The house is also in an up-and-coming neighborhood, and is likely priced too low simply because of the nature of the house and due to the fact that its not in great shape cosmetically. 

You're doing cosmetic stuff, not rebuilding the house.

The house needs a real good inside/out cosmetic update, maybe some walls modified etc.

He's offering $300k minus the repairs he sees are critical, not cosmetic. 

You may develop a few connections or possibly provides this service to an investor looking to move into larger rehabs but doesn't know much about construction past a cosmetic rehab. 

Repair doesnt look that bad, just cosmetic like paint and stuff. plus it wont be a living space anyway.

To one that needs cosmetics.

I prefer to stay with the more "cosmetic" rehab properties, not the total rehab "reconstruction" projects that require a lot of expertise and capital.

I have zero experience but I know I would like to try to connect with some experienced people who can help and guide me through fixing (not gut rehab, just cosmetic fixes) and flipping in the Chicago area as well as consider buy and hold.  

I don't know how much work your property needs or what your timeline is like, but if you have some leeway, I would start him with some cosmetic work before you have him moving load-bearing walls or replacing your roof.