I recently answered a question very similar to yours so if you don't mind, I am going to cut & paste part of my previous answer:
As many agents have said here, yes now is a very good time to make a condo purchase! Prices have been increasing in the Pearl and will only continue to rise. As you now know, inventory is very low right now so my best advice would be to be patient to make sure you find the condo of your dreams! Don't be scared into thinking that everything will be gone and you must make a rush decision. More condos will continue to come onto the market especially as we head into spring. I specialize with condos in the Pearl, downtown and Southwaterfront and would be happy to assist you in your search for the perfect place! This past week I have had tremendous activity in my condo listings so the buyers are now out and looking... there will be competition for buyers with these low inventory levels. In being patient, you will find opportunities that come along, they always do! While prices will continue going up (nationally expected to be 3-5% this year and slightly higher for Portland) keep in mind that the banking association expects rates to be up to 4.5% by year end. This could be the difference in buying a 1 bedroom unit in the future compared to a 2 bedroom unit right now... depending on your price point and if this is of importance to you.
I would highly recommend getting out to look at units right now! Continue to look at condos and lofts as they come on the market. Look at many! When the right one comes along, you will know it! That will be the time you need to step up and make an offer.
When buying a condo I suggest working with a specialist in the condo arena. A condo specialist is in that market EVERYDAY. This person will help you understand the things you need to know when buying a condo ...HOA reserves, restrictions, rental caps, pet policies, values, values of parking spaces and storage spaces, which buildings have litigation issues and what that means to a buyer etc. Knowing what is or is not a good value will be important information for you to have when you go to make your decision. As for buying a foreclosed property, there are not many out there and there will be less as we move forward so I wouldn't count on it.
Now to compare the Pearl to South Waterfront. I would suggest taking a look at many properties in both areas. South Waterfront is certainly less expensive but that is only relevant if that is an area that you do like. South Waterfront is much less busy and the noise levels are much less but you can also hop on the streetcar and be into the Pearl in no time at all. Both locations are great and it really comes down to your personal preferences. The most important thing for you to do right now is to get out and start looking at numerous properties, after a while, the answer will become very clear to you as to where you decide you want to live. Please call me if I can assist you. Until then please visit my websites for additional information.
Best of Luck!