The numbers translate to a default rate 0.03%, the lowest rate since the June 30, 2002 survey, which found a default rate of 0.01%. As recent as March 30, 2007, the delinquency ratio was .13%; one year ago the ratio stood at .09%.
Two of the three delinquent loans--for $8.9 million and $4.8 million, respectively--are secured by healthcare properties; the other loan, $12.1 million, is secured by a hospitality property. Due to the confidential nature of the survey, no additional details were available regarding the delinquent loans.
Seventeen income property mortgage bankers participated in the CMBA survey. These companies originate and service loans on apartments, retail, industrial and other commercial properties for institutional investors such as life insurance companies and pension funds.
Earlier this week, RealtyTrac reported 925,986 residential mortgage foreclosure filings nationally during the first half of this year, up more than 55% from the first six months of 2006. Rick Sharga, RealtyTrac's vice president of marketing, told GlobeSt.com that the residential foreclosure picture "will get worse before it gets better," primarily because a large number of risky adjustable loans are coming due this fall.
A Jones Lang LaSalle report this week on the CMBS market states that the "unrelenting flow of negative news" regarding the US housing market and subprime mortgages "has taken its toll on the US commercial mortgage market" in the form of rising spreads. "In contrast to the relative stability of AAA CMBS bond spreads over the last few months, AAA bonds have widened approximately 15 to 20 basis points this week," states the report, which predicts that spreads will widen further before volatility settles down.
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