Higher Rates, Economic Uncertainty Slow Commercial Lending In The U.S.
According to the Mortgage Bankers Association, total U.S. commercial and multifamily mortgage borrowing and lending is expected to fall to $504 billion this year, which is a 38 percent decline from 2022’s total of $816 billion.
Multifamily lending alone (which is included in the total figures) is expected to drop to $299 billion in 2023 – a 38 percent decline from last year’s total of $480 billion. MBA anticipates borrowing and lending will rebound in 2024 to $856 billion in total commercial real estate lending, with $452 billion of that total in multifamily lending.
“Higher and volatile interest rates, uncertainty about property values, and questions about some property fundamentals have led to an impasse in property sales and mortgage originations activity this year,” said Jamie Woodwell, MBA’s Head of Commercial Real Estate Research. “Our baseline economic forecast anticipates that interest rates will moderate over the next year and half, helping to break the current logjam in transaction activity and bringing relief to financing costs and property valuations.”
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Source: www.worldpropertyjournal.com
ENB
Sandstone Group
