Need and should are two different things.
You need good credit, a bit of cash, and a decent income to buy a house.
First you shouldn't even consider buying a house if you are in debt (that means anything - car, student loans, credit cards, etc.). Once you are out of debt, you should strive to put 20% down on a 15 Year mortgage where the payment is no more than 25% of your take home pay each month. This will keep you from being one of the many foreclosures that we are reading about.
Before other agents hop in and tell me that I am wrong, and that Ribby can put down less and should get a 30 year because it would be cheaper - that is your opinion and I have given mine. The advice I give is from a nationally recognized financial advisor (www.daveramsey.com) and speaks more to the financial health of the buyer than simply just buying a house. I think we can all agree that the current market condition is a result of people who shouldn't have been buying houses - buying them. Even if we did benefit from the sales.