Stay away from adjustable rate mortgages.
Investing is about leverage. Leverage is about stability. If the rate on the loan adjusts annually, you can be pretty sure the rate will adjust up. Take a look at how just two percentage points can change your payment:
Loan $165,000 Rate: 3.5% Term: 30 years PAYMENT: $740.92
Loan $165,000 Rate: 4.0% Term: 30 years PAYMENT: $787.74
Loan $165,000 Rate: 5.5% Term: 30 years PAYMENT: $936.85
You would be better off locking in a rate on a 15 or 30 year mortgage rather than having the worries that as interest rates increase your return decreases.
To see if a HELOC will be better, make sure you calculate how much interest your will pay on this loan (higher interest rate + fluctuating) over lets say 5 years compared with a traditional 15 or 30 year mortgage.