While the 2008 financial crisis prompted a cyclical shift in U.S. housing — impacting everything from home prices to who can qualify for a mortgage — an equally impactful demographic change was just taking shape. The unprecedented wave of Baby Boomers that began retiring would disrupt the balance of the housing market.
Small Balance Lending Surges Through First Half of 2019
Small balance multifamily lending volume in the first half of 2019 totaled $58.5 billion on an annualized basis, representing a 7.9% gain from 2018’s total.
Whether the macroeconomic and real estate cycle continues to lengthen or we begin to see signs of a market correction, we can expect the small balance market to hold steady as lenders continue to maintain conservative underwriting. In the interim, favorable interest rates will elevate refinancing activity, and the sector’s continued maturation and increased agency support will continue to promote liquidity in the space.
For more insights on the small balance multifamily sector, read Arbor Chatter’s “Q2 2019 Small Balance Multifamily Investment Trends Report.”
Explore charts and insights, including:
- Lending Volume
- Cap Rates & Spreads
- Interest Rates
- Leverage & Debt Yields