I think that's 20 of 28 answers from non-San Franciscans. What does the Chicago market have to do with the price of tea in China? If there are foreclosures all over Phoenix, can you tell me where to find them in San Francisco?
And rates aren't low??? If you wait for 5.5% to come back, you might end up with 8%. Rates are phenomonal right now IF you have the income, credit score, and downpayment to get low 6's.
My suggestion is to use this "slow" time to educate yourself on the inventory. This is work. You need to be out every Sunday at Open houses, and you need to be scouring the MLS. You'll be an expert in no time flat, and when a "deal" presents itself you'll KNOW, and you'll be ready. Luck favors the prepared.
In the meantime.... let's look at renting.... WHAT is it good for??? If your rent is $2,000 cheaper than your monthly mortgage/taxes/HOA dues, less tax savings.... you should start "paying yourself" that $2,000 and get used to making house payments. Pay it to your savings account if you're going to buy soon, or pay it to your INVESMENT account if you're not going to buy soon (or ever based on much of the advice I just read). That is the ONLY benefit to renting.... saving to invest... either in real estate or elsewhere.
So then the question is... WHERE are you going to invest? In the stock market? Is that a safer investment than real estate? Or wiser? Or easier? Won't the stock market continue to "soften" more????
Besides, if you put $100,000 into the stock market and get a 10% return you make only $10,000. But you can buy a $1 million home with the same $100,000 and a 10% gain is $100,000. Which will get 10% appreciation first????
Uhh.... that depends..... every neighborhood is different let alone every town, every state and every section of the country. In San Francisco every block can be different. So please don't take San Francisco advice even from a person who works out of town even 20 minutes away, let alone someone in another part of the country. That's just as bad as using someone's opinion on the overall stock market when you're considering buying shares in one particular company, in one small niche. Which will go up 10%? And when? Do you're own research.... and find experts who really know the exact area you are researching.... and then do the best job of answering that SPECIFIC question for yourself.
And while you're out at the Open Houses.... stick around for a while... count how many Buyers are coming through (to the new listings), engage a few in conversation... what you'll probably find is that there are a LOT of Buyers who are "waiting for the market to soften". So the "demand" is there.... waiting. And they are building up, and getting stronger. My plate of Buyer clients is getting bigger and bigger as they all wait. That leads me to believe we are at the bottom (not much of one since some neighborhoods are up over last year, some flat, and some areas and market segments down), and once they stop waiting and start buying.... prices will go back up.
You said "loft" so I'm going to assume you are a SOMA buyer (hey Dallas or Chicago folks - any idea what part of town that is?) and if so, I believe you do still have some time, but not in that time I doubt it will go down much further... and chances are neither will interest rates.
By the way.... the Chicago, Dallas or even Santa Rosa, CA Realtors should have excellent advice for you if you ask the right question.... ask them where, in THEIR area, you can find investment properties that will cash flow. If you really aren't comfortable with the San Francisco market, investing outside of the city where a renter can pay all or most of your bills. Their doom and gloom is your opportunity. Be a contrarian... buy when everyone else thinks it's bad, and sell when everyone else thinks it will never stop going up.