Do not get this TJ. I had a 2003 SE with the 2.4L Powertech engine that the one you are looking at has.
1. When it dies it is dead. Mine threw a rod clean through the block.
2. When it is dead expect to pay many thousands for another engine.
3. The 2.4L has motor mount brackets that are incompatible with any other block.
4. A REMANUFACTURED 2.4L is well over $5,000 installed.
5. A NEW 2.4L cannot be had for the Wrangler.
6. A remanufactured 2.4L might take many months to get as the big places (like Jasper and such) cannot locate the blocks very easily.
7. Those motor mount brackets are welded on and must be cut off if you want to use any other motor in the thing.
8. Upgrading to a 4.0L is a no go unless you can get the computer, radiator, AC lines main wiring harness and just about everything else from a 4.0L that matches the specific version of the 4.0L you intend to stick in your engine bay.
I know all this because I have been coping with it for over a year now. I am making up nothing, here. The older 2.5L (slightly lower output than the completely unrelated 2.4L, but a cute, mini version of the 4.0L) is much easier to locate and less expensive to replace if your old TJ used one in the first place. Yours did not. The 2003-2006 4 bangers all used the newer 2.4L block. It is in no way related to the 2.5L and none of the 2.5L gear can be used with it. The 2.4L was a good engine, but now that it is apparent that getting another one is so hard, I would stick with a 4.0L, which is easier by far to maintain and service, is far more easy to find parts for, and generally performs FAR better. I know this from personal experience, too. I own a 2003 SE and a 2003 Sport.
This seller is insane, too. ANY SE TJ in really great shape is worth at best about $8,500.
RUN FROM THIS!
There are a lot of better jeeps to be had for less money and that will last for far longer. I am *very* pleased with my 4.0L Sport that replaced my dead SE. Very pleased, indeed.
Keep in mind that the SE wallows on long hills, where you can hit the bottom at 75, and at the top, with your foot to the floor, you will be struggling to maintain 45. This is a fact. SEs are losers on long hills. On flat pavement in a strong headwind you will experience the same thing. Regearing is not worth the expense at all considering the weaker versions of the axles you would be upgrading.
In all honesty, I loved my zippy SE most of the time, when it *was* actually zippy. (Flat pavement was always fun...)
There were many times it just sucked to have to cope with it. And when it died it went out in style. The dealership quoted me $6700 for the new block, another place that does good work on jeeps but that is an independent shop quoted me over $5,000. Swapping in a jeep 4.0L is as complex and costly as sticking in a Chevy small block V-8.
Trust me and my decade of SE ownership. As these 2.4L blocks age it is best to start distancing yourself from them if you are shopping for a TJ. The 4.0L is a bombproof motor. It is very easy to work on. Parts are easy to get and generally cost less than parts for the 2.4L. And the performance is much better. The mpg is about the same, too, since in the SE you drive with the foot to the floor most of the time on the Interstate, negating any small advantage in mileage. The 4.0L can turn at a much lower rpm on the Interstate, so it gets its intended mpg. The SE cannot keep up on the Interstate unless pushed hard, and that is not where they get the mpg numbers from. It is from driving at about 55 on flat pavement. Not Real World at all. The 4.0L gets mpg on the Interstate that are pretty close to the posted numbers.
Good luck, but please look for a Sport. A well cared for one of the same age should run you about $11,000. I got mine for $8,000 and it was pretty beat, but it runs great. My SE, were it running and for sale, would probably get me about $7500 because it is in excellent physical shape with everything working and zero body damage. That is a fair price. Not the one you are being quoted. And if you will note, the cost to replace that 2.4L engine (should you ever need to) will probably cost you about that much in years to come.
Wade