Apartment Loan in Houston, Texas:
Since April of 2000 Caffrey & Company LLC has been helping real estate investor’s nationwide find the best loan product for commercial real estate investment properties. Call for great rates for an apartment loan in Houston, Texas. Caffrey & Company LLC has a special focus in Houston, Texas apartment loans. The most attractive, non-recourse loans terms start at $1,000,000 for multifamily properties. Therefore, if you are looking for low interest rates, a non-recourse loan up to 80% of value (Over $7 million leverage up to 85% is available) you are at the right place. These specialized apartment loan products are available in all of the suburbs including: Spring, The Woodlands, Humble, Tomball, New Caney, Conroe, Kignwood, Baytown, Pasadena and Sugarland.
Multifamily Loan Underwriting:
Each loan product has unique underwriting requirements. Above all, how the loan data is presented to the lenders can have a negative or positive impact on pricing and loan proceeds. We offer this expert loan underwriting for an apartment building loans in Houston, Texas. Therefore, this will help to achieve the best pricing and loan terms for your commercial real estate investment.
Free Loan Quote:
We encourage our clients to submit key property level data for a free loan underwriting review. This initial loan underwriting normally takes less than one business day for us to respond with several apartment loan options for you to consider. Here is a short list of property level data that would aid in providing a loan quote:
Required Underwriting information needed:
- Last two years and Year-To-Date detailed Profit and Loss statements (in addition a trailing 12-month P&L is best if available) on the apartment complex.
- Current Rent Roll
- Brief narrative description of the property.
- If available a few electronic photos. Or a copy of the real estate agent’s marketing package.
- What is the purpose of the loan? Acquisition, Refinance, cash out, re-position the property (renovations).
Next we will need to understand your investment objectives. How much do you wish to borrower on the apartment complex? Is this a long-term investment or short-term investment? In other words outline your apartment loan in Houston, Texas loan request.
We understand the financing of an apartment complex is a very important component of your investment. Therefore, we encourage our client to send us details on the property before finalizing the purchase and sale contract for an indication of the type of loan that might be available to a particular property. We can review and provide some up front loan options.
Fixed Rate Loan Terms are Available for Multifamily Properties:
Loan terms are available from 3-years up to 35-years (40-years for new construction on loans over $7 million). The Apartment buildings can be Garden Style, High Rise, Age Restricted, Student Housing, Section 8 Tenants and subsidize properties. There must be at least 5-units. If you have several buildings all with five or more apartment units that you wish to place under one loan no problem, the buildings should be within 3 to 5-miles from the other properties for best loan terms.
How long will it take to close the Loan?
The closing process normally takes between 45 and 55 days to close an apartment building loan in Houston, Texas. Closing costs vary between loan products. Before you reach for your checkbook we will provide a detailed estimate of the anticipated closing costs. At this stage you will know the loan product, the loan terms, and the anticipated closing costs to allow you to make an informed decision before moving forward.
Houston Multifamily Market:
The recent multifamily construction wave peaked in 2020 as Greater Houston apartment operators coped with the effects of the pandemic by raising concessions to attract renters. Builders brought nearly 23,300 units online in the last four quarters, reaching a cycle high. While development was spread throughout the metro, a significant share came online in the Katy/Cinco Ranch/Waterside submarket with 3,800 units. The additions facilitated leasing activity in the area, where rental demand remained positive all year. Even with rent higher than the metro average, the submarket remained attractive to renters as development along Interstate 10 and the Grand Parkway created employment opportunities and community amenities. Sustained inventory growth is expected in the submarket this year, with more than 2,000 units scheduled to come online. Apartment absorption in the submarket is projected to remain positive, though trail inventory growth over the next four quarters. The submarket trend should mirror the metrowide forecast, as positive annual leasing activity is expected to trail the nearly 16,700 additions in 2021. Contributing to the slowdown in absorption is the predicted slower recovery of blue-collar jobs this year. Conversely, employment in most white-collar industries is anticipated to exceed pre-pandemic levels by the end of 2021. These positions will support demand for Class A, amenity-rich apartments in Greater Houston. Positive movement in the workforce is expected to carry over to 2022 as apartment
demand surpasses inventory growth. As a result, apartment fundaments are projected to improve, as occupancy is forecast to reach 87.8% by year-end 2022 and monthly effective rent reaches $1,065.
Houston Multifamily Forecast:
Energy Corridor fundamentals softened. Low per barrel oil prices and sluggish demand amid less travel is weighing on Houston’s energy sector. The office vacancy rate in the Energy Corridor area increased 270 basis points from April through September to 22.8 percent. The Class B/C rate here jumped 480 basis points, compared with a 130-basis-point rise for Class A, potentially revealing that smaller companies are struggling. Thousands lost jobs within the industry, and many firms face challenges in replenishing workforces, stunting short-term rental demand. During the second and third quarters, apartment vacancy in the Energy Corridor area rose 160 basis points as the average effective rent fell more than 6 percent.
Unemployment due to the Pandemic Hit Houston Hard:
Labor force replenished jobs quickly, though a widespread disruption persists. Houston had an unemployment rate of 3.8 percent entering this year until 365,000 jobs were lost in March and April. The cuts pushed the unemployment rate up to 14.7 percent, which matched the national rate. In the months following, the local jobs recovery outpaced the United States, largely due to the state’s accelerated reopening. In August the unemployment rate was back down to 7.9 percent after the return of 123,000 roles during the summer. Nevertheless, an uncertain path forward for the tourism and oil industries casts doubt on the metro’s ability to sustain momentum. This began to show moving into the latter stages of the year, with the unemployment rate bouncing back up near 10 percent in September. Four of the metro’s 10 largest employment sectors are down at least 10 percent from the payroll levels entering this year.
Hard Recovery for some sectors:
Retailers in vacation destinations face a tough comeback. Travel came to an abrupt halt in the typically busy spring and summer season, and many people are still avoiding air travel. The outlook for shops that rely on tourist spending by out-of-state visitors remains cloudy, particularly for retailers in the Southeast submarket, which encompasses Space Center Houston, Galveston Island and the Bolivar Peninsula. Vacancy in the submarket rose 40 basis points in the third quarter as stores began to vacate space at a faster pace than the market as a whole. Additionally, recently announced closures may have yet to manifest in terminated leases, and availability could continue to rise in the coming quarters.
Northside of Houston Strongest Market:
Northern Houston suburbs are the primary target for buyers. In the second quarter deal flow fell sharply, though more trades occurred in the following period as conditions materialized and financing became increasingly accessible. Montgomery County cities such as Conroe and The Woodlands have drawn favor from retail and multifamily investors. Demand for shopping and rental housing in these suburbs could strengthen as the health crisis and remote working shift renter and employer preferences. Office and industrial investors also frequently searched north of Houston, outside the Sam Houston Tollway in the corridor between Interstate 45 and Highway 290. Offices in this area could lure firms relocating from the urban core as well as more distressed coastal markets. Warehouses and distribution facilities here, meanwhile, may prove valuable due to the proximity to thoroughfares and rapidly growing suburbs.
In conclusion you find details on several loan products by following these links: Freddie Mac, Fannie Mae, HUD/FHA, Commercial Mortgage Back Securities (CMBS) and other loan products. Want more details and sample interest rates for apartment check out Interest Rates for Apartment Loans also on our web site: Multifamily Loan Interest Rates.
Keep Caffrey & Company in mind when searching for a Texas lender for apartment loans. Have a question please call: Mike Caffrey (913) 402-7077 or email: Mike@CaffreyLoans.com
On our web site you can read about specific loan products: www.caffreyloans.com/loan-products, offered by Freddie Mac, Fannie Mae, HUD/FHA, Commercial Mortgage Back Securities (CMBS) and other loan products. Want more details on sample interest rates for apartment check out Interest Rates for Apartment Loans also on our web site: www.caffreyloans.com/apartment-loans.