Everybody is very cautious now when it comes to buying a home. Especially the first home. You should be cautious and have your agent give you lots of statistics. But, beware of paralysis by analysis.
Your real estate broker can help you interpret the data. I love for the buyers I represent to have a firm grasp on the market.
Keep in mind that interest rates now are similar to the 1950's - low. I haven't been helping buyers quite that long - lol. But, during the past 20 years this is the best I have seen.
If it is your first home, take advantage of the $8,000 tax credit (you actually do get it back - ask your accountant just exactly how it will benefit you).
Think about it this way. If you buy while the interest rates are below 5% instead of waiting until they reach 7.5% (which we thought was great in the 90's), prices would have to go down by another twenty percent to make up for the difference in your monthly payment. Many analysist believe the real estate market is now beginning to stabalize - which would mean we are no longer declining and that great deal is now!
Email me if you have questions. terrilatta@bellsouth.net