CREF Policy Update: Federal Reserve Cuts Rates by 25 Basis Points; Third Rate Cut of 2024
Federal Reserve Cuts Rates by 25 Basis Points; Third Rate Cut of 2024
Somewhat softer inflation data and higher unemployment gave the Federal Reserve enough evidence to cut short-term rates by another 25 basis points to a target range of 4.25% to 4.50%. This rate cut marks the third of 2024.
• The FOMC stated that it “will carefully assess incoming data, the evolving outlook, and the balance of risks,” and “will continue to monitor the implications of incoming information for the economic outlook.”
Read MBA SVP and Chief Economist Mike Fratantoni’s full commentary here.
For more information, please contact Mike Fratantoni at (202) 557-2935.
Commercial and Multifamily Mortgage Debt Outstanding Increased $47.7 Billion in Third Quarter of 2024
The level of commercial/multifamily mortgage debt outstanding increased by $47.7 billion (1%) in the third quarter of 2024, according to MBA’s latest Commercial/Multifamily Mortgage Debt Outstanding quarterly report, released yesterday.
Why it matters: Total commercial/multifamily mortgage debt outstanding rose to $4.75 trillion at the end of the third quarter. Multifamily mortgage debt alone increased $29.8 billion (1.4%) to $2.12 trillion from the second quarter of 2024.
MBA’s Head of Commercial Real Estate Research, Jamie Woodwell, said, “Every major capital source for commercial mortgage debt increased its holdings of mortgages during the third quarter of 2024. Life insurance companies led the way, accounting for 44% of the quarterly increase and boosting their commercial mortgage holdings by nearly three percent. That increase contrasts with banks, which increased their balances of CRE mortgages during the quarter by only 0.3%. For the ninth quarter in a row, aggregate balances backed by multifamily properties increased more than those backed by other property types.”
Go deeper: Commercial banks continue to hold the largest share (38%) of commercial/multifamily mortgages at $1.8 trillion. Agency and GSE portfolios and MBS are the second-largest holders of commercial/multifamily mortgages (22%) at $1.03 trillion. Life insurance companies hold $757 billion (16%), and CMBS, CDO and another other ABS issues hold $619 billion (13%). Many life insurance companies, banks and the GSEs purchase and hold CMBS, CDO and other ABS issues. These loans appear in the report in the “CMBS, CDO and other ABS” category.
To view the full report, click here.
For more information, please contact Jamie Woodwell at (202) 557-2936.
Commercial Mortgage Delinquency Rates Continue to Increase in Third Quarter of 2024
Commercial mortgage delinquencies increased in the third quarter of 2024, according to MBA’s latest Commercial Delinquency Report, released recently.
MBA’s Head of Commercial Real Estate Research, Jamie Woodwell, said, “The share of the balance of delinquent commercial mortgages increased for every major capital source during the third quarter of 2024. The increases varied by capital source and were driven by the particularities of each individual loan and property. Stresses differ by property type and subtype, geographic market and submarket, loan type and vintage, borrower type and more.”
To view the full report, click here.
For more information, please contact Jamie Woodwell at (202) 557-2936.
Upcoming MBA Education Webinars on Critical Industry Issues
MBA Education continues to deliver timely commercial/multifamily and single-family programming that covers the spectrum of challenges, obstacles and solutions pertaining to our industry. Below, please see a list of upcoming and recent webinars – all complimentary to MBA members:
• Managing Rising Insurance Risks in Commercial Lending – Jan. 14
• Fundamentals of Commercial Insurance Issues and Problems – Jan. 28
• CREF Career Conversations: Insights from Industry Leaders – Jan. 28
•Navigating and Ensuring Accurate Reporting with the MBA Commercial and Multifamily Inspection Form – Jan. 30
MBA members can register for any of the above events and view recent webinar recordings by clicking here.
For more information, please contact David Upbin at (202) 557-2931.
