Dodd-Frank continues to smother mortgage lending | 2015-06-09 | HousingWire
[{"id": "cs1bk5q", "text": "Whether or not I agree, what does this have to do with CRE?", "replies": [{"id": "cs1va2y", "text": "From a multifamily CRE perspective, everything.  Since renters chances of becoming homeowners is decreasing, renter occupancy levels are skyrocketing and, it would seem, will stay that way for some time", "replies": [], "depth": 2}], "depth": 1}, {"id": "cs2dmcb", "text": "&gt; The 182 respondents, 77% with assets less than $1 billion, reported the highest percentage of loans to first-time homebuyers in the survey\u2019s 22 year history.\n\nthat doesn't really sound that bad", "replies": [{"id": "cs2fmp6", "text": "Sure doesn't although I'm looking more toward Aug 1 this year when Dodd-Frank really comes home to roost, but even then industry is pushing for a 6-month implementation grace period before the ATR provisions are fully enacted.  So won't see true impacts until sometime next year but we'll have a much better idea of the impacts come Oct/Nov this year.  ", "replies": [{"id": "cs2ggke", "text": "maybe slightly off topic but how do you think this stuff plays into multi caps?  Do you think this is a minor issues or its being priced in and relied upon to keep more renters around?\n\nI don't really have a very optimistic outlook for multi atm just due to the caps and the almost certain future rate hikes.  I think a correction is probably going to hit there harder than anywhere else in the next maybe 5 years.  \n\n", "replies": [{"id": "cs339id", "text": "I was actually talking about this with an asset manager a couple days ago.  Fundamentally, MF assets are performing better than they ever have and, across almost all metros, there is still nowhere near enough supply to handle the explosion in the ranks of renters.  You're seeing some overheating in the A/A+ categories, particularly in the Phoenix Metro where developers/underwriters are using $2+/sf rents as a means test for DS payments and since we're only now beginning to see the bulk of these new product deliveries we will now see, truly, how much appetite there is for this upper range product.  \n\nOne potential issue which could see the pendulum swing to the SFR side - aside from raising interest rates/EU breakup/dollar loosing its reserve currency status (note China/Russia recently stopped using dollars in petro transactions) affecting more macro-economics which also impact SFR as well to varying degrees - is the death of the baby boomer generation and the transfer of wealth to their children.  Some trillion+ is expected to be transferred to their children over the next 20+ years or so and it remains to be seen what people will do with their inheritances.\n\nAs far as a correction in values, as interest rates continue their rise (just officially crested 4%), corresponding values will certainly decrease.  I'm seeing anecdotal evidence this is already occurring simply by looking at list price v sales price.  Nonetheless I'm still fairly bullish on the C/B product which, in the Phoenix Metro, could still see raises in rents of 5-10% and still be priced less per SF than most A- type product", "replies": [], "depth": 4}], "depth": 3}], "depth": 2}], "depth": 1}]