Commercial mortgage brokers looking to increase business this year would do well to seek out borrowers looking to finance multifamily investment properties.
The multifamily sector of the commercial market will remain strong, according to panelists at the National Association of Home Builders (NAHB) International Builders Show last week. Panelists at the press conference stressed the demand within the multifamily market over the past few years, and stated that demand should stay robust throughout 2015.
According to a National Mortgage Professional (NMP) article, the number of multifamily units forecast to be built is likely to reach a sustainable level of production higher than past production levels, and will probably level off in 2015 and into 2016.
“The multifamily industry is strong and producing more units than in previous cycles,” according NAHB Chief Economist David Crowe. “The industry has shown dramatic increases in construction since the recession, but the level of increase with moderate as we approach equilibrium.”
According to NMP, NAHB is forecasting that about 358,000 units will be developed in 2015 and about 361,000 units will be developed in 2016. The NAHB’s Multifamily Production Index, a survey of NAHB members’ attitudes toward the market, has also indicated that the industry is strong and will remain so.
While there are challenges that face the industry, such as increasing costs and labor shortages, the demand for apartments is still strong enough for developers to continue in most U.S. markets because of the need for affordable housing.
To find out what you need to submit to get a multifamily commercial mortgage approved, please read our blog “Getting Your Borrower to Qualify for Multifamily Financing.”