The perfect storm is brewing: rates are falling, prices are coming down, there is little to no competition among buyers and we are fast approaching the Holiday or Winter market.  This IS the buying season.  Many will tell you to wait.  Others will accuse me of bias because I am in the real estate industry.  Nobody knew that 1995 was the bottom of the last downturn either until years later.  In hindsight, every living adult should have bought that year, but most everybody was fearful that the market would continue to decline.  Sound familiar?  Prices have already come off of their highs and for the rest of the year and the start of 2008 promises to be a very similar situation.  Throw into the equation that rates will be extremely favorable and it is an excellent scenario.  It is important to note that Bernanke and the Federal Reserve will only drop rates for as long as they have to.  As soon as the market shows any signs of life, they are going to hedge inflation and increase rates immediately.  Even if prices drop slightly, you can still expect payments to increase as rates increase.  Having the luxury to isolate an ideal home in a soft market with low rates is not a luxury to pass up.  It is extremely important to keep in mind that Southern California, and more specifically, Orange County, is historically a solid long term investment and an excellent place to live with a real lack of buildable land.  Lastly, in arriving at a fair offering price, the average current closed sales to final list price ratio for Orange County is 97% and NOT 80% or even 90%.  Lowball offers rarely result in a sale.  Seeking a motivated seller and offering a fair price will.