I just got an offer on my house, and they want to close June 1st, Can you give me advice on what to do?

We bought the house 5 years ago, paid $132,000.and put about $4,000 into improvements in the house.A year ago it was appraised for $120,000.We had an offer for $110,000 and did not take it.We never thought that the houses in the neighborhood would drop even further.There are lots of houses for sale for $85,000 but not in the condition our house is in.It has been totally renovated, with a new garage, new windows, new deck, finished basement with extra bedroom and extra bath, but , the housing market is depressed.We put it on the market in February for !09,900, and we did not get any offers.Our realtor suggested to drop our price to 99,000. That was the day before Easter.Today we got our first offer BUT, its for $87,000.We have to pay real estate fees, costs, etc.they are going FHA, so we will be under $80,000.That is more than a $50.000 loss.I am worried that the market will even drop more next year, so I do want to get rid of it.Should I counter offer, like to $95,000? I don't want to lose the sale, but, the housing season just started and they love the house.Should I stay firm at $99,000 and see what happens.They are not going to find a cleaner home for that price.