The Fed finally did what everyone expected last week to raise rates by 0.25%. The Fed Funds rate hadn’t been touched for nearly eight years but a rate increase was in fact not only in the cards but probably the worst kept secret on Wall Street. The ratemove had been so widely anticipated that mortgage rates for real estate investors remained relatively calm, this according to Freddie Mac’s weekly mortgage rate survey. For 1-4 unit residential properties, the 30 year fixed rate averaged around 4.25% while the 15 year fixed rate for rental properties rose three basis points to just under 3.50%. Major banks also raised their Prime rate to 3.50%.

Initially, stocks took off after the Fed announcement last Wednesday, surging by triple digits but since then Wall Street has had somewhat of a selloff and trading this morning saw the Dow around 17200. The tepid comments after the FOMC meetings caused many analysts to look for another rate increase sometime in the spring, with expectations for mortgage rates to remain near current levels. This also comes at a time when rental rates are continuing their upward pace, giving investors an early and extended Christmas present.

With the Christmas holiday falling on a Friday this year, we can expect a relatively quiet week on Wall Street with New Year’s Eve on Thursday of the following. Not very many trading days left in the year and consumers and investors alike have their minds on other things. For those who are in the process of closing on a deal before the year is out, it’s time to lock in those rates if you haven’t already. Lenders will be typically shorthanded with very little time to close out their deals before year end.