Tell anyone that you're in the real estate business and many will immediately engage you in discussions about the market. The discussion usually leads to their revelation of why they feel that this is the wrong time for them to buy and/or sell a home. Most of the time, the reason is either that they are so far underwater on their home that selling is impossible, or they have some other credit or economic issue. I understand and sympathize with people who are unable to buy or sell right now. The folks who are choosing to delay buying or selling because they fancy themselves as some sort of real estate tycoon trying to time the market just don't understand what they're doing.
Imagine that you want to buy a loaf of bread. You don't use a lot of bread, and the rest of the loaf you have is old, but it's not stale. You notice that bread is cheaper this week than last, and that it was cheaper last week than the week before. Do you hold out for another week in anticipation of another price drop? The loaf you have now is OK, but it definitely isn't fresh, and it does taste just a little funky.
Unless you're out of money, you would probably buy a loaf of bread this week, not because the price is perfect, but because you want a loaf of bread. It's true that buying that loaf of bread is an investment of sort, but it's obviously a consumable, and you're buying it to use it, not to put it on eBay to make a profit.
Just as that loaf of bread was bought to be used, so also is a home purchased by a consumer as a personal residence. You don't have to find the perfect time in the price curve, you don't have to sell with perfect timing (whatever that is) if you're buying another home in the same or similar market area. You're going to live in and continue to use your home until you're either dead or they wheel you and your drool cup into a nursing home.
Although the possible future appreciation of a home's value is an attractive feature, home ownership is, sort of like a new loaf of bread, something to appreciate and enjoy. For all the consumer-analysts out there, where on the spreadsheet do you enter the value of a comfortable and secure yard for the kids to play? Where do you enter the value of the freedom to have a big old dog greet you when you get home from work? Where do you enter the value of the satisfaction you get from injecting your own personality into your home's decor? Where do you enter the amount of time you will have if any, to enjoy the fruits of your investments in funds and stocks? I'll give you a hint, nowhere.
You can make economic investments, and everyone should do that. Balance deferred payoff with a lifestyle investment and an immediate payoff which you and your family deserve.