Favorable market conditions helped spur a 19 percent increase in multifamily lending in 2018 to a new high in dollar volume, according to the Mortgage Bankers Association’s (MBA) annual report of the multifamily lending market.
Last year, 2,669 different multifamily lenders provided a record $339.2 billion in new mortgages for apartment buildings with five or more units. Forty-five percent of the active lenders made five or fewer multifamily loans over the course of the year.
“Borrowing and lending backed by multifamily rental properties set a new record in 2018, driven by strong property fundamentals, rising property values, low interest rates, and strong demand from both borrowers and lenders,” said Jamie Woodwell, MBA’s Vice President of Commercial Research and Economics. “We’ve seen these trends continue throughout 2019 and expect multifamily borrowing and lending will rise again both this year and next.”
MBA’s annual multifamily lending report is based on its surveys of multifamily lenders, as well as the Home Mortgage Disclosure Act (HMDA) data, which covers multifamily loans made by many smaller lenders, particularly commercial banks.
The $339.2 billion in originated multifamily mortgages went to a variety of investors. By dollar volume, the greatest share went to the Government Sponsored Enterprises (GSEs), Fannie Mae and Freddie Mac (42 percent).
The top five multifamily lenders in 2018 by dollar volume were Wells Fargo, CBRE Capital Markets, Inc., JP Morgan Chase & Company, Berkadia, and Walker & Dunlop.
MBA’s report is the most comprehensive view available of the multifamily lending market and includes:
- A detailed summary of the $339.2 billion multifamily market,
- Profiles of distinct market segments, including the very small loan (loans of $1 million or less) lender segment,
- A breakout of 2018 multifamily lending volume by investor group,
- A listing of 2,669 lenders who made multifamily loans in 2018, including their lending volume, number of loans made and average loan size, and
- A listing of metropolitan areas and the volume of very small loans made in each area in 2018.
The report is based on data from the MBA’s 2018 Commercial Multifamily Annual Origination Volume Summation and the Home Mortgage Disclosure Act (HMDA). The survey targets dedicated commercial/multifamily originators and covers $574 billion in commercial/multifamily loans in 2018. The HMDA data adds multifamily loans from banks, thrifts and other institutions that meet certain single-family origination thresholds. When combined, the two datasets provide the most complete assessment of the multifamily lending market available.
To purchase the report, please visit: https://www.mba.org/news-research-and-resources/research-and-economics/commercial/multifamily-research/annual-report-on-multifamily-lending.