According to the Mortgage Bankers Association's latest Commercial/Multifamily Delinquency Report
, commercial and multifamily mortgage delinquencies in the U.S. remained at a low rate in the final three months of 2018.
"It's hard to imagine commercial and multifamily mortgages performing much better than they have recently," said Jamie Woodwell, MBA's Vice President of Research and Economics. "Future performance will be largely driven by changes in the economy and how they affect property incomes, property values and the ability of owners to refinance when their loans come due. Currently, all of those factors are favorable."
MBA's quarterly analysis looks at commercial/multifamily delinquency rates for five of the largest investor-groups: commercial banks and thrifts, commercial mortgage-backed securities (CMBS), life insurance companies, Fannie Mae and Freddie Mac. Together, these groups hold more than 80 percent of commercial/multifamily mortgage debt outstanding.
Based on the unpaid principal balance (UPB) of loans, delinquency rates for each group at the end of the fourth quarter were as follows:
- Banks and thrifts (90 or more days delinquent or in non-accrual): 0.48 percent, unchanged from the third quarter of 2018;
- Life company portfolios (60 or more days delinquent): 0.05 percent, an increase of 0.01 percentage points from the third quarter of 2018;
- Fannie Mae (60 or more days delinquent): 0.06 percent, a decrease of 0.01 percentage points from the third quarter of 2018;
- Freddie Mac (60 or more days delinquent): 0.01 percent, unchanged from the third quarter of 2018; and
- CMBS (30 or more days delinquent or in REO): 2.77 percent, a decrease of 0.28 percentage points from the third quarter of 2018.