Well, it's up past 200k, so it's no spring chicken. But you can't judge these based on miles alone. It could have been well-maintained and runs just fine, or it could've been neglected. You need to go in and check it out. Rust blight is also a concern with Cherokees out in snow and salt country. As I just read in another thread, you can replace parts. The body's another matter.
Asking price seems high for the mileage. 2k flat if it's in good condition, maybe? More experienced XJ buyers will have a better idea.