Commercial, multifamily delinquencies hover near 2-decade lows

by Ryan Smith13 Sep 2016
Commercial and multifamily mortgage delinquencies are near two-decade lows, according to new data from the Mortgage Bankers Association. However, delinquencies were on the rise in some commercial investor groups.

“For most capital sources, commercial and multifamily mortgage delinquency rates are near the lowest levels seen during the past 20 years,” said Jamie Woodwell, MBA vice president of commercial real estate research. “Strong property fundamentals, rising property values and solid mortgage availability are all supporting these rates.”

MBA’s analysis considered commercial and multifamily delinquency rates for five of the largest investor groups: commercial mortgage-backed securities, commercial banks and thrifts, life insurance companies, Fannie Mae and Freddie Mac.

“Together, these groups hold more than 80 percent of commercial/multifamily debt outstanding,” the MBA reported.

The MBA found the delinquency rate for each group was:
  • Banks and thrifts (90+ days delinquent or in non-accrual): 0.66%, a drop of 0.7% from the first quarter
  • Life company portfolios (60+ days delinquent): 0.11%, up 0.05% from Q1
  • Fannie Mae (60+ days delinquent): 0.07%, an increase of 0.01 percentage points from Q1
  • Freddie Mac (60+ days delinquent): 0.02%, a decrease of 0.02 percentage points from Q1
  • CMPS (30+ days delinquent or in REO): 4.04%, an increase of 0.17 percentage points from Q1
Construction and development loans weren’t included in the MBA’s report, since they’re often backed by single-family residential projects rather than commercial or multifamily projects.
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