How do you determine the asking price for a home when there are no comps?

Nothing in the area has sold in the last year & nothing is currently on the market....SO how do you determine the asking price of a house? This relates to another question I posted earlier. I'm looking at buying a home where I feel the seller has overstated the value by about 25k, mainly because they claim the house has 4 bedrooms when it only has 2. I'm not willing to consider rooms in the basement without closets as bedrooms.
I've put in an offer that's very fair for a 2 bedroom home. This house has been on the market (and sitting empty) for quite some time now. A year ago, the asking price would have been fair, but not in today's market.
How do I determine an offer price, and how did the seller even come up with the asking price to begin with?
I want to protect my investment, but the house needs about 50k in renovations, kitchen & bathrooms (1 bath isn't even usable). I couldn't sell the house at a profit in 10 years if I bought @ asking price + made improvements. HELP!

If the seller is considering rooms (without closets) as bedrooms they will have a shocking discovery when the appraisal is done, because rooms without closets are not bedrooms, and no lender or appraiser is going to overlook that. It sounds like you might want to talk to the seller or their agent (if using one, which seems doubtful) and address that. But since you've already made an offer you'll probably just hear back from the seller that way instead. While real estate has to be done on paper, it doesn't mean you can't verbally communicate prior to making the offer.

Yeah that's a common tactic, say that you are getting another offer to try to create the illusion of "competition". Stick to your guns, it definitely is NOT a seller's market right now. Report It

You may need to walk away from this one. Remember - you can't spend more for a house than it's worth. Look for other areas in the city similiar to this one and other houses that are relistically similar and not what the vendor claims. If given that information, they're not willing to go lower (and a lot of people have a really inflated idea of what their house is worth and won't listen to their realtors) you may need to walk away and if it's still on the market in three or six months and you still want it, over again.

When I was licensed in appraising these are the folks I used to take care of situations similar to yours
http://www.marshallswift.com/
You might want to contact a licensed appraiser in your area for additional guidance.
Best of luck

I've recently purchased my house and thought the asking price was high , but i later found out that if you are getting financed the bank will only finance at the appraised value so i would suggest hire an appraiser to find out how much the house is worth then what ever he/she comes up with is the true vale on the house . the appraiser in Florida cost 500$ and could sometimes be added to your loan .

First of all, there is no law saying a bedroom has to have a closet in it as long as it has adequate lighting, heating and ventilation, and it is not a passage way between two areas. I bought and sold a home a few years ago in which one of the four bedrooms did not have a closet. I had no problem getting it appraised as 4-bedroom. Having said that, you can still use this to justify a lower price since the common sense is that a bedroom has to have a closet. You can make any offer you feel comfortable with. After all, it's your money! If the house needs so much repairs that you won't be making money after repairs, you should either make a low offer or look elsewhere.
It's a good idea getting the property appraised.