the time, we get turned down. But some people will accept. And, as Myke says, the asking price may or may not be close to the property's value. It could be lower, or even higher (as in the example he gives). So, before you think that $350,000 is an absolute bargain, you really need to know what it's worth, and therefore what price--if you could get it--would represent a bargain.
Being on the market for 55 days doesn't mean too much one way or the other. Houses are taking longer to sell, and 55 days in most markets is less than average. Even if the days on market were much longer--say 200 DOM--that could mean a number of things. On the one hand, maybe the sellers would really be motivated to sell. On the other hand, maybe they're stubborn and holding out for "their" price.
I do disagree with Myke on the termite contract. In some cases, people simply have termite contracts, whether or not they have termites. And even if the property did have termites, termite damage is repairable. Sometimes it's expensive, sometimes it's not. Depends on the extent of the damage. Obviously, have a home inspection done. And have pest inspection, too. But that alone wouldn't stop me from making an offer. (In fact, anything that scares off other buyers that's fixable--up to and including structural problems--is great. Just so long as I know how much it'll cost to fix, I can factor than into my offer.)
So, determine the property's real value. That's your ceiling price. Make an offer somewhere below that.