It is a excellent time to buy.
As I tell people, there won’t be an email sent out saying, “the bottom is in, buy this week”.
Builders are having to move some inventory, but that is a limited amount of homes. We are seeing a lot of activity, people with good credit and asset positions are buying homes right because they see the value.
Will prices go lower? No one really knows, the overall state of the economy will be a big factor.
It will be an excellent time to buy in, say 2012 to 2015. It is a very poor time to buy right now, unless you are simply moving from one home to another. I cannot imagine entering the market at this time.
And it is more prudent to wait for the bottom and then buy shortly after it starts going up than to buy just as the prices START to fall off a cliff - which is where I believe we are now. The former position holds very little risk, the latter, huge risk.
It's a good time to buy a house IF:
you can pay for it without beggaring every other aspect of your life (the old 3x income rule is always best) AND;
you are comfortable with the market price of your house going up, or staying the same, or going down, over the next few years.
Come to think of it, it's always OK to buy a house if the above qualifiers apply.