Bought a townhouse and moved in 6 weeks ago.. already paid off half of it thorugh a shitload of saving while I was living in the parents place (I'm 24, but got along well with my p's so it wasnt too bad! ). Remember if you're planning to rent the place out that you buy, you need to live in it beginning in the first 12 months, and for a period of 6 months or more to qualify for the FHOG.
There are some valid points above about instability in the market, but I think that as interest rates are dropping, more people will be looking to buy - more buyers means higher demand, which bumps up prices. On the other hand, market instability and job losses could be cutting that demand for houses back down again. It's 50/50 imo so I doubt the market is going to be too heavily affected.
We've seen a decrease in prices since the boom a number of years ago, but I reckon it's come close to bottoming out soon, if not already.
I think this time is a good time to buy! Supposedly the developers of new houses will be tempted to bump prices by up to $21,000 to 'steal' the FHOG for new establishments so it'll be interesting to watch what happens with that!