Last week, the Federal Reserve announced an increase in its key interest rate by 0.25 percent, only the second increase in a decade.
Jim Gaines, Chief Economist at the Real Estate Center at Texas A&M, said the short-term impact on the housing market could be an increase in demand.
“They’re saying prices are still going up because there is a shortage of houses and if the interest rate is going to go up during the course of the year, I have no reason to wait,” Gaines said of home buyers.
Gaines said this rate increase coupled with the outcome of the presidential election could also have a very positive impact on the business market.
“The businesses now are going to get off the side and they’re going to start investing back into corporate America and business main street,” said Gaines.
This is only the second interest rate increase in a decade, but the Fed said it expects three more rate increases in 2017.
Click below to hear Jim Gaines visiting with WTAW’s Chelsea Reber.