NEW YORK (Reuters) - The amount of U.S. mortgages on multifamily homes outstanding rose by $20.6 billion, or 2.1 percent, in the first quarter from the previous quarter on strong demand for apartments, Mortgage Bankers Association (MBA) data released on Tuesday showed.
The increase in multifamily mortgages accounted for about one-half of the overall $40.4 billion rise in commercial real estate loans outstanding in the first quarter.
“Multifamily mortgages continued to grow even more quickly than the market as a whole,” Jamie Woodwell, vice president of commercial real estate research at the Washington-based industry group said in a statement.
Commercial mortgages outstanding grew to $2.681 trillion at the end of the first quarter, with multifamily loans rising to $989.05 billion, MBA data showed.
Data suggested the pace of growth in multifamily loans will likely persist in the second quarter.
The Commerce Department said on Tuesday that builders broke ground on multifamily homes at an annualized pace of 356,000 units, slower than the rate of 446,000 units in April but faster than the 349,000-unit rate a year ago.
Permits to construct apartments rose to an annualized rate of 592,000 units in May, up from 474,000 units in April and 391,000 units a year earlier, the department said.
Reporting by Richard Leong; Editing by Jeffrey Benkoe