Categorized | Finance and Mortgage

Originations of Commercial and Multifamily Loans Saw Massive Increase in 2Q

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With the overall market struggles, many investors made the switch to the real estate market in the second quarter. This movement definitely played a role in the huge increase in the number of originations of commercial and multifamily loans. In fact, the number of originations doubled from the previous quarter, and jumped an astounding one hundred and seven percent from last year.

An increased demand in health-care, hotel, and apartments played a significant role in the massive jump in originations. Health-care properties actually saw a one hundred and forty one percent increase, while hotels had a one hundred and twenty five percent increase. Both of these increases can be attributed to increased demand in the services of both areas.

With more Americans looking to rent instead of buy, both apartments and multifamily homes have also become quite the hot commodity. Rent rates have increased substantially, as there are less apartment vacancies, and increased demand.

The massive increases are a clear sign that borrowing and lending have risen from their dismal numbers over the past few years. However, experts warn that these increases could soon reverse or, at the very least, slow down, as the economy is now showing signs of a possible double dip.

Office property loans also demonstrated a slight increase, as did industrial loan originations. Even retail properties showed a strong gain. While there is no clear indication that these rates of increase will continue, it is definitely apparent that many investors are taking advantage of historically low mortgage rates.


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About Drew Wilson

Drew focuses on the Commercial and Mortgage/Finance categories.

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