Is now the time to buy a house?

Housing prices are falling. Is the buying opportunity of a lifetime almost here?

Housing prices are down to nearly 5.5%, and this week the federal government may be locking the rate down to 4.5%. The buying opportunity of a lifetime is reportedly on its way, although no one knows exactly when it will begin.

The time is certainly fast approaching, and unfortunately we will only be able to know the absolute bottom of housing prices when looking back. According to a New York Times article, the moment will probably arrive when everyone is feeling the most pessimistic.

There's still a downside to the housing market. A study called "The Changing Prospects for Building Home Equity" forecasts that many buyers will see a decline by 2012. There's even a potential six figure drop on homes in San Francisco, New York, Los Angeles and Seattle.

For those looking to buy, here are a few tips:

Don't spend more than 28% of your pre-tax income on mortgage payments, insurance and taxes. With the current unemployment rates, use caution if you think you may be at risk. A.C. Panella, who teaches at a University in CA, waited until she reached tenure before purchasing a home with her partner, Amy Goldman, a lawyer for a nonprofit organization.

"We could afford the mortgage payment on one salary, were something to come up." says Panella. Start now to get on track to improve your credit score. It takes time to qualify for the best mortgage rates.