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Like willair says, this is the thing that would be a concern to me. I would have a builder look at it and if it is a money pit, walk away. The rest is easily fixed (likely).

I don't think it is reasonable to ask them to do a termite barrier. We had a buyer try to pull this on my parents when they found termites in a tree in the yard. They wanted $5K off the price, our pestman said he could do it for about $2K, but my mother stood her ground and said "like it or...

Really??? :eek::eek::eek: I'd say you have two chances of that... Buckley's and none. If I was the vendor, I'd be telling you where to get off (assuming I wasn't absolutely desperate to sell). Those things are small problems. You knew about the issues when you put in your offer, didn't you...