Now the rates seem to be going back up. The interest rates have begun to increase here in Michigan and the feds just skipped the first interest rate hike in almost two years. The housing market in this state has now gone flat. It's turned from a sellers market to a buyers market, so if you are in the market for a new or existing home, now would be a good time to buy in Michigan.
Having been a home owner for over 25 years now, I have been able to watch the market turn in 3 very distinct directions over that period. In the 80's, the interest rates were over 11% and no one thought much about it because that was down from the 13% rates a few years earlier. We sold our first home in the late 80's and bought another home for a 10% interest rate which also seemed like a great deal and when we built this home at 9% we thought it was great. It appears we've hit the bottom of the barrel on interest rates and I hope everyone has made their moves when they had the chance, as it's appears it's going to be uphill from here.
I like the options of a home equity loan, as it allowed us to free up some income when we needed it. However, you need to use caution when doing this as you can easily get into a situation where the market flattens or turns and you could end up being "upside down" in home, owing more than the market value. Caution first and always do a little research before you change the type of loan you have or consider a home equity loan.
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