Most CRE, Multifamily Delinquency Rates Decline at Year-End: MBA
Improving housing markets continued to push down the overall delinquency rate of commercial and multifamily mortgages in the fourth quarter of 2013, according to the Mortgage Bankers Association.
At yearend 2013, the 60 or more days' delinquent rate for Fannie Mae-insured commercial and multifamily loans was 0.10%, down 14 basis points from yearend 2012 and down 8 basis points from the third quarter of 2013, based on unpaid principal balance. The corresponding rate for loans held in life company portfolios was 0.05%, down 3 basis points from a year ago, and 1 basis point from the previous quarter.
"Rising property incomes and values continue to boost the performance of commercial and multifamily mortgage loans," said Jamie Woodwell, MBA's vice president of commercial real estate research, in a press release.
Freddie Mac-insured loans had a 60-day delinquency rate of 0.09%, down 10 basis points from a year ago, but up 4 basis points from the third quarter, the MBA Commercial/Multifamily Delinquency report said.
Similarly, only 1.7% of loans held by banks and thrifts were 90 or more days delinquent or in nonaccrual, down 91 basis points from last year. Almost 7% of securitized loans were 30 or more days delinquent or in real estate owned status, down from a rate of 8.72% a year ago.
"Commercial and multifamily mortgages performed relatively well during the downturn, and for most investor groups delinquency rates are now back in the lower end of their historical range," Woodwell said.
Commercial and multifamily mortgage originations are expected to grow to $300 billion in 2014—a 7% increase from last year, according to MBA forecasts.