I wouldn't put much stock in the chicken-little-sky-is-falling philosophy. It sells books maybe, and people who constantly predict disaster stumble uncontrollably onto the truth once in a while (like a broken clock) but it's no philosophy to guide your decisions.
With that said, being a great investment shouldn't be your #1 priority when buying a home in which you are going to live in. There are many other other economic, lifestyle and emotional reasons for buying a home. Only you can decide if home ownership is right (or not right) for you. http://witchcityhomes.blogspot.com/2011/07/why-do-people-act
What I can tell you is that with the current prices of real estate and the low mortgage rates, home affordability is the best it has been in over 20 years.
While many indicators show 2012 the year of the housing market stabilizing there are never any guarantees.
While considering purchasing a home their are many reasons outside of financial for purchasing a home. A home purchase should never be strictly financial. When considering a purchase you should be buying for the long haul where market fluctuations are not necessarily troublesome. While this market correction has been particularly heavy, so was the price run up particularly aggressive. market corrections are and will continue to be part of the buying cycle. While the late 80 early 90 correction was not quite as devastating people who bout in that market and have held on to their houses still have seen a tremendous appreciation in their house price.
Whatever your decision.... buy for the long haul and do not worry about the short term price fluctuations.
Investments are always a good time to buy, but you must know that the income will support the debt, expenses, reserve and provide a cash flow.
Homes rise and fall based on many factors, also salem has some very nice areas and others that are not as nice. Best to have an agent in the market that can guide you properly.