This is usually done by looking at similiar houses that have sold recently in the same neighborhood and figuring out what kind of dollar per sq. foot amounts they have been bringing. You can then take that dollar per sq foot price and see if the house you want is priced reasonably in that range.
Sold prices aren't generally disclosed to the public (best that I can tell), this is one of the services your realtor can provide for you since they usually can pull this information. Just ask them if they can pull some comps, short for comparable sells, and help you formulate a fair price.
