The Bureau of Labor Statistics reported in January that the Consumer Price Index (for all items) increased 7% for the 12 months ended December 2021, the highest inflation rate since 1982. In response, the Fed announced plans to raise rates at the Fed’s upcoming March 15 meeting. Some Wall Street analysts now predict four or more rate hikes this year to combat inflation.

At the same time, the Fed is dialing back its bond buying, announcing plans to purchase just $40 billion in this monthly round. This is down from $120 billion a month pre-November 2021. The dual threat of short-term interest rate hikes combined with the Fed tapering has pushed interest rates up. The yield on the US 10 Yr has climbed 35 basis points since year-end before coming back down recently, closing at 1.79% yesterday.

Despite the writing on the wall, interest rates on FHA commercial loans held steady through much of the latter half of 2021. However, these latest developments are finally making a dent in the HUD interest rate market. Rates have now climbed approximately 20-30 basis points since our last update in June. Check out today’s rates.

HUD Commercial Loan Rate Update – February 1, 2022

• 35-year fixed FHA perm loans: 2.65%-2.85%
• 40-year fixed FHA construction/perm loans: 3.20%-3.40% 

These pricing indications are current as of the date posted, subject to market interest rate volatility.  Pricing of FHA insured apartment and healthcare loans may be dependent on loan size and other risk factors. Call for more information.

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