What issues are preventing buyers from buying their home in early 2012?

School. I'm gonna need to wait untill at least mid 2012(which probably means early 2013 )

really the deciding factor is when I decide I am where I want to be for the next 10 years.

Personally...

1.) Tighter credit restrictions; although I am hopeful that my actions to improve my scores have worked.

2.) People think homes aren't selling and there aren't many nice, well-maintained properties on the market.

I hope the "right" property comes on the market and I can get financing in 2012.

Wes, some buyers lack the needed down payment. Some do not have good enough credit to get a mortgage. Lending standards are tighter than they were during the bubble but still are not really that tight. Once you get beyond the ability to get financing other issues appear.

The same way that people who bought in 2004 thought they had not buy now before they were prcied out of the market people today see falling prices and wonder why they should buy now when prices will fall more. After seeing prices fall for 5 years most people expect further price declines.

The federal reserve just announced (ouch for savers) they plan on keeping rates this low for another 3 years. The hurry to buy while rates are low does not exist.

Some people look at the job market and wonder if they will have a job in 6 months. Some have had pay cuts and are afraid another pay cut might happen. Very few people who do not feel completely secure in their job and finances are willing to make a huge purchase like a house just in case something bad happens.

The idea of a house helping them financially is pretty well destroyed when looking at all of the short sales and foreclosures around. A lot of potential buyers know someone who lost a house or who had to short sale. They recognize the risk to their credit and finances.

Here is an example to consider. A friend of mine bought a trailer in a park. That was obviously not a high end real estate purchase. He would like to get out from under the trailer and go back to renting. Owning the trailer even with a paying roommate has cost him more than renting ever did. The complete numbers do not always pencil out when looking to buy a house. The utilities alone (especially heat) can ruin the buying decision.

For me personally when I look at a house that would have sold for $100k in 2000 and now it is going for $180k or more the price is still to high. We had around 35% wage growth and inflation. House prices are still to high compared to incomes.

What I posted above is mostly based on various things I have seen in articles and news segments. It appears there has been in a shift in how people look at real estate compared to a decade ago. As perception colors reality many who could buy may want to keep renting for financial safety.