Fannie Mae lending booms for multifamily properties

Fannie Mae's financing levels increased last year.

Many commercial property managers received some type of lending from Fannie Mae during the past year, as the level of financing from the government-sponsored enterprise rose to one of its highest points on record.

Fannie Mae offered a total of $33.8 billion in financing centered around multifamily properties during 2012, which came out to approximately 560,000 units receiving loans. The vast majority of this financing was through mortgage-backed securities. There also was a significant portion of the loans offered during 2012 through the government-sponsored enterprise’s Delegates Underwriting and Servicing program.

“In 2012 the multifamily market was strong, with solid fundamentals remaining in place,” said Jeffery Hayward, senior vice president and head of the multifamily mortgage business for Fannie Mae. “Private capital continued to return to the market, an important step to restoring a more normal lending environment.  Having a balanced market with diverse sources of liquidity and credit means the whole market is healthy and everyone is doing their part.  We look forward to continuing our work to provide liquidity, stability and affordability to the rental housing market.”

There were many aspects of  Fannie’s multifamily lending that improved during the year. Large loans – of $25 million or higher – rose to $11.6 billion during the year, which was much improved from the previous year’s level that was less than $5 billion. Small loans – of as much as $3 million, or $5 million in different parts of the country – improved to $3 billion from 2011′s level of $2.4 billion.

Multifamily affordable housing experienced a financing gain of more than $1 billion, as the total figure rose to $3.8 billion, the report added. There was also an improvement in the level of student housing loans, as this improved to more than $710 million, significantly higher than the previous figure of $233 million.

Rent growth improves in some areas
Lending increases may have helped grow some rental markets throughout the country. Last year, some rental markets experienced significant amounts of rent growth, and this was led by San Francisco, which jumped 8 percent year-over-year, MultiFamily Executive reported, citing a report from MPF Research.

San Jose and Oakland both performed strongly, as they had figures of 7.7 and 7.1 percent, respectively. There was also notable growth in Denver, Nashville and New York, which all rose more than 5 percent.

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