According to the Mortgage Bankers Association's latest Commercial and Multifamily Delinquency Report, delinquency rates for commercial and multifamily mortgage loans in the U.S. remained low in the first quarter of 2016.
"Strong fundamentals and strong property prices, as well as still low interest rates, continue to support the performance of commercial and multifamily mortgages," said Jamie Woodwell, MBA's Vice President of Commercial Real Estate Research. "A record decline in the volume of CMBS loans in foreclosure and REO brought a record decline in the delinquency rate for loans held in CMBS. At the same time, delinquency rates remain extremely low for commercial and multifamily mortgages held by life insurance companies, Freddie Mac, Fannie Mae and banks and thrifts."
Based on the unpaid principal balance (UPB) of loans, delinquency rates for each group at the end of the first quarter were as follows:
Banks and thrifts (90 or more days delinquent or in non-accrual): 0.73 percent, unchanged from the fourth quarter of 2015;
Life company portfolios (60 or more days delinquent): 0.06 percent, an increase of 0.02 from the fourth quarter of 2015;
Fannie Mae (60 or more days delinquent): 0.06 percent, a decrease of 0.01 percentage points from the fourth quarter of 2015;
Freddie Mac (60 or more days delinquent): 0.04 percent, an increase of 0.02 percentage points from fourth quarter of 2015;
CMBS (30 or more days delinquent or in REO): 3.93 percent, a decrease of 0.80 percentage points from the fourth quarter of 2015.
The MBA 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.