Buying a new house is exciting, but it's also a major financial undertaking. In preparing to purchase a home, several factors will help you determine if you're buying at the best time for you and your family.

Here are some guidelines to assist you:

When is the best time for a buyer to look into a home purchase?

Ideally, you want to buy a home in a buyer's market. A buyer's market has more sellers than buyers. Because the competition for buyers is tight during this time, home prices are lower and more flexible, and home values are generally primed for a turnaround. Interest rates also will be lower, which should ease your access to financing.

Turn to the real estate section of your Sunday newspaper. Monitor the market and tract home prices. Expect to spend 90 days watching the real estate market through advertisements.  Question and investigate homes that are advertised month after month.  Hard-to-sell properties could either be a warning sign or simply overpriced for the value.

Since home buyers generally have more flexibility than sellers, you have the advantage of waiting for a buyer's market before you pounce on your dream home. Look for the following elements to determine if the real estate climate is right for buyers:

• Are houses selling at a faster or slower rate than a year ago? Six months ago?
• How many offers are being made on homes in the area? Multiple offers?
• Is there a sizeable gap between sale prices and list prices?

When a real estate agent provides you with descriptions of homes currently on the market from the Multiple Listing Service (MLS), ask for a list of homes that were on the market within the last six months or year in the same neighborhood.  Compare asking prices to actual sales prices for the same type homes.

In addition to monitoring housing prices, learn to identify hot, up-and-coming neighborhoods by tracking selling prices from week to week.  If one neighborhood experiences price booms while other house prices are sluggish, its clear which community to invest in.  If  you're passionate about an upscale area ­ and on a budget  ­ prepare to buy a fixer-upper and invest some money in renovation.  Conversely, beware of buying a beautiful home in a marginal area.  You may not get your money back when you sell.

How often does the market change? Will I have to wait long for an advantageous market?

Real estate markets are highly cyclical. While home prices generally rise moderately over time, in the short term, they can increase or decrease seasonally in response to market conditions. If your local market is booming, you may think of postponing your purchase until things cool off a bit. While you'll have to wait a little longer than you might want to, you're much more likely to find a real bargain. History suggests that all high markets eventually go down.

How dependent am I on my financial status?

A home is a major investment. You'll have to commit money to a down payment, a mortgage, and moving expenses. Keep close watch on the fluctuating mortgage interest rates.  

Low interest rates are the most inspiring reason to buy property.  Watch the rate of Untied States Treasury Bills.  According to Sonny Block, well-known talk show hose and real estate author. T-bills are a sure way of predicting the rise and fall of mortgage rates. Also watch the national Discount Rate, the rate at which banks can borrow money from the government.  When the Discount Rate drops, banks pay less for borrowing the money and in turn reduce mortgage rates to the borrower.

Before you take on this responsibility, assess your financial position.

• Can you afford the down payment and monthly expense?
• Is your income secure?
• Do you have job stability, or is a change likely in the near future?
• Can you afford all of the related costs: closing expenses, moving, utility installation and furniture?

If you aren't comfortable with your ability to carry the financial obligations, it might be wise to wait until you feel more secure before you buy.

Predicting when a market is ripe for home buying is not an exact science ­ even for real estate experts.  However, by following these simple tips ­ and staying on top of real estate trends, sales patterns and interest fluctuations, you are sure to get the best house for your buck.

Home ownership offers so many opportunities including money "rebates" through the interest tax deduction, profit from property appreciation, pride in ownership and belonging to a community. In deciding when to buy a home, consider all aspects of your situation, whether they pertain to the current market or your personal financial means.