I agree with David Gierlinger's answer.
Also, pick an agent who works in the locality where you are looking. No point in getting advice from other states, or even cities, as the custom may be different.
Don't look at making an offer as a test of wits, or a game. There is not much of that going on out there today in our area. After an offer and a counter it is time to get the real price. In lower price ranges we have a seller's market. . . if you insult them they will wait for the next offer.
Don't plan to subtract what you feel is the value of the work needed from the asking price. The number you subtract that from is the price of what other houses in the neighborhood sold for. The repairs probably are reflected in the asking price. Get real estimates for the work that needs to be done, or have the seller get them if you want to negotiate.
If the house has a bathroom and kitchen that is functional, any updates you have in mind are on you. If you don't like the carpet or the colors, that is yours to change. If one wall is a mirror, it comes with the house even if it has gold veining.