Is it the right time to buy?

It all depends. If you are planning on staying in your home for at least 5-7 years I would say definitely yes. However if you are planning to stay for less than 5 years most likely not.
That was simple wasn't it? Even with the first time homebuyer credit of $8000?
Many people who I speak with feel that the worst is behind us and they do not want to miss out particularly because they feel it will be more expensive to buy in the future. Although that may be true in many places, I feel that Real Estate will still be attractive from a living perspective given my that you see it as a place to either live for the next 5-7 years or if you are investing but plan on having it cash flow and hold it long enough that you now can take advantage of appreciation.
Personally, I don't see appreciation really being a factor for the next 5 years, even with inventory starting to thin out a bit.
However if you are a little better off and bought your home before 2000, you probably have enough equity to have more flexibility in what you want to do. In addition if you are seeking to move up you will most likely get a very favorable deal, however, you most likely will not receive what you think you house it worth.
Things which should be remembered when the eventual real estate resurgent occurs; An increasing number of people are moving to the city (more than ever before). The population continues to grow. Land is much less available in the urban areas and their is much more re-vitalization and much gentrification occurring these days. Baby boomers are downsizing and are willing to pay for the amenities which comes with living closer in. So the long range prospects of property value are solid, however until we get through downsizing some of the inventory and have more stability in our job market and economy in general, I really can't see a reason why you have to buy know just so you don't miss out on the tax credit.
Although it is a nice incentive, you still need at least $10500 into the deal as well as closing costs on a $300,000 home. What this means is that without closing cost assistance you are looking at roughly another $10,000 for a total most likely greater than $20,000.
All in all it is a good time to buy but by no means should you reliquish your dream even if you can't take advantage of the tax credit. For more insight, information or questions concerning qualifying for a residential mortgage, please contact me via email at dviertels@gmail.com