If longish term and your stable job wise and it's not to your limit then buy it.

The thing you need to avoid is buying a place and needing to sell in the short term, as you stand a VERY good chance of being in neg equity.

People are dropping their prices, but do you homework, my mate just dropped 25k off his house (125k - 100k) but will go no lower.

If the seller is asking a price that was current 6 months back, then offer a much lower offer and stick to your guns. If the seller, like my mate, has dropped a huge amount to get it gone, then make an offer, but expect not to get huge amounts off.

Just make sure you have researched what is selling for what in the area so you can be confident of your offer.

The best time to buy IMO is when the banks start lending and lending at a decent rate, as first time buyers will be back in the game and the housing market will start to rise again as demand grows, but who knows when that will be - no one.