Buying a House for 40,000 ?? 600 in Rents??

[J C]

Hello everyone, i had a friend this mornign who was trying to sell a house he fixed and rehab. he put the house up for sale at 64,900 which was too high in my opinion. he then dropped it do 55,900 and noone inquired. im thinking its worth around 40,000. he says he'll sell it for 40,00 no dollar less then that. Using the 2% rule i should only pay for this house at 30,000 max. This is a all cash deal.

So should i pay for the 40,000 ? is it still worth it or do i offer a smaller number and stick to my guns? and if i should offer a lower number what would u offer max