Renting your current property so that you can enjoy this buyer's market is an excellent idea. I would, however, suggest that you get in touch with a good loan officer to take a look at how best to qualify. As you probably know, loan approval is much more difficult now with the meltdown of the mortgage industry. You need to consider your overall debt to income ration (needs to be below 43% for most lenders) and whether or not you will need to count the rent on your home as income to qualify. If you do need this income you will have to rent your home first and show that cash flow before you purchase. Some lenders will accept a signed lease agreement as proof but it is definitely best to show a deposit or two (and make copies of your tenant's rent checks).
I know that it will be quite the task to move out and find temporary living (great time to garage sale/goodwill that unused stuff!). But It will DEFINITELY be worth taking advantage of the huge opportunity in acquiring real estate right now.
Please let me know if you would like me to refer you to an excellent & reputable agent or loan officer (I used to live in the LA area).
Best of luck!!