Multifamily lending hit record high in 2018

Multifamily lending hit record high in 2018
Multifamily continues to soar, rising to an all-time high in 2018 in terms of dollar volume, according the Mortgage Bankers Association’s annual report of the multifamily lending market.

Favorable market conditions helped spur a 19% increase in multifamily lending in 2018, according to the MBA’s report.

In 2018, 2,669 multifamily lenders originated a record $339.2 billion in new mortgages for apartment buildings with five or more units. About 45% of active lenders made five or fewer multifamily loans over 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 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.”

Last year, the MBA forecasted that multifamily lending was on track to set another record in 2018. And before that, the association reported multifamily hit an all-new high in 2017.

In fact, the multifamily market continues to grow over the past few years, and multifamily originations are projected to hit yet another all-time high in 2019 and again in 2020, according to the MBA.

MBA’s annual multifamily lending report is based on its surveys of multifamily lenders, as well as the Home Mortgage Disclosure Act 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 Fannie Mae and Freddie Mac with 42%.

The top five multifamily lenders in 2018 by dollar volume were Wells Fargo, CBRE Capital Markets, JPMorgan Chase, Berkadia and Walker & Dunlop.

And click here to see which multifamily lenders are dominating so far in 2019.