As of this morning, an analysis of the futures market put the probability of the Fed raising interest rates by the end of the year at 35 percent.

But this afternoon, Federal Reserve Chair Janet Yellen indicated that the Federal Open Market Committee is likely to increase the federal funds rate later this year, absent any new economic surprises.

2 thoughts on “Futures Market Says No, But Yellen Says Yes Re: Rate Hike”
  1. Its likely coming in 2016. Who knows if before then.

    SF affordability is below its historic average, so prices have likely peaked here. Rate height or not. Not that the world is crashing. A mailer from a WofTP realtor the other day said expect a 5% drop. Even with a rate height I doubt a pullback will go much higher than that. 10% at the most.

    Other markets remain significantly below their historic affordability average. In Pittsburg an investor or home buyer can purchase a renovated duplex for under 100K. Not far from where major film studios are expanding.

    A return to more normal rates ultimately is a good thing, despite short term problems it may cause.

  2. Rates on commercial real estate loans from major lenders remain low despite the expectation that the fed will raise rates later this year. Many investors are refinancing now to lock in low rates. Others don’t believe that the increases will significantly affect rates in 2016.

Leave a Reply

Your email address will not be published. Required fields are marked *