hmm, well. I bought my first 1977 550 for 400 bucks with oil leaking everywhere.
Then I bought my second 1976 550 for 375 bucks with only 10,000 miles and no leaks.
So, offer a little less, try and deal with him, whats the worst that could happen.
Not saying that is not a good deal. I would definitely look into the kick start not working, because if your electric start stops working you definitely going to want that. Return spring maybe? Not sure never had any problems with mine.
Also never had anything like a key being loose in the ignition but, I did see an ignition on ebay not to long ago for like 20 bucks. However then you have to get a key made for it. Or just ghetto rig it with some duct tape or a wire. I personally wouldn't worry about that to much.
In conclusion, offer a little less, nothing should be really hard to fix, and good luck with gettin the bike.