Do you know what model it is? That price is hefty considering the condition. I try to avoid buying old thinkpads over $150AU if possible.
Generally I will try to get them under $100AU. That's considering that they are usable and in working condition.
If it were a newer model like a T480 I'd be willing to spend between $300-$350AU. But it would depend on CPU and Display Panel used, as well as the condition of it, of course.
You could try figuring out what parts need replacing and seeing how much those parts would cost on eBay, Gumtree or AliExpress (if you're comfortable with this final option).
Edit: It honestly looks like someone bought a laptop, it got damaged so now they're trying to get their money back by selling it on FaceBook Marketplace. I'd be careful with this seller.