I think just posting my experience will be easier to understand.
I live in St. Louis and have been looking for houses since late 2012. I started off looking casually not even sure I wanted a house. I do like old architecture, so I enjoyed looking as a hobby in itself. I had an offer in on a house roughly 6-8 months ago, but the inspection caused it to fall through. Basically it was a 2 family building, and I was only able to view one unit before putting an offer in. The second unit was an absolute disaster.
I went back to casually looking and knowing I wanted to buy, BUT ONLY IF THE RIGHT DEAL CAME ALONG. I think that's the key. There isn't really an opportunity for market timing; But there is an opportunity to get something priced below market. Finally, about a month ago, I put an offer in on a beautiful house ... old woodwork, fireplace, cool attic, etc. I ended up buying it for $37,200, and it needs about $20K in work. That would be a total cost of ~$57,200, at which point it will be worth at least $70,000.
Oh, it's also a foreclosure. Don't be afraid to check out homepath.com for severely undervalued properties. If you're going to owner occupy, you have a huge advantage, but only for the first 20 days.
Edit - it would be worth at least in the 100s if I did all the work to truly restore it, but I used the work needed to move in with comfort items as a starting point.