Housing Finance Policy Center
Lunchtime Data Talk
Multifamily Rental: Data and Analysis
Mark Obrinsky,
National Multi Housing Council
Jamie Woodwell,
Mortgage Bankers Association
January 13, 2014
1
Multifamily Rental Data
Mark Obrinsky
SVP of Research and Chief Economist
January 13, 2014
2
• Apartments: both residential and “commercial”
• “Space” markets vs. “asset” markets
• Space market data:
 Supply: existing stock, new construction, losses, occupied
vs. vacant, characteristics, etc.
 Demand: demographics, economics, etc.
 Interaction of S & D: rents, absorptions, occupancy
(vacancy) rates, etc.
• Asset market data:
 Transactions
 Property prices
 Income, expenses, NOI, and cap rates
 Mortgage finance
3
NMHC’s Quarterly Survey of
Apartment Market Conditions
•
•
•
•
Started in July 1999.
Sent to most NMHC members.
Average of 80 respondents per quarter.
Each survey asks about market tightness, sales
volume, equity financing, and debt financing – better,
worse, or the same as three months earlier?
• In addition to response shares, we calculate indexes.
• Calculated Risk: “This index helped me call the
bottom for effective rents (and the top for vacancy
rate) early in 2010.”
4
Market Tightness Index
100
90
80
70
60
50
40
30
20
10
0
1999
2001
Source: NMHC.
2003
2005
2007
2009
2011
2013
5
Market Tightness vs. Occupancy
100
100
NMHC Market Tightness Index
MPF Occupancy Rate
90
99
80
70
97
60
50
96
40
95
30
94
20
93
10
0
2000
92
2002
2004
Source: MPF Research; NMHC.
2006
2008
2010
2012
6
MPF Occupancy Rate
Market Tightness Index
98
Differing Household Estimates
(millions)
Occupied
Households
Census
2010
ACS
2010
CPS
2010
HVS
2010
116.7
114.6
117.5
112.0
Owner
76.0
74.9
78.8
75.5
Renter
40.7
39.7
38.8
37.4
65.1%
65.4%
67.0%
66.8%
Total
Ownership
rate
Source: Census Bureau; NMHC.
7
Differing Apartment Stock Estimates
5+ Multifamily
(millions)
AHS
2011
ACS
2011
CPS
2011
Occupied Units
16.0
17.4
17.2
Vacant Units
2.0
1.7
NA
Rented, not occupied
0.1
0.3
NA
18.2
19.4
NA
Total
Source: Census Bureau; NMHC.
8
Excess Apartment Inventory: How Big?
5+ vacancy rate (HVS)
All years (1968-2013)
9.1%
1970-1999
8.7%
2012
9.3%
Apartment Stock
AHS
18.2 million
ACS
19.4 million
“Excess” Vacant Apartments
AHS
110k
ACS
180k
Source: Census Bureau; NMHC.
9
New Apartment Construction:
How Much Is Needed?
Needed apartments:
= new households
x renter share of new households
x apartment share of new renters
Needed construction:
= net absorption
+ net losses to stock
+ change in number of vacant units
10
Historical Data – Decennial Census
Households
(millions)
CAGR
chg in HHs
(millions)
chg in renters
(millions)
Renter
Share
Rentership
Rate
1950
42.8
2.1%
8.0
-0.4
-5%
45%
1960
53.0
2.2%
10.2
1.0
9%
38%
1970
63.5
1.8%
10.4
3.3
32%
37%
1980
80.4
2.4%
16.9
5.1
30%
36%
1990
91.9
1.4%
11.6
4.3
37%
36%
2000
105.5
1.4%
13.5
2.7
20%
34%
2010
116.7
1.0%
11.2
5.1
45%
35%
Projection Scenarios
Households
2012 CPS
121.1
2022a
133.8
2022b
136.4
CAGR
chg in
HHs
Renter
share
1.0%
12.7
35%
40%
4.4
5.1
45%
2.0
2.3
1.2%
15.3
35%
40%
5.4
6.1
45%
2.4
2.8
Source: Census Bureau; NMHC.
chg in Apt renter
renters
share
chg in apt
renters
11
Net absorption annually:
Losses to stock annually:
Change in vacant units:
200-280k
~ 100k
0
Hence, needed new construction annually:
300-380k
12
Multifamily Supply Rebounding
(6mo moving average, 000s)
400
Starts
300
200
Completions
100
0
1990
1993
1996
1999
2002
2005
Source: Census Bureau, Survey of Construction.
2008
2011
13
Apartment Fundamentals: Rent Growth (Nominal vs. Real)
12%
9%
Nominal
6%
3%
0%
Real
-3%
-6%
1994
1997
2000
2003
Source: MPF Research; BLS; NMHC.
2006
2009
2012
14
Population 20-34 Years of Age
Millions
90
80
70
60
50
40
1990 1995 2000 2005 2010 2015 2020 2025 2030 2035 2040 2045 2050
Source: Census Bureau.
APARTMENT INDUSTRY
UPDATE
15
Demographic Trends: Young People More Likely to Rent
70%
60%
50%
40%
30%
20%
10%
0%
Under 35
35 to 44
45 to 54
55 to 64
Source: U.S. Census Bureau, Current Population Survey, ASEC 2013.
65 and Over
16
Young Adults 18-34 Years Old Living with Parents:
Pent-Up Demand for Apartments?
Millions
23
32%
22
Number
31%
Share
21
30%
20
29%
19
28%
18
27%
17
26%
16
25%
1983
1987
1991
1995
1999
2003
Source: Census Bureau, Current Population Survey.
2007
2011
17
Demographic Trends: Changing Household Composition
Millions
40
1963
2013
35
30
25
20
15
10
5
0
Married with
Kids
Married, No Single Parent
Kids
Singles
Source: U.S. Census Bureau, Current Population Survey, ASEC 2013.
Other
18
For more information go to:
www.nmhc.org, then
“Research & Statistics,” then
“Sources of Apartment Data”
19
Mortgage Bankers Association
Multifamily Lending Data
January 13, 2014
Presented by
Jamie Woodwell
Vice President, Commercial Real Estate Research
Mortgage Bankers Association
MBA Multifamily (and Commercial)
Data Series
Lending Activity
 Annual Originator Ranking
 Annual Origination Summation
 Annual Report on Multifamily Lending
 Quarterly Origination Index
Outstanding Mortgages
 Semiannual Servicer Ranking
 Quarterly Mortgage Debt Outstanding
 Annual Loan Maturity Volumes
Outlook
 Commercial Real Estate Finance Forecast
 2014 CREF Outlook Survey
21
MBA’s Annual Report on
Multifamily Housing, 2012
22
MBA Annual Commercial/Multifamily Origination
Summation, Coverage, 2012 ($Billions)
$60
$50
$40
$30
$10
Includes $2.4 billion
of bond credit
enhancements
Includes $1.8 billion
of structured
$20
$0
Life Companies
Fannie Mae
Freddie Mac
MBA Annual Origination Summation
CMBS
Benchmark
Sources: Mortgage Bankers Association, Annual Origination Summation, ACLI, Fannie Mae, Freddie Mac, Commercial Real
Estate Direct
23
Multifamily Lending, 2012 ($Millions)
$300,000
$250,000
$200,000
$150,000
$100,000
$50,000
$0
MBA Annual Origination Summation
Multifamily
MBA Annual Report on Multifamily
Lending
Other Property Types
HMDA Addition
Source: Mortgage Bankers Association, Annual Origination Summation and Annual Report on Multifamily Housing
24
Multifamily Lending, 2012
Number of Lenders
Average Loan Size ($millions)
3,000
$12
2,500
$10
2,000
$8
1,500
$6
1,000
$4
500
$2
0
$0
MBA Survey
HMDA Addition
MBA Survey
Dollar Volume ($millions)
$120,000
HMDA Addition
Number of Loans
35,000
30,000
25,000
20,000
15,000
10,000
5,000
0
$100,000
$80,000
$60,000
$40,000
$20,000
$0
MBA Survey
HMDA Addition
MBA Survey
HMDA Addition
Source: Mortgage Bankers Association, Annual Origination Summation and Annual Report on Multifamily Housing
25
Multifamily Lending, 2012
• 41,106 multifamily loans closed
• $146.06 billion
• Average Loan Size $3.6 million
• 2,803 multifamily lenders
• Average of 15 loans per lender
26
Multifamily Lending in 2012,
By Lender Average Loan Size
Number of lenders,
Number of loans
$millions of loans,
by lender average
by lender average
by lender average
loan size
loan size
loan size
Lender Avg Loan > $10 million
Lender Avg Loan $3 - $10 million
Lender Avg Loan $1 - $3 million
Lender Avg Loan <= $1 million
Source: Mortgage Bankers Association, Annual Report on Multifamily Lending
27
Largest and (almost) Smallest Multifamily
Lenders in 2012, by dollar volume
28
Source: Mortgage Bankers Association, Annual Report on Multifamily Lending
Multifamily Lending, 2012
Number of Loans
25,000
Dollar Volume ($millions)
$160,000
$140,000
20,000
$120,000
$100,000
15,000
$80,000
10,000
$60,000
$40,000
5,000
$20,000
0
$0
$500,000 or $500,000 to > $ 1 million
less
$1 million
Loan Size
$500,000 or $500,000 to > $ 1 million
less
$1 million
Loan Size
Source: Mortgage Bankers Association, Annual Origination Summation and Annual Report on Multifamily Housing
29
Total and Institutional Multifamily Lending
($Millions)
Total multifamily lending
$160,000
Institutional multifamily lending
$140,000
$120,000
$100,000
$80,000
$60,000
$40,000
$20,000
$0
2005
2006
2007
2008
2009
Source: Mortgage Bankers Association, Annual Origination Summation and Annual
Report on Multifamily Housing
2010
2011
2012
30
Number of Multifamily Loans by Loan Size
Loans <= $1 million
35,000
Loans > $1 million
30,000
25,000
20,000
15,000
10,000
5,000
0
2005
2006
2007
2008
Source: Mortgage Bankers Association, Annual Report on Multifamily Housing
2009
2010
2011
2012
31
Multifamily Mortgage Lending, 2012
($millions)
$60,000
$50,000
$40,000
$30,000
$20,000
$10,000
$0
Fannie Mae Banks and
and Freddie
thrifts
Mac
FHA
Life
companies
Source: Mortgage Bankers Association, Annual Report on Multifamily Housing
CMBS
Others
32
Estimates of GSE Multifamily Lending
Volume ($millions)
MBA Fannie Mae
AHAR Fannie Mae
MBA Freddie Mac
AHAR Freddie Mac
50,000
45,000
40,000
35,000
30,000
25,000
20,000
15,000
10,000
5,000
0
2005
2006
2007
Source: Mortgage Bankers Association and FHFA
2008
2009
2010
2011
2012
33
Estimates of Life Company Multifamily
Lending Volume ($millions)
MBA Life Commercial/Multifamily
MBA Life Multifamily
ACLI Life Commercial/Multifamily
ACLI Life Multifamily
60,000
50,000
40,000
30,000
20,000
10,000
0
2005
2006
2007
Source: Mortgage Bankers Association and ACLI
2008
2009
2010
2011
2012
34
Estimates of CMBS Multifamily Lending
Volume ($millions)
JP Morgan/MBA CMBS multifamily
250,000
MBA Commercial/Multifamily
JP Morgan Commercial/Multifamily
200,000
150,000
100,000
50,000
0
2005
2006
2007
2008
Source: Mortgage Bankers Association and JPMorgan
2009
2010
2011
2012
35
Estimates of FHA Multifamily Lending
Volume ($millions)
25,000
MBA FHA multifamily
MBA Total FHA
20,000
HUD F47 data multifamily
15,000
10,000
5,000
0
2005
2006
2007
Source: Mortgage Bankers Association and HUD
2008
2009
2010
2011
2012
36
Multifamily Lending Volumes and Loan Size,
by Investor Group
60,000
$25
50,000
$20
40,000
$15
30,000
$10
20,000
$5
10,000
0
$0
Life Cos
Freddie
Mac
$Amount 2012 (millions)
Source: Mortgage Bankers Association
CMBS
Number 2012
FHA
Fannie
Mae
Banks
Average Loan Size 2012 ($millions, right)
37
MBA Estimate of Total Multifamily Mortgage
Originations by Investor Group ($millions)
Bank
Other
CMBS
Life companies
FHA
GSEs
$160,000
$140,000
$120,000
$100,000
$80,000
$60,000
$40,000
$20,000
Source: Mortgage Bankers Association, JP Morgan Securities, ACLI, HMDA
2012
2011
2010
2009
2008
2007
2006
2005
$0
38
Multifamily Originations for GSEs
($Millions)
Total multifamily
Institutional* multifamily
GSEs
Freddie Mac flow
Fannie Mae flow
$160,000
$140,000
$120,000
$100,000
$80,000
$60,000
$40,000
$20,000
$0
2005
2006
2007
2008
2009
2010
2011
2012
(Fannie+Freddie)/Total
18%
19%
23%
46%
59%
45%
40%
40%
(Fannie+Freddie)/Institutional*
27%
27%
29%
62%
85%
63%
57%
57%
H1 2013
48%
* “Institutional” lenders with dedicated multifamily lending programs. Generally excludes smaller and medium sized banks.
Source: Mortgage Bankers Association
39
Other MBA Multifamily Finance
Data
40
Commercial/Multifamily Mortgage Bankers
Originations Index (2001 avg quarter = 100)
CMBS
800
600
400
+44%
200
Thrifts
Banks &
0
800
600
400
+22%
200
Freddie Mac Companies
0
Life
400
300
200
20%
0
400
300
200
-3%
100
Source: Mortgage Bankers Association
2013Q1
2012Q1
2011Q1
2010Q1
2009Q1
2008Q1
2007Q1
2006Q1
2005Q1
2004Q1
2003Q1
0
2002Q1
Fannie Mae &
100
41
Multifamily Mortgage Debt Outstanding
($millions)
$450,000
$400,000
$350,000
$300,000
Agency and GSE portfolios and MBS
Bank and Thrift - adj
Bank and Thrift - unadj.
CMBS, CDO and other ABS issues
State and local government
Life insurance companies
$250,000
$200,000
$150,000
$100,000
$50,000
1990Q1
1991Q1
1992Q1
1993Q1
1994Q1
1995Q1
1996Q1
1997Q1
1998Q1
1999Q1
2000Q1
2001Q1
2002Q1
2003Q1
2004Q1
2005Q1
2006Q1
2007Q1
2008Q1
2009Q1
2010Q1
2011Q1
2012Q1
2013Q1
$0
Source: Mortgage Bankers Association, Quarterly Analysis of Commercial/Multifamily Mortgage Debt Outstanding
42
UPB of Non-Bank Commercial and
Multifamily Mortgages, by Year of Maturity
Multifamily
$250
$250
$250
$200
$200
$200
$200
$150
$150
$150
$150
$100
$100
$100
$100
$50
$50
$50
$50
$0
$0
$0
$0
Fannie, Freddie, FHA, and Ginnie Mae
Life Insurance Companies
CMBS, CDO or other ABS
Credit Companies, Warehouse, and Other
Source: MBA
2009
2010
2011
2012
2013
2014
2015
2016
2017
2018
2019
2020
2021
2022
Later
$250
2009
2010
2011
2012
2013
2014
2015
2016
2017
2018
2019
2020
2021
2022
Later
$Billions
Commercial and Multifamily
Fannie, Freddie, FHA, and Ginnie Mae
Life Insurance Companies
CMBS, CDO or other ABS
Credit Companies, Warehouse, and Other
43
Contact Information & MBA Resources
Jamie Woodwell
Vice President
Commercial Real Estate Research
jwoodwell@mba.org
202-557-2936
Mortgage Bankers Association
1919 M Street NW, 5th Floor
Washington, DC 20036
MBA research page:
www.mba.org/research
Research Institute for Housing America:
http://www.housingamerica.org
MBA Newslink:
http://www.mortgagebankers.org/NewsandMedia/MBANewsLink
44