Multi-family leads to an increase in outstanding mortgage debt in the first quarter of 2021

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$ in billions

Source: MBA, Federal Reserve Board of Governors, Trepp LLC, Wells Fargo Securities, LLC, Intex Solutions, Inc.  and FDIC.
Source: MBA, Federal Reserve Board of Governors, Trepp LLC, Wells Fargo Securities, LLC, Intex Solutions, Inc. and FDIC.

The COVID-19 pandemic has impacted different types of property and sources of capital in different ways since March last year. Throughout this period, the indicators of the issuance of multi-apartment loans and lending activity remained stable.

According to the latest MBA report Outstanding commercial / multi-unit mortgage debt Commercial / multi-unit mortgage debt outstanding rose by $ 44.6 billion (1.1 percent) in the first quarter of 2021, according to the quarterly report. Total outstanding commercial / multi-family debt rose to $ 3.93 trillion at the end of the first quarter, with multi-family mortgage debt alone increasing $ 28.8 billion (1.7 percent) to $ 1.7 trillion over Q4 2020 of the year.

The volume of outstanding commercial and multi-family mortgages continued to rise during the first quarter during the pandemic, but the growth was uneven. All major sources of capital increased their holdings of commercial and multi-unit mortgages during the quarter, but nearly two-thirds of the total growth came from multi-unit real estate, with 80 percent of this growth in multi-unit buildings coming from the federal agency and GSE backed by mortgages. securities and portfolios.

When looking exclusively at multi-family mortgages in the first quarter of 2021, the agency, GSE and MBS portfolios account for the largest share of the total outstanding multi-family debt of $ 861 billion (50 percent), followed by banks and savings institutions with $ 481 billion ( 28 percent), life insurance. companies with revenue of $ 171 billion (10 percent), state and local governments with $ 106 billion (6 percent), and CMBS, CDO and other ABS issues, owning $ 53 billion (3 percent). Nonfarm unincorporated enterprises own $ 19 billion (1 percent).

As the uncertainty surrounding the COVID-19 pandemic eases, lenders will gain greater clarity on different properties and types of property and will be in a stronger position to issue new loans. This is especially true for apartment buildings, where low rates stimulate refinancing and high demand for housing.

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