Is it a bad time to purchase a Canon Rebel XS?

I've been shopping around for an entry level SLR camera and I've decided on the Canon Rebel XS. I also thought about the Nikon D3000 but the deciding factor for me was the canon's ability to shoot video.

My question is this: Is it a bad time to purchase the Canon Rebel XS because it has been out since 2008? My thinking is that a new model is sure to be released soon and the Rebel's price will drop dramatically. That would suck to buy it for $500 and find it for $300 a month later…

Does anyone know if canon is due to release a new model?

I believe both of these cameras have already been discontinued. That's why they're $500. The new Nikon D3100 is higher priced.
Both the Nikon & Canon are good entry level cameras.

XS is a poor excuse for an SLR camera… It is the bottom of Canons barrel and is being discontinued as soon as old stock is sold. It uses the ancient Digic III processor AND IT Can't SHOOT HD VIDEO (if a salesman told you it can, they are full of it)!

The updated Canon Rebel T3 (an upgraded version of the popular and ground breaking Rebel XSi) is a much more solid camera for your money, the XS feels like its made by fisher-price or Mattel in comparison.

For a bit more money, you could get a T1i, T2i, or T3i… All of which are even better cameras than the T3.

If you are not sure why you need a DSLR, you likely don't need one. You may be much happier with something like the Canon Powershot SX30 IS or the Fujifilm HS10 (in fact, these will provide much better quality than the XS… Or even the T1i). They are advanced point-and shoots that take spectacular photos and video without the size, price or hassle of a DSLR or ILC system.

The Xs can't shoot video. The difference between the Xs and the D3000 is that the Xs has live view (which, you really shouldn't care about), and it has an actual AF motor, whereas the D3000 has neither of those.

don't worry about price drops… That almost never happens, although it did happen to the D3100.

DSLR cameras hold their value pretty well for a good number of years. To find a decent Nikon D40, used, you have to pay $400 or so

For cameras old is not gold but trash