Love of Multifamily Lending Lingers, But for How Long? via American Banker Article

Multifamily lending has been the darling of banks and investors for the past few years due partly to easy financing from Fannie Mae and Freddie Mac and the housing bust that has forced more families to rent rather than own.

But bankers and investors are raising renewed concerns that fierce competition for deals, a run-up in apartment prices, and an expected jump in interest rates in the years ahead could spell bad news for banks that hold multifamily loans on their balance sheets. Others are questioning the role of the government in providing cheap financing to large investors while financing for small affordable rental housing has declined.

At a multifamily conference in San Diego this week, debate raged over whether a jump in new construction and increased demand for apartments are laying the groundwork for a multifamily housing bubble. Some of the comments sounded astonishingly like those made by bankers before the housing bust.

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