First thing you need to check is for rust in the tank? If it runs well $300 is a fair price.
Put the bike on a bucket or stand. Then check swing arm bearings and wheel bearings. Then move to the front and see how tight the front is. See how much adjustment is left on both front and rear brakes. Also how much chain adjustement is left. Where was the bike stored? Inside or Out? Does it read miles on the guages? You can tell right away if it is a barn find or a beaten to hell old bike. Will the owner let you take a compression test? <-- I would push it hard for it tells you lots!!!! Ride it and make sure it has all 5 gears in working order. The working street legal bike will bring a lot more than a it could be street legal bike. More so in the vintage bikes like this.
If it is a tight and solid bike. And all the tacs and guages and like work. Then $375 is a very good deal. Look at it like this. The bike looks complete with all the lights for street legal. Most of these bike that stuff is missing or broke off like the turn signals on this bike are. The seat look good as does the paint and fenders. Headlight glass looks busted out. I do not see any rust which is good. It's looks really clean if you ask me. Does is have Electric Start? There is plenty of parts on ebay for this bike as well. You should be able to get anything you need pretty easy and cheap. original turn signals for this bike will be high priced though. Consider some aftermarket ones. The seller said he put a kicker and clutch lever on it. Check his work good, Make sure he did not weld one on for a fast fix. If I remember right. This bike with no title and DMV is not a problem in Wahington State.
Also if you buy it to restore it. Try to save the original paint at all cost. Even if there is dents. They are worth more original. I see these and the Yamaha's in nice original condition street legal with low miles sell for over $1000 to $1500 all the time. How far this bike is away from that? Only you can tell by looking at it.
I do know if I bought this bike to part on on Ebay I could double my money easy.
Your bike is missing turn signals and has a busted front fender.
http://www.bikez.com/motorcycles/suzuki_ts_125_1975.php
Displacement: 123.00 ccm (7.51 cubic inches)
Engine type: Single cylinder, two-stroke
Power: 9.60 HP (7.0 kW)) @ 7000 RPM
Top speed: 110.0 km/h (68.4 mph)
Compression: 6.7:1
Bore x stroke: 56.0 x 50.0 mm (2.2 x 2.0 inches)
Fuel control: Port control
Cooling system: Air
Gearbox: 5-speed
Transmission type,
final drive: Chain