Multifamily mortgage originations jump to start 2012

Mortgage originations for multifamily properties increased in the first part of 2012.

More property management companies may be purchasing multifamily properties, as the number of mortgage originations for these jumped during the first quarter, according to the Mortgage Bankers Association.

In total, mortgage originations for multifamily properties increased by 45 percent year-over-year during the first quarter. This pushed commercial and multifamily market activity to improve 36 percent above the same point in 2011. However, mortgage originations declined by 12 percent when compared to the fourth quarter, while total multifamily lending was down 22 percent.

"Borrowing and lending on commercial and multifamily properties continues to rebound from the lows seen during the Great Recession," said Jamie Woodwell, MBA's vice president of commercial real estate research. "The low interest rates and stabilization in commercial real estate fundamentals that raised origination levels by 55 percent in 2011 are continuing to buoy activity in 2012."

The gaps between the fourth quarter and the first quarter may have been due to the multifamily industry's desire to have a strong end to the year, as the first quarter is typically slower for many companies, the report added.

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