I am in the exact same situation as 1stimebuy (except for the kids, I have a one yr old), we may have put offers on the same house too. I too feel that I may have waited a bit too long and feels hopeless in these zip codes. There are no good deals right now and I am will not over-bid out of fear that there is another leg to fall in this housing crash and I will be underwater by the end of the year. Trying to be patient and hoping that the shadow inventory will eventually show up and force prices down to more reasonable levels….not too sure about these zip codes though…looks like all the tech employees (QCOM, Broadcom) target these areas and they do have decent purchasing power..