Try buying a short sale

I think your best bet would be a short sale. It seems the banks are approving short sales more frequently and in shorter time. You may not get a screaming discount, but I think you can buy below market. In theory, (in a short sale situation) the seller does not care what the house sells for because they are underwater anyway. While the bank must approve the short sale, the bank does not always know the true market value of a house which may allow you to get a discounted short sale approved.

Most buyers don't like short sales because they take time and patience. But, if you are patient, I think you can nail one.