WASHINGTON, DC (May 9, 2024) — Commercial and multifamily mortgage lending was little changed in the first quarter of 2024 compared to the same period a year ago and down 23% from the fourth quarter of 2023, according to the Mortgage Bankers Association’s (MBA) quarterly Commercial and Multifamily Mortgage Lending Survey. “Commercial real estate secured borrowing and lending remained weak in the first quarter of 2024,” said Jamie Woodwell, MBA's head of commercial real estate research. “Rising interest rates and uncertainty about their direction have many current owners holding back, and few are recommending selling or refinancing unless something forces…
Author: Private Lending Agent
What does that feel like? The combination of declining asset values and increasing debt service requirements can create a funding shortfall. With a funding shortfall comes new challenges. For example, commercial mortgage borrowers will need to find ways to make up the shortfall. This may mean putting more equity into the property, raising additional financing from non-traditional sources, or selling the property. In some cases, this dichotomy could lead some property owners and commercial mortgage borrowers to default on their debt, which is a situation you want to avoid. Indeed, interest rates are expected to fall in 2024. Still, the…
With $929 billion in commercial real estate debt coming due, can America's community banks weather this crisis?Entrepreneur Tom Ellsworth believes the US banking system is in the midst of a “crisis,” and there are two opposing issues that are battering its foundations.Of the $4.7 trillion in outstanding commercial mortgages held by U.S. lenders and investors, one-fifth, or $929 billion, will come due in 2024, according to the Mortgage Bankers Association's (MBA) 2023 Commercial Real Estate (CRE) Loan Maturity Volume Study.do not miss itThis means problems for America's smaller commercial banks and private mortgage lenders, who are feeling the strain of…
May 8, 2024 Justin Jesso Are you interested in the real estate deal strategies I use to keep getting great deals in today's market? Whether you're an investor eyeing your next property flip or an avid homeowner looking for a bargain, finding a good deal is important. In this comprehensive guide, I'll explain the six strategies I use to get great deals and share some recent examples. Video: Finding a Real Estate Transaction Strategy Real Estate Transaction Strategy Video 6 strategies for finding bargains MLS Many people think that the Multiple Listing Service (MLS) is only for experienced investors. But…
CDFIs that lend in low-income areas report increased demand for their products, but these mission-driven institutions say they can't keep up with the demand for loans. The New York Fed's Community Development Team is studying the role that a stronger secondary market for CDFI-financed loans could play in increasing the sources of capital available to CDFIs, such as lending funds, credit unions, and banks. Certified CDFIs are eligible for competitive federal grants to cover loans such as mortgages for first-time homebuyers. The Community Development Team’s latest publication on CDFIs, “A Study of Loan Origination and Sales by Community Development Financial…
When WeWork emerges from bankruptcy, it will likely have a surprising new owner.Yardi Systems, a Santa Barbara-based software company with no experience in real estate management, would run WeWork if the bankruptcy court's plan is approved.Why would Yardi, a property management software business, want to buy a coworking company that hasn't been able to turn a profit since it was founded?There's been a lot of speculation about Yardi's intentions. Some speculate that the company, led by the media-shy Anant Yardi, will somehow combine WeWork's real estate with Yardi's software business. It's all Yardi's grand plan. WeWork is finally a tech…
Credit/Adobe Stock On Monday, May 6, $4.4 billion Westbury, New York-based Jovia Financial Credit Union officially launched a wholly owned commercial real estate servicing CUSO, Jovia Commercial Lending LLC. The CUSO was designed to help small financial institutions, such as credit unions, community banks, commercial mortgage brokers and lenders, manage and/or expand their commercial real estate lending services. The organization is led by President Casey Mauldin, who also serves as Jovia Financial's chief revenue officer and chief lending officer. Other leaders of the CUSO include Treasurer Karen Smith, Jovia Financial's chief financial officer, and Secretary Howard Sim, vice president of…
May 8, 2024 The Federal Reserve has kept the federal funds rate, the interest rate at which commercial banks can borrow and lend overnight, unchanged since July 26, 2023. The federal funds rate is used by the Federal Reserve to keep inflation in check, but the rate also influences the federal government's borrowing costs and, therefore, the nation's fiscal position. The federal funds rate is a benchmark for Treasury bills and other short-term securities. Adjustments to interest rates are an important tool by which the Federal Reserve accomplishes its statutory mission: to promote the goals of maximum employment, stable price…
Calculated Risk May 8, 2024 2:53 PM From Dodge Data Analytics: Dodge Momentum Index rose 6% in AprilThe Dodge Momentum Index (DMI) released by the Dodge Construction Network rose 6.1% in April to 173.9 (2000 = 100) from a revised 164.0 in March. Commercial plans improved 12.6% and institutional plans declined 6.3% for the month.”The Dodge Momentum Index (DMI) saw positive developments in April as a large volume of data center projects entered the planning stages,” said Sarah Martin, associate director of forecasting at Dodge Construction Network. “Unusually strong demand for cloud and AI infrastructure builds supported above-average activity in…
Key Takeaways Commercial real estate loans are used to purchase, build, renovate, or refinance commercial real estate rather than residential. However, they may also be used to purchase and develop land on which to build and sell homes. With CRE loans, the borrower's credit and income are less important than with mortgages, with the income potential of the property being the primary driver. Whether you're a developer embarking on a new subdivision project or an office building owner looking to refinance, you likely need a commercial real estate loan. Unlike residential real estate, commercial real estate refers to property used…