Unless I'm wrong, the '92 1000 had a 7-sp freewheel with downtube shifters. While this "technology" is perfectly fine and reliable for general riding, it's a bit limiting if you ever get the urge (or have the need) to upgrade components.
My first concern would be corrosion. Don't bother with it if you can't move the stem and seatpost. Having either of these fuse in the frame/fork can spell hours of frustration and added expense.
My second concern would be the wheels. If the bike has lots of miles on the original wheels, there's a good possibility that the hubs are at the end of their life; this could be even more true for wheels with less miles and inadequate maintenance. Getting new wheels/hubs for a 126mm spaced aluminum frame isn't easy or cheap.
Finally, I'd want to check for signs of stress or damage to the frame and fork. If the frameset is compromised, there's no point in buying the bike at all.
And what exactly does a "complete overhaul" mean? I'll tell you one thing; it doesn't mean the same thing to everyone; there is no standard. I would only advertise it as such if all of the following was done:
-New cables and cable housing
-New chain and freewheel or cassette. Chainrings, too, if they're worn
-New brake pads
-Headset overhaul: clean, grease, new bearings, adjust
-BB overhaul: same as above (or replace if cartridge BB)
-Hub overhaul: same as above
-Wheels trued and tensioned as necessary
-Clean and lube seatpost and quill stem
-New bar tape
-New tires/tubes (unless the current sets are in fine condition)
If that work was done, the wheels have lots of life left in them, there's no concern about the integrity of the frameset, and the bike has otherwise received a reasonable amount of care during its life, I'd say the asking price is probably still a bit high but not excessively high. Depending on your region, $200-275 would be expected for even an outdated, mass produced aluminum bike with that much work in it.
On the other hand, someone's idea of an overhaul might be a good cleaning and lubing in addition to new chain, cables and brake pads. That's minimal work to me and is suggestive of deceptive selling tactics or a seller that just doesn't understand much about bike mechanics and maintenance. The price would have to come down substantially for me to buy it. Probably not more than $150 if it's roadworthy as is but in need of some real work in the near future.
Rather than worrying about the price too much, ask yourself some questions: Am I capable of doing most repair and maintenance issues myself? Or am I financially at the mercy of the local shop for every task? Also, how bad would I feel if the bike needed new wheels or other costly components in the near future? Would I be unable to afford the repairs to keep the bike on the road? If there's any doubt, be very careful when buying older bikes (used recent models are less of an issue altogether).
