How much should I offer?

[Account Closed]

Looking at a house that they are asking $69k for. It needs a lot of work, but, would be worth substantially more when finished. Nice old farmhouse on a few acres. Given the condition, I'm really not sure how much to offer. Tax value is $59k, and it seems like most livable houses around here go for less than tax value, not more. This one is not livable. Not sure the complete extent of the damage yet, but it needs at least a new roof, HVAC system, and every surface inside needs to be refinished or covered up. (over 3000sq ft worth) Eventually I'd like to make it a duplex. 

I guess I'm not a very good negotiator, and would feel a little bad about offering $40 or $50k, but I'm thinking that might be what it's worth. Little old lady owns it, selling through a realtor. Is there anything wrong with offering too little? I guess the worst they can say is no. Better to start low and work my way up? Is there a normal amount realtors add for negotiating room? I'm not sure how much they took into account the current condition...

I realize every area is different, and where I'm from houses often sell for more than the asking price - I guess that's why I hesitate to offer so little.