Fair price is what you are willing to give for it that the owner will sell for...:thumbsup:
With an older machine it truly is a crap shoot. If you are not familiar with this type of equpment, you may want to have someone who works on them go look at it with you. Backhoes are big, heavy, and often expensive to repair. While the systems on the older ones are fairly simple, they have lots of large, buky parts. It will take more than a 3/8 inch socket set and a few screwdrivers to work on them. If you can't do most of the wrench work yourself, it will nickle and dime you to death.
Look for slop (wear and play) in pins, slipping transmissions/clutches, hydraulic leaks on cylinders, hydraulic hose condition, previous welds and repairs, engine blowby, etc. Unless you are REALLY ambitious, bigger things mean professional help ($$$), smaller things (like hoses) you can usually fix, but they may be expensive (just replaced a $65.00 hose on an excavator..).
Then there is the size and weight issue. Most of the construction grade hoes are north of 13,000 lbs (some WAY north..) - probobly out of your ability to transport it safely. So figure on paying to have it delivered and moved for service.
It is usually better to spend a little more to get a machine in good shape than to buy a "project".
But after all that, I have seen some machines with many years and hours that just keep on running... Once you get more than about 10 years old, you are paying more for condition than model. But you are right, once you get one, it is amazing what you can find to do with them.
Best thing to do is see what machines in your area are going for - check craigs list, ebay, local used equipment yards, etc for price and condition - once you get a feel for what stuff goes for in your area, then find a machine in good shape that you can afford. You can also check the big auction companies (Ritchie, Iron house, etc) but they usually deal in recent/current models, and less in vintage stuff. If you have a CAT or JD (commercial) dealer near you, talk to one of their salesment and tell him what you are looing for - they occasionally get offers on trade in stuff and you may get lucky there. Hope that helps!