The business property market is no doubt competitive in Massachusetts and other states with major markets. However, investors who want to get their feet wet in real estate may now receive a little help from banks. Banks apparently loosened their commercial real estate lending standards recently, which may make it easier for more people to secure lending in this industry.
Commercial real estate standards have not been loosened for about three years, so the current easing of the standards is welcome among investors. An important lending term that has been eased is how large a loan can be. Another term recently loosened has to do with the spread of lending rates over fund costs.
Investors can take advantage of these lighter lending criteria whether they are pursuing lending for multifamily properties, land development and construction loans, or non-farm nonresidential lending. Meanwhile, it appears that the demand for business lending has weakened. The Fed might not feel good about the change taking place in the commercial market, but at this point, it has not adversely impacted the financial markets.
Commercial real estate is complicated, but it can also be highly lucrative, so for many investors, the risk is worth the reward. Of course, a real estate deal is nothing to take lightly, as large sums of money may be on the line. An attorney in Massachusetts can provide investors with the guidance they need to effectively address the legal aspects of their deals. The attorney’s ultimate goal is to make sure that investors’ rights are protected and that their best interests are upheld in deals both large and small.
Source: marketwatch.com, “U.S. banks loosened commercial real estate lending standards for first time in 3 years: Fed“, Greg Robb, May 8, 2018