It’s been more than four years since delinquency on securitized commercial real estate loans has been this low, while it’s been even longer since performance on Freddie Mac and bank-owned CRE loans has been this good.
Among investors types, loans included in commercial mortgage-backed securities saw the biggest improvement in delinquency between the first and second quarters: 45 basis points.
That left the 30-day rate at 5.71 percent — the lowest CMBS delinquency rate since it was 5.70 percent in the fourth-quarter 2009.
The findings were detailed in the MBA Commercial Real Estate/Multifamily Finance Mortgage Delinquency Rates for Major Investor Groups Q2 2014 from the Mortgage Bankers Association.
In the same three-month period during 2013, the CMBS delinquency rate was 7.84 percent.
CMBS 30-day delinquency subsequently increased 5 BPS from the end of the second quarter to the end of August, according to Trepp LLC.
The next-biggest improvement was made with CRE loans owned by banks and thrifts, with 90-day delinquency tumbling 17 BPS from the first quarter to 1.40 percent. The improvement was even more significant given that the 90-day rate moves in a much more narrow range than the 30-day rate.
Delinquency on bank and thrift loans was 2.18 percent in the second-quarter 2013.
The past-due rate on bank-owned loans was last this low in the third-quarter 2008, when it stood at 1.39 percent.
Sixty-day multifamily delinquency at government-controlled Freddie Mac fell to 0.02 percent in the second quarter from 0.04 three months earlier and 0.09 percent 12 months earlier.
Freddie’s delinquency rate was at its lowest point since it was 0.02 percent in the fourth-quarter 2007. The McLean, Va.-based company’s multifamily delinquency rate has since risen to 0.05 percent as of July.
At Freddie’s secondary rival, Fannie Mac, 60-day multifamily delinquency has been the same for three quarters: 0.10 percent. The Washington-based company’s rate plunged from 0.28 percent in the second-quarter 2013 and remained at its lowest level since it was 0.09 percent in the first-quarter 2008.
Fannie recently reported that its multifamily delinquency rate didn’t change in July.
The only investor type to see CRE loan delinquency deteriorate from the first quarter was life insurance companies. The 60-day rate climbed 3 BPS to 0.08 percent and was unchanged compared to a year earlier.
