Author(s): Federal Reserve Bank of San Francisco
The residential housing market is showing signs of cooling-off, but continuing economic growth should sustain a more moderated pace of appreciation. CRE market fundamentals are healthy and/or recovering throughout most of the 12th District. Forecasts call for continuing improvement in 2014. Bank lending risks have declined substantially over the past few years. Issues worth monitoring are 1) the possible impact of rising adjustable loan rates on borrowers’ ability to pay, and 2) rapid rates of loan growth at some financial institutions, particularly on multifamily properties.
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