Will the logical prevail?

We have been told that the Brexit would lose. It didn’t. The polls told us that Hillary would win. She didn’t. The American electorate was told of the thousands of jobs lost to China. When in reality they were lost to automation. And now we are being told that when interest rates rise so too will yields. It’s logical that they should. The cost of borrowing rises with higher interest rates , which should in theory mean that prices ease.
But we believe that emotion is playing a larger part in buying decisions than interest rates. We have plenty of evidence that logic does not always apply. Just look at yields for small suburban shops.
I believe that over the next six months what we will see is emotion being a more significant driver of price than interest rates. Emotion coming from the fear of missing out after investors have been out-bid two or three times. Emotion arising from the fear of zero (or close to it) interest from deposits with banks. And emotion from owner-occupiers as rental rates rise in response to low occupancy rates and the increased cost of construction.
So we will be placing our bets on a continued softening in yields, albeit small, over the first half of 2017. Illogical?

Yes, but so is a lot else going on in the world currently.