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Is now the time to buy a home?

(MoneyWatch) Buying a home appears to be one of this summer's biggest trends.

Bidding wars, jacked-up prices and swamped open houses: There are horror stories around the country of buyers in search of real estate.

Buying a house in the midst of a feeding frenzy may not be the wisest strategy. But if you wait only a few months,  conditions may change and you can get a better deal.

Interest rates will remain low

Interest rates have climbed over the past six weeks. Since early May, they have edged up to almost 4 percent for a 30-year, fixed-rate mortgage. Even so,  Ben Bernanke announced this week that the Fed will continue to buy up $85 million in bonds each month until at least mid-2014, keeping interest rates low.

As Amy Crews Cutts, Equifax's chief economist and former economist for Freddie Mac, put it in an Equifax housing webinar Wednesday, "Today's rate is probably the best you're going to get. They could go lower, but that's not likely.

A change of a 10th of a percentage point in interest rates translates to real dollars in what you pay in the life of a mortgage. But a change of just a few points in either direction, even if it does occur, will not amount to much. So why not wait a bit and see if other aspects of the home-buying climate improve.

Home prices will level out

Home prices have increased more than 10 percent over the past year, according to the Case-Schiller home price index, a leading real estate indicator.

"That's just unbelievable," says Steve Cook, co-publisher and managing editor of Real Estate Economy Watch, a real estate information website. "That can't be sustained. As we look ahead, we're going to see prices moderating."

There are no signs that we're in a bubble again that is likely to burst and send prices tumbling. "Although the word 'bubble' is fun to say," says Cutts, "I can't imagine we're anywhere near bubble territory."

More inventory is coming to market

Home price increases were driven largely by limited supply, not higher demand, so as more homes become available for purchase, those rising costs should slow.

And that's exactly what's happening, Cook says. Inventory is starting to loosen up and builders are scrambling to get crews together to build homes as quickly as possible.

Active listings grew 6.4 percent between March and April and a further 4.2 percent between April and May, according to real estate brokerage firm RedFin, which also conducts market analysis.

Timing matters

Too many markets across the country are hot right now. Thanks to limited inventory, even less-than-desirable homes are being snapped up in days.

To determine when you should pull the trigger, keep tabs on what's happening in your local market.

Look for trends that favor the buyer: more homes that turn up in online searches, a rise in homes on the market for a longer stretch and a leveling-off of prices.

By waiting for market conditions -- and temperatures -- to cool off, you could win big on the price you pay for your home.

"If all things are equal, you want to buy your house in winter," Cutts says. She estimates that buyers who purchase homes in the winter save between 1 and 3 percent more than buyers who purchase homes during the summer, when demand is higher.

"If you're starting to see inventories rise, I would say wait awhile," Cook says. "Sellers are much more eager to negotiate in the fall or winter or spring."

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