Many potential home buyers are not sure if they should wait to purchase a home or buy now.  Home prices are softening but they are expected to start going up in 2008. Interest rates are expected to increase. For each .50 point that the rate goes the home buyer loses about $25,000 of purchasing power. We have seen the rates increase from about 5.5% to 6.5%. This has translated into about $50,000 loss of purchasing power. Home prices have declined in some areas 1.2%. This translates into about $3,000.  As you can see the person who wanted for home prices to fall while rates are going up has lost about $47,000 in purchasing power. My advise is to buy now and not wait.