Realtors may be knowledgeable on current and past prices for their area, but they are NOT experts on future price trends. Realtors are not economists and very few have any business or economic training to speak of. They are salespeople. The reality is that they only get a commission if you buy, so they have an incentive to be less then accurate as to their assessments. The few compotent Realtors with integrity would admit that prices are going down in many parts of the country and most buyers could save money by simply waiting for the bubble to further deflate.
If you can afford the house with a large down payment and conventional financing and don't care about prices dropping further, consider the purchase. But DON"T purchase with the expectation of future price gains. This was a huge bubble that needs to finish deflating. If history is any guide, prices will not rebound quickly when the bottom is finally reached.
Best of Luck,