Liz, unlike much of the nation, Rochester has been rather sheltered from the "burst." Infact my team has experience its best year ever. I am not sure if I agree with the market getting worse for Rochester. Sure there have been changes and some price ranges sit longer than others, but the real estate market is alive and well in Rochester, NY.
As far as waiting or not....somethings you should know. There are many incentives, first time home buyer programs, home savers clubs etc.... in and around Rochester that provide first time home buyers with FREE money for closing costs and down payment assistance. Knowing your options could save you thousands, literally!
Only you can truly decide if the right time to buy is now, but I would recommend at least having a conversation with an agent or mortgage professional to understand just what your own personal options are.