I have talked before about timing the market to achieve the best interest rate and what the challenges are in doing that.  Mostly, not even the most knowledgeable buyer can do that.  That said, here is what I would look for in terms of events that the market has stabilized and ready for an uptick in either housing prices or interest rates.

First of all, you must realize that all of this borrowing by the federal government is at sometime going to result in inflation and that in itself will increase mortgage interest rates.  I remember the period in the seventies when inflation was high and you could get 19+% on a CD.  This was also a time when interest on credit cards was tax deductible.  Then came the 80′s and a change in presidents.  Inflation was put on notice that it would no longer be tolerated and interest rates skyrocketed to a high of 21%.  I personally saw mortgage rates climb to 18%.  It was kind of like the inverse of what is happening now.  Rates are historically low, but jobs a scarce.  If I were going to play the market and try to maximize the interest rate on a home mortgage I would look at employment rates and claims for unemployment benefits.

Once we start recreating jobs mortgage interest rates will start to climb and the opportunity will be gone.  For how long?…nobody knows.  Track unemployment rates by state and see how employment rates are progressing in the State of Michigan.  Another thing that will affect housing prices is the direct connection between average incomes and the price of housing.  This will occur when the next census is taken and the resulting demographics for an area will show these financial statistics.