Commercial, multifamily lending improves in second quarter

It appears the residential housing market is finding its footing after years of instability, but throughout this period, the commercial sector has been a bright spot in an otherwise bleak landscape.

It appears the residential housing market is finding its footing after years of instability, but throughout this period, the commercial sector has been a bright spot in an otherwise bleak landscape.

During the second quarter, commercial and multifamily lending increased 25 percent from a year earlier and 39 percent from the previous quarter, according to a report from the Mortgage Bankers Association. Meanwhile, mortgage records indicates the delinquency rates on these types of loans declined 0.4 percent, equaling roughly $10.4 billion, the report said.

However, the delinquency rate on loans tied to commercial mortgage-backed securities edged higher during the second quarter. Real estate-owned properties and foreclosed houses were believed to be significant factors weighing heavily on these loan pools.  

To curb this issue, one expert from Freddie Mac proposed a plan to float K-certificates and assist local housing markets, which could stabilize both the residential and commercial sectors.

"This deal is the next step toward our goal of offering the broadest array of financing options to our borrowers and the investor community," said Freddie Mac vice president of multifamily capital markets Mitch Resnick.



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