Wait till 6 months and if not down he has a crypt orchid or retained testicle. It will need to be surgically removed.
In rare cases it can take up to 7 months for a dogs testicles to drop, but if your dog is older than this - it is unlikely that they will ever appear in the scrotum. This would indicate that he is cryptorchid, if neither of his testicles have dropped, he is bilaterally cryptorchid.
Most male puppies have both testicles in the scrotum at around 6 weeks, though for some it can be around 4 months before this happens. If by 7 months his scrotum is empty, he needs to see a vet as he should be neutered.
Although a dog with cryporchidism will have reduced fertility, he would still be able to breed, and there is a high likelihood that the condition will be passed to his puppies, as it is hereditary.
Other reasons to have him neutered are for his own sake such as:
- Cancer - There is a 13 times higher risk of a retained testicle becoming cancerous later in the dog's life.
- Testicular Torsion - It is possible for a retained testicle to twist and cut off the blood supply leading to a life threatening emergency operation.
- Problems with Behaviour - Possibly because the retained testicle is higher, and therefore at a greater temperature, it is common for dogs with this condition to display greater testosterone fuelled behaviour such as being aggressive, mounting things (and people!), urinating on furniture etc.
So basically, if he was bought as a pet/member of the family there should be no problem once he has been neutered which should be discussed with your vet and carried out as soon as possible.
If you did buy him for breeding purposes you may want to talk to the breeder because it seems she/he may be breeding from a dog with this condition.