TBH, i'd say the market for hosue buying is not too bad at the moment. Certainly, right now, it is a buyer's market, in that sellers may be prepared to accept lower offers on their property than would have been the case 6 months ago.
The gamble is whther the market will continue to dip for the next few months/years, or whether the market is finding a new level and will level off soon and remain constant for some time.
Also, if you have decent credit rating, getting a half decent mortgage with a different lender right now should be no problem. Interst rates have dropped a little recently, and i doubt they will go up significantly for the next 6 months or so, so getting a tracker mortgage could be a god option. rates may even come down slightly over the next 12 months.
It's not all doom & gloom IMO mate.
Me and my girlfriend are moving into our first house in 10 weeks, we're on a tracker as this was recommended by the mortgage advisor (a friend of the family). Hopefully all will be ok.