Delinquency Rates Continue to Decline for Commercial & Multifamily Mortgages
In a recently released report from the Mortgage Bankers Association, commercial and multifamily mortgage delinquencies remained at the lower end of their historical range in the first quarter of 2022.
The quarterly analysis from MBA looks at the commercial/multifamily delinquency rates for the five investor groups responsible for 80 percent of the commercial and multifamily mortgage debt outstanding: banks and thrifts, CMBSes (which pool mortgages), life insurers, and Fannie Mae & Freddie Mac.
The analysis incorporates the measures used by each investor group to track their loan performance. Because these are tracked differently, delinquency rates between different groups cannot be compared meaningfully without taking into account what they define as delinquent.
Comparing unpaid principal balance of loans from the fourth quarter of 2021 to the end of the first quarter of 2022, delinquency rates for each group were:
- CMBS (30 or more days delinquent or in REO): 3.36%
- Freddie Mac (60 or more days delinquent): 0.08%
- Fannie Mae (60 or more days delinquent): 0.38%
- Life company portfolios (60 or more days delinquent): 0.05%
- Banks and thrifts (90 or more days delinquent or in non-accrual): 0.56%
Commercial Real Estate Lending in U.S. Maintains Momentum in Q1
Noted in CBRE’s latest report, the U.S. multifamily sector is setting the pace for a record-breaking year, with New York positioning for the top spot.
In the first quarter of this year, rent prices for multifamily properties in New York City continued to rise. Strong demographic trends are driving record leasing activity and demand, which has resulted in substantial growth across all sectors, including commercial real estate, where employment opportunities and wage growth continue to improve.
The multifamily sector in New York was one of the top markets for investment sales this quarter, accounting for nearly $18 billion worth. That’s more than double what it was last year — and as a whole, it accounted for 37% of total commercial real estate volume, followed by office at 21% and industrial at 20%.
With robust demographics underpinning these positive changes within NYC’s economy, it remains one of its hottest markets today with increasingly tight inventory conditions.
Extensia Financial is one of the most seasoned credit union service organizations (CUSO) focused on commercial real estate.
Our lending experts have a wealth of experience in the Commercial and Multifamily sector and can guide you through each stage of the process.
Our loans range in size from $1M to $30M and generally have terms of five to ten years with amortization of up to 30 years.