In 2007 I was telling highly leveraged clients to sell - and some thought I was mad. In 2011 I'm telling clients to buy - and from some of the comments here, apparently I'm still mad :) I'm not talking of flipping - though I do think there are bargains to be had for all-cash buyers of distressed properties. In general, I'm talking buy and hold. We could be at the bottom, we might not be - people only know that with a decade's hindsight. What I do know is that:
When it's cheaper to buy than rent... buy. When interest rates are almost negligible... borrow.
Warren Buffett says market prices "will move higher, perhaps substantially so, well before either sentiment or the economy turns up," and warned: "if you wait for the robins, Spring will be over." Check out this link dated March 16th 2011 for more Buffett nuggets of gold on whether it's time to buy real estate:
A good, and possibly too boring for "speculators," plan is to: buy low (relative to the past ten years), get a fixed mortgage with affordable payments and be in a position to hold should that prove necessary.
I bought my first home in NYC in '94 at the end of the last crash... an 800 sqft 1 bedroom co-op in a gorgeous historic building with 24hr concierge for $50k. YES $50k. Today it's worth over $600k even in this recession. Sadly when prices drop, they never drop back to past historic lows. At least I haven't seen it. And there are certain places that just like NYC, in our case Venice, Santa Monica, Beverly Hills, Hollywood Hills etc... these place will ALWAYS be comparatively sheltered markets. They can't be duplicated.
Good luck whatever you decide.