Not a Real Estate Agent here but have been through the process several times.

First of all, I cannot imagine anyone wanting to be a home owner at this particular time because of economical and other reasons (Fiscal cliff, Tax increases or loss of home owner deduction), etc. Much better to hold tight and rent untill things get better.

If really firm on wanting to own then you might consider buying a house that is headed for foreclosure. Motivated sellers there.

Another option would be to buy a foreclosed house for 10-15 thousand and spend the rest of your savings putting it back in livable condition. Most have been vandalized (copper plumbing, wiring, air conditioner unit, etc.).

Things to think about.