Quite simply, do NOT wait for the bottom of the market.  Nobody is going to ring a bell to signal the point at which we reach that bottom.  We will not know the precise bottom until months after it has already occurred.  Take solace in the fact that the conditions are perfect with low interest rates, hungry, motivated sellers, and plenty of choices, so jump in now and go find the best home for your family.  Please understand that these historically low interest rates will NOT last.  Just this week, the economic reports are pointing towards inflation, which is not good for interest rates.  The Federal Reserve released their "minutes" from their last meeting; policymakers said that when prospects for economic growth improved, "A reversal of a portion of the recent easing actions, possibly even a rapid reversal, might be appropriate."  These low interest rates that the entire nation has grown so accustomed to will increase to levels not seen in a while.  In 2000, they were at 8%, and in 1990 they were at 10%.  A change in interest rates to more historical norms will seriously erode a buyer's purchasing power and will result in much higher payments.  Any advantage gained by waiting for prices to reach a "bottom" will be lost in much higher long term monthly payments. Take tremendous comfort in the fact that Southern California real estate has always been a historically wonderful long term investment.