My advice is not to get caught up on asking prices, but rather use the tools you have available online through public records or use the services of a competent buyer's agent to determine a value for the home you want to purchase before you make an offer. Also, be sure to consider any major repairs that need to be made.
The bank owned properties in my area tend to be listed and then the price continues to drop until they sell. I'm not saying that is always the case, it may be different in CA, but the banks don't want to hold on to these properties. They are just liabilities on their books.
If you feel that the home is priced right and you consider the current asking price to be a good deal, then use your best judgment on how hard you want to negotiate down from the current asking price. The risk of a real low ball offer is a rejected offer from the bank and someone else may end up buying it before you do.