😨 Delinquency Drama & CRE Conversions
Mortgage mishaps surge; New life for old spaces
In today's fast-paced real estate world, keeping an eye on mortgage trends is more crucial than ever, especially for those of you looking at distressed assets.
We're seeing a noticeable uptick in delinquency rates for commercial and multifamily mortgages.
This situation is throwing up red flags but also waving some potential golden tickets for savvy investors.
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Now, let's shift gears to rental trends.
While mortgages are doing their dance, rents have been sort of leveling off.
We've also got office spaces feeling a bit lonely with the work-from-home wave, hinting at a mix of risk and chances in office property investments.
The government's big push to turn commercial spaces into cozy apartments could be your next big play.
In this edition of the AltReports:
🤕 Mortgage Migraines
📈 Rent Rampage
💼 Securities Showdown
🏡 Housing Hype
🕰️ Fed Flashback
💀 Cadaver Clauses
Video of the Week: Top 3 Florida Counties Facing Deed Price Correction
Chart of the Week: Housing Demand is Being Attacked on Both Sides
Podcast of the Week: How to Turn a Recssion into Riches
Price Uncertainty Pushes CRE, Multifamily Mortgage Delinquency Rates Up
Big surprise! Delinquencies in commercial and multifamily mortgages are up in Q2 of 2023.
Shaky interest rates, uncertainty about property costs, and stressed-out markets aren't good for CRE values.
Major investor groups, which look after over 80% of the commercial/multifamily mortgage debt, are all having a headache maintaining and managing delinquency rates.
Housing Market: This Chart Shows How Rent Prices Evolved in Last Decade
Alright, let's do some numbers. Rents have been hitting the gym, pumping up 3.2% year-over-year to a buff $2,047 in September.
Yet the gains are getting leaner; the rent growth rate's been on a diet for 19 consecutive months.
Big city rents were a mixed bag; Milwaukee, Virginia Beach, and Philadelphia rents flexed the most, while Austin, Memphis, and Orlando deflated.
US CMBS Set for 'Tug of War' as Office Foreclosures Loom
On one side, we've got cheeky property owners who'd rather have root canals than pay off their office loans.
On the other end, we have the lingering effects of the huge shift to working from home.
Office space has become about as useful as decaffeinated coffee over lockdown.
White House, Federal Agencies Urge More Commercial-to-Residential Property Conversions
The bigwigs at the White House and the HUD aim to upgrade the inventory of affordable houses by pimping commercial buildings into apartment complexes.
They're sliding $10 billion into a fund!
What's more, there's a step-by-step cookbook in the mix for all the puzzled people on how to fund similar projects.