CoStar Group reported that Commercial Mortgage Backed Securities (CMBS) may be back in business. CMBS was similar to the residential secondary mortgage markets. Loans were group together and sold to investors and this was a large part of what drove the housing boom from 2000-2007 but this is also large part of the recession of 2007 to now.
I’m over-simplifying but if there’s no investors to buy the loans, banks will be less likely to make the loans, as investors come back to buying mortgages, banks will make more loans and more property sales will take place! CMBS is good for the future of commercial real estate!
Read the full article here: Investors Showing an Appetite for Bonds Backed Even by the Weakest Real Estate Sector and No Government Support
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