by Bill McBride on 8/13/2007 02:21:00 PM
Monday, August 13, 2007
Commercial Real Estate LendingClick on graph for larger image.
Lending standards for commercial real estate loans were reportedly tightened further over the past three months: About one-fourth of domestic institutions—a slightly smaller net fraction than in the previous survey—and about 40 percent of foreign institutions indicated that they had tightened lending standards on commercial real estate loans in the July survey. Regarding demand, approximately one-fourth of domestic and foreign institutions reported that demand for commercial real estate loans had weakened over the past three months.
Graph added. This graph shows loan demand for CRE, as reported in the Fed's Senior Loan Officer survey, and year-over-year investment in non-residential structures from the GDP report.
This suggests that CRE investment will probably slow in the coming year.
Update: The loan survey showed tightening standards and falling demand in most categories: Commercial & Industrial loans (C&I), commercial real estate loans (CRE), household mortgages including prime loans, and other consumer loans. The one exception was for credit card loans with slightly looser standards.
Posted by Bill McBride on 8/13/2007 02:21:00 PM