A .25 reduction equals 1% of the purchase price ($6,000).

And when you make a reasonable offer it is as likely as not to be ignored or countered with a reduction of a few hundred dollars. 

Well, my read was that over time, accounts that had gone without activity would receive a reduction in their influence, so this one rather than being at 50 should be more like 0 - or even below!

Maybe savings a commission side or reduction.

The owner is still in the house, you own the loan, and you can modify the loan to the terms that you agree upon aka Principal Reduction.

Can you get a tax reduction through depreciation on the property too? 

@Nicholas LaytonI do not think is an issue of ignoring all of the other benefits (debt reduction, equity buildup, depreciation, etc.).  

Plus you get the principal reduction as well - another few hundred in your [paper] pocket each month.

The security deposit increases basis of the property (I get the tax advantage through depreciation but have to lay out cash to cover the security deposit) and the pro-rated rent was a reduction in the cost basis of the property.What have you all of done in these situations?

Fannie Mae generally prices high, then does price reductions in $10k increments on a fairly regular schedule until they start getting offers.