It looks to me like part of the exasperation is coming from having very tight parameters. It looks like you want the cheapest decent house,with garage, within a limited geographical scope.I knowhte area well and I think I understand why you chose those limited areas within that general area, but it makes it tough(er). I understand that this is not only happening to you, but there is a pattern to it too. Waiting is likely to work out but if you want what everybody else wants in the fall, it could still be tough going. The fence sitters that do come off tend to want the same things.

One other thing, it is is a misconception to think you are only competing with people limited to 3X’s income. Maybe people have cash or bring a larger down, use the bank of mom and dad. FHA can use a qualified family member or family-member-like cosigner. There are also people who might use a low down but only part of what they could potentially qualify for on income too.