Yield PRO TV Rate Desk May 29, 2020
May 29, 2020 edition of Yield PRO TV Rate Desk with Michael Thomas. Mortgage markets reawaken and FHA 223(f) moves to the loan of choice for take-out on both market-rate and LIHTC developments.
Rate Desk Notes May 29, 2020
• S&P up 4% for May
• Crude $35.22
• UST yields .65
• 223(f) 2.48%
• 221(d)(4) 3.13%
• Fannie 3.17%
• Freddie 3.20%
• Mortgage markets reawaken
• SF purchase and refi applications spike
• Is MF next?
• 223(f) loans new path for borrowers
• uptick in 223(f) application volume
• Take-out loan of choice for market-rate and LIHTC
11
views
Yield PRO TV Rate Desk June 1, 2020
June 1, 2020 edition of Yield PRO TV Rate Desk with Michael Thomas. Housing is central issue in economic disparity and a mutually beneficial carrot drives more investment dollars.
Rate Desk notes June 1, 2020
• Indices up
• Crude $35.64
• UST yields .66
• 223(f) 2.48%
• 221(d)(4) 3.13%
• Fannie 3.18%
• Freddie 3.20%
• Housing and economic success
• Carrot or stick?
• LIHTC $8 billion per year to develop and rehabilitate affordable housing
• Work-force mezzanine loan
• Program didn’t pencil and was cancelled after 6 months
• Refocus on new carrot
• Housing is central issue to disparity
• Mutually beneficial carrot drives more investment dollars
37
views
Yield PRO TV Rate Desk May 28, 2020
May 28, 2020 edition of Yield PRO TV Rate Desk with Michael Thomas. Housing is health: Impacting the health of our communities with healthy housing.
Rate Desk Notes May 28, 2020
• Indices down
• Crude $33.55
• UST yields .695-.70
• Corporate bond 10-week high (1.469%)
• 223(f) 2.50%
• 221(d)(4) 3.15%
• Fannie 3.17%
• Freddie 3.20%
• Combining hospitals with multifamily
• Housing is health concept
• Correlation of health and location
• Hospitals with land + MF = good combo with or without LIHTC
• Fixed rate pricing equivalent to investment grade AA rating
7
views
Yield PRO TV Rate Desk May 27, 2020
May 27, 2020 edition of Yield PRO TV Rate Desk with Michael Thomas. LIHTC perm take-out low loan constant due to low rates but still over-sourced.
Rate Desk Notes May 27, 2020
• Indices up
• Crude $32.78
• UST yields .69
• 223(f) 2.50%
• 221(d)(4) 3.15%
• Fannie 3.17%
• Freddie 3.20%
• LIHTC perm take-out
• Low loan constant due to low rates
• Zero deferred developer fee and still over-sourced
• Start with 223(f) early
• Match size to your needs
• Credits for closed amenities?
• Value-add differentiators?
14
views
Yield PRO TV Rate Desk May 26, 2020
May 26, 2020 edition of Yield PRO TV Rate Desk with Michael Thomas. Bridge lending ramps up and the new national green building standards. Got Benchmarking?
Rate Desk Notes May 26, 2020
• Indices up
• Crude $33.97
• UST yields .70
• 223(f) 2.50%
• 221(d)(4) 3.15%
• Fannie 3.20%
• Freddie 3.20%
• 50+ bridge loan applications
• Libor floor .25
• 52-week high 2.44
• NGBS necessary for HUD lending
• Benchmark targets
• FHA map guide slated for July
• How will you reopen your properties?
16
views
Yield PRO TV Rate Desk May 22, 2020
May 22, 2020 edition of Yield PRO TV Rate Desk with Michael Thomas. Bridge loans: setting up for success with your business plan, timeline and COVID-19 mitigation.
Rate Desk Notes May 22, 2020
• DOW down, S&P/NASDAQ up
• Crude $33
• UST yields .66
• 223(f) 2.52%
• 221(d)(4) 3.11%
• Fannie 3.20%
• Freddie 3.20%
• Bridge loans:
o Business plan CapEx & line items
o Scope of repair timeline
o Detailed information
o Everything is a concern
o New normal: all COVID-19 mitigation efforts are important
11
views
Yield PRO TV Rate Desk May 20, 2020
May 20, 2020 edition of Yield PRO TV Rate Desk with Michael Thomas. New rules on CRA evaluations and the potential impact on tax credit investors.
Rate Desk Notes May 20, 2020
• Indices up
• Crude $33.52
• UST yields .68
• 223(f) 2.52%
• 221(d)(4) 3.17%
• Fannie 3.20%
• Freddie 3.20%
• Facebook hits an all-time high
• New economy (tech) vs old (brick and mortar)
• OCC passes new rules on CRA evaluations
• Now includes deposit share (internet banks)
• Multiple banking regulators (OCC, FRB, FDIC and CFPB)
• New social impact position which encompasses CRA
• Potential impact on tax credit investors, specifically LIHTC and NM
13
views
Yield PRO TV Rate Desk May 21, 2020
May 21, 2020 edition of Yield PRO TV Rate Desk with Michael Thomas. GSE vs FHA on perm LIHTC take-out and rate lock underwriting risks.
Rate Desk Notes May 21, 2020
• NASDAQ within 5% of all-time high
• Crude $33.98
• UST yields .68
• 223(f) 2.46%
• 221(d)(4) 3.11%
• Fannie 3.20%
• Freddie 3.20%
• LIHTC perm debt
• HUD waived 3 year rule
• FHA loan after 1 month stabilized at DSR and 3 month close
• Freddie TEL interest rate risk vs underwriting risk
• TEL pricing at 3.46% (1.00 above FHA)
• Forward rate lock does not remove risk
• Loan still carries underwriting risk
• Does CARES Act eviction moratorium apply?
• FHA confirmed allowance of ESA before firm commitment
• Tomorrow: Impact of the new CRA proposal on HTC values
How can I find if my property is a HUD assisted or FHA-insured multifamily property covered by CARES Act eviction moratorium?
HUD multifamily assisted properties:
@s/multifamily-properties-assisted
FHA-insured multifamily properties:
@s/hud-insured-multifamily-properties
9
views
Yield PRO TV Rate Desk May 18, 2020
May 18, 2020 edition of Yield PRO TV Rate Desk with Michael Thomas. House passes $200 billion HEROES Act providing $100 billion to rental assistance.
Rate Desk Notes May 18, 2020
• Indices up, session high
• Crude up $32.84
• UST yields .73
• 223(f) 2.51%
• 221(d)(4) 3.16%
• Fannie 3.21%
• Freddie 3.25-3.35%
• House passes $200 billion HEROES Act
• Advocated by NLIHC
• $100 billion to rental assistance
• Up to 24 months of rent payments
• 70% to households under 50% AMI
• (40% for households under 30% AMI)
• 30% serving 80% AMI
16
views
Yield PRO TV Rate Desk May 19, 2020
May 19, 2020 edition of Yield PRO TV Rate Desk with Michael Thomas. Statutory waivers, bridge money and SFR HUD FHA multifamily loans.
Rate Desk Notes May 19, 2020
• Indices down
• Crude $32.36
• UST yields .69
• 223(f) 2.52%
• 221(d)(4) 3.17%
• Fannie 3.20%
• Freddie 3.20%
• East Coast HUD overwhelmed
• Holding off new concept meetings
• HUD statutory waivers up to 315% in high cost markets
• Bridge money available for some acquisition/rehab
• LTC 65-75% and LTV on year 3 value will be 75% and less
• SFR for HUD FHA multifamily loan unavailable (SW region)
• Exception for affordable housing portfolios with SFR
22
views
Yield PRO TV Rate Desk May 15, 2020
May 15, 2020 edition of Yield PRO TV Rate Desk with Michael Thomas. Bond markets, industry valuations, and risk mitigation with debt service reserves.
Rate Desk Notes May 15, 2020
• Indices up
• Crude up $29.71
• UST yields .62
• Thresholds set on MF secondary market securities
• 223(f) 2.50%
• 221(d)(4) 3.15%
• Fannie 3.20%
• Freddie 3.20-3.35%
• Unrated bond market dead (LIHTC, hospitals, infrastructure projects)
• BBB bonds priced 5.25-5.50
• MF industry facing 1-2 year cash flow crunch
• No long-term valuation issues
• LTV are much lower
• DS reserves for risk mitigation
• Upcoming topics:
o Former Goldman Sachs trader on negative interest rates
o LIHTC equity bridges and cash collateralized bonds
o Construction costs senior housing
13
views
Yield PRO TV Rate Desk May 13, 2020
May 13, 2020 edition of Yield PRO TV Rate Desk with Michael Thomas. Market impact forecasted for 12 months and cash mitigates uncertainty
Rate Desk Notes May 13, 2020
• Indices down
• Crude up $25.82
• UST yields .65
• 223(f) 2.55%
• 221(d)(4) 3.20%
• Fannie 3.20%
• Freddie 3.20-3.35%
• Recovery timeline
• NCREIF looking out 12 months
• Impacts are market and location specific rather than class
• HUD acquisition loans offer longer, more flexible sale times
• Cash mitigates uncertainty
16
views
Yield PRO TV Rate Desk May 14, 2020
May 14, 2020 edition of Yield PRO TV Rate Desk with Michael Thomas. Setting up for future development with historic refi potential.
Rate Desk Notes May 14, 2020
• Indices up
• Crude up $27.68
• UST yields .62
• 223(f) 2.50%
• 221(d)(4) 3.15%
• Fannie 3.20%
• Freddie 3.20-3.35%
• Setting up future development
• Land acquisitions going strong
• Long term rates impacted by purchasing
• Economic uncertainty slow MF refis
• Eve of historic boom
• Massive move-outs disqualified
• Compare portfolio with today's rates for huge refi potential
10
views
Yield PRO TV Rate Desk May 12, 2020
May 12, 2020 edition of Yield PRO TV Rate Desk with Michael Thomas. Exploring alternative financing and development options to diversify portfolios.
Rate Desk May 12 notes:
• Indices down
• Crude up $25.26
• UST yields $32 billion 10yr note auction at .70
• UST yields .67
• 223(f) 2.55%
• 221(d)(4) 3.20%
• Fannie 3.20%
• Freddie 3.20-3.35%
• Best next alternative for financing and loan options
• Housing options, development type and loan
• Diversifying portfolios
• Negative interest rates (stay tuned)
16
views
Yield PRO TV Rate Desk May 8, 2020
May 8, 2020 edition of Yield PRO TV Rate Desk with Michael Thomas. May rents exceed expectations and rental housing continues to prove a solid investment.
Rate Desk May 8 notes:
• Indices up
• Crude oil $23.94
• UST yields .66
• Zillow hits record cash balance
• 223(f) 2.50%
• 221(d)(4) 3.15%
• Fannie 3.15%
• Freddie 3.20-3.35%
• Ginnie Mae issued P&I relief
• Over 80% May rents made
• Rental housing solid investment
39
views
Yield PRO TV Rate Desk May 11, 2020
May 11, 2020 edition of Yield PRO TV Rate Desk with Michael Thomas. Expand your repertoire with online conferences and webinars.
Rate Desk May 11 notes:
• S&P 3-day streak
• NASDAQ 6-day streak
• Dow down
• Crude up $24.57
• UST yields .71-.72
• 223(f) 2.50%
• 221(d)(4) 3.15%
• Fannie 3.15-3.20%
• Freddie 3.20-3.35%
• Fannie small-balance Loan 3.69%
• HUD appraisers/market analysts COVID-19 update $1k
• Virtual conferences and webinars:
- Novoco 2020 conference online (July 23)
- Ballard Sparh three new webinars
- CHFA two new webinars
• Expand your repertoire with online conferences and webinars
8
views
Yield PRO TV Rate Desk May 7, 2020
May 7, 2020 edition of Yield PRO TV Rate Desk with Michael Thomas. Getting to a green property by leveraging rebates, local requirements and benchmarking.
Rate Desk May 7 notes:
• S&P and NASDAQ up, DJIA down slightly
• Crude oil $23.39
• UST yields .63
• 223(f) 2.57%
• 221(d)(4) 3.22%
• Fannie 3.15%
• Freddie 3.20-3.35%
• Getting to a green property
• Leverage rebates and incentives
• Local requirements for green financing
• Gather existing information and plans when purchasing
• Benchmarking is key
10
views
Yield PRO TV Rate Desk May 5, 2020
May 5, 2020 edition of Yield PRO TV Rate Desk with Michael Thomas. HUD requirements, a post COVID-19 world and a shift toward rental housing.
Rate Desk May 5, 2020 notes:
• Indices up
• Crude oil $25.28
• UST yields up .66
• 223(f) 2.60%
• 221(d)(4) 3.25%
• Fannie 3.15-3.20%
• Freddie 3.40%
• HUD will require key COVID-19 updates
• New market study/appraisal report not required
• Household growth post COVID-19?
• Analysts predict shift toward rental housing
16
views
Yield PRO TV Rate Desk May 6, 2020
May 6, 2020 edition of Yield PRO TV Rate Desk with Michael Thomas. More rental housing, the shape of recovery and a new economic ride.
Rate Desk May 6 notes:
• Nasdaq two month high
• Crude oil $23.47
• UST yields .71 to .73
• 223(f) 2.60%
• 221(d)(4) 3.25%
• Fannie 3.15%
• Freddie 3.20-3.35%
• Shift to greater rental housing
• Delay SF purchases due to economic uncertainty
• Shape of recovery
• Majority predict U- or V-shaped recovery
• Predicted Q3/Q4 rebound
• Not like Great Recession
• Akin to disaster economic interruptions
• The Shock Wave
13
views
Yield PRO TV Rate Desk May 4, 2020
May 4, 2020 edition of Yield PRO TV Rate Desk with Michael Thomas. What’s happened with HUD loans, stat waivers and working capital requirements.
Rate Desk May 4, 2020 edition
• Indices up
• Crude oil $21.27
• UST yields up .64 bp
• 223(f) 2.60%
• 221(d)(4) 3.25%
• Fannie 3.20%
• Freddie 3.40%
• HUD moving forward with new construction loans
• Approved stat waiver up to 30%
• HUD approved 15-month IOD
• New construction HUD working capital raised to 3%
• Hard cost contingencies remain at 2%
8
views
Yield PRO TV Rate Desk May 1, 2020
May 1, 2020 edition of Yield PRO TV Rate Desk with Michael Thomas. Historic loans, America re-opening and Opportunity Zones picking up.
Rate Desk May 1, 2020
• Indices are down
• Crude oil $19.18
• UST yields up .64 bp
• 223(f) 2.60%
• 221(d)(4) 3.25%
• Fannie 3.20%
• Freddie 3.40%
• W&D closes historical loan: $2.4 billion
• Follow the leader
• America re-opening
• Opportunity Zones picking up
• Over $10B in equity raised
• Leverage VR to make your apartment bigger
12
views
Yield PRO TV Rate Desk April 29, 2020
April 29, 2020 edition of Yield PRO TV Rate Desk with Michael Thomas. Now is the time for action, work with your lender and keep the flow of credit strong.
Rate desk notes:
• Low rates alone can’t elevate economy
• Indices are up
• UST yields down .62 bp
• 223(f) 2.55%
• 221(d)(4) 3.20%
• Fannie 3.19%
• Freddie 3.40%
• Time for action
• Communicate with your lender
• Flow of credit is essential
• Bridge lending is active
• Value-add still possible in high rent growth submarkets
PRO TAKE AWAYS:
• Communicate with lenders
• Flow of credit essential
• Keep buying and selling
10
views
Yield PRO TV Rate Desk April 30, 2020
April 30, 2020 edition of Yield PRO TV Rate Desk with Michael Thomas. Value-add opportunities in emerging markets and higher value on improving rents with HUD.
Rate Desk April 30 edition:
• Indices down
• UST yields .64 bp
• 223(f) 2.60%
• 221(d)(4) 3.25%
• Fannie 3.20%
• Freddie 3.40%
• Value-add alive
• Opportunities in emerging markets
• Get higher value on improving rents with HUD
• Affordable housing demand
PRO TAKEAWAYS:
• Value add investment
• Affordable housing opportunities
19
views
Yield PRO TV Rate Desk April 28, 2020
Rate Desk April 28 edition:
• S&P, Dow up, NASDAQ down
• Crude oil $12.68
• UST yields down .61 bp
• 223(f) 2.65%
• 221(d)(4) 3.30%
• Fannie 3.20%
• Freddie 3.50%
• Adapting to new environment
• Strong fundamental business plan
• What don’t I know?
• Select financing that compliments your business plan
11
views
Yield PRO TV Rate Desk April 24, 2020
Rate Desk Notes: April 24, 2020
• Indices are up
• Crude oil back up to $17 a barrel
• UST closing the week .60 bp
• 223(f) 2.65%
• 221(d)(4) 3.30%
• Fannie 3.20%
• Freddie 3.50%
• Federal Reserve has deployed $6.6 trillion
• HUD waived 3-year rule for construction loans
• Lock in permanent financing with FHA or GSE
• 2019 funds Federal LIHTC at .93 on the $1
• Encourage smaller investors to get in 2020 funds
20
views