John L. Scott
I don't want to repeat what has already been said. Installed correctly and well maintained, vinyl siding is fine.
The problem is in the minds of buyer's. Right or wrong, many buyers I have worked with see vinyl siding and wonder what it is covering. The snap assumption on some people's mind is that vinyl siding is like painding over a problem. They think there must be a reason it was put on in the first place. Just be aware of this concern and make your offer accordingly to account for a future discouns a buyer may make when you go to resell the home.
I'm a Realtor, but my background is as a Mechanical engineer during which time I worked as a design engineer in the window business. The fact of the matter is vinyl siding installed correctly is fine. Also, you can get around many of the future buyers concerns by taking good photos prior to the install. However, I totally agree with Kenzie...all the homes I've built and remodeled I re-sided with Hardiplank...it is a great product. In many neighborhoods - especially Kirkland - vinyl will de-value your property...similar to installing a Pergo instead of a real or even engineered hardwood floor. I personally would only consider vinyl on longterm holds in less valuable areas where I wanted to avoid maintenance. One last thing...if you go the vinyl route make sure it is installed correctly...the water issues are typically created by poor flashing practices and insuffienct caulk (aka they let too much water behind the siding).
Here is a link about vinyl siding... http://architecture.about.com/cs/repairremodel/a/vinyl.htm. It is a type of siding that is inexpensive for people to use but not the best siding to use. I work for CamWest, a high end builder and the only product they use on their homes is semplank, a hardipanel material. This is possibly the highest end product currently on the market.
Give me a call or email if you need any assitance in your home purchase! I would love to help you!