Is this frame rot bad? Im looking at this used subaru for $8000 with 85K miles and I wanted to get other opinions about this picture.?

No it is not bad.  When worried about stuff like this have your muffler guy check it out. If things need fixing, he will do it with a torch and welding rod in about ten minutes.

I had a similar looking part replaced by Subaru under a recall. Check if it's not been missed.

Actually having compared it to mine, I think it’s a the rear subframe . Mine is less corroded than that and I got an advisory on it at the MOT . ( fir non U.K. , it means it’s considered roadworthy just now but will probably need attention soon.

That's about standard with what you'd see in a Canadian vehicle, which was run in the snow and salt of a Canadian winter. Was this a Canadian vehicle? By the standards of Canadian vehicles, it's not bad, actually pretty well maintained. American viewers must be horrified by what they're seeing, but to a Canadian this is nothing.

If it was just on that single easily-replaceable part then if the price is fair for the year and mileage then I’d negotiate a reduction to fully cover replacement with a new transaxle support brace (and then fit a good used one!).

But that photo also shows significant rust along a welded subframe seam above/behind the driveshaft joint. The limited view shown by the photo suggests a car which has been used in a salty environment or in a region where the icy winter roads get salted. It could also be caused in an area where there’s regular rainfall but where the cars get put away wet in warm garages, as that also promotes rust more than if kept outside with good airflow.

Modern car designs are far more corrosion-resistant than ever before, but there are a few manufacturers who are at the back of the class in that respect. Subaru is one of them.

Personally I’d immediately look for other examples, but if you still want this one get it professionally inspected for a corrosion report.

It was welded by a samurai and it shows. Those pressed and welded parts are only as good as the weld.

Look at the lower A frames. If they look that bad, you may be better off to keep shopping for a better unit.

The welds in your picture are highly degraded for strength, but you can get replacements. Price the parts.

Another thing to pay attention to would be the metal brake line to the rear axle as it may be rusted up too.

Whats the model, year and mileage of this car ? Have you looked up it's approximate value on KBB.com ? Why not ?

have a trusted mechanic lift it up a take a GOD LOOK ....................

I would not give 8 grand of my hard earned cash for a aging Subaru showing that much sign of rust, no.  

For $8k you can do much much better.