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The Fed Reserve lowered its benchmark interest rate for the first time since 2008.  President Trump followed with an announcement that he would impose additional tariffs on Chinese goods.  The markets reacted swiftly.  The Dow Jones promptly fell more than 300 points and closed down 1% for today.  The yield on the U.S. 10-Yr fell 20 basis points to 1.85%, closing at its lowest level since November 2016. Concerns over weaker economic growth fueled by the U.S.-China trade war persist.

The latest developments in the markets is a positive for real estate investors who can capitalize on the lowest interest rate levels seen since Q4 2016. 

Today’s improved pricing:

• 35-year fixed FHA insured loans: 3.10%-3.35%
• 40-year fixed FHA construction/perm loans: 3.60%-3.85% 

These pricing indications are current as of the date posted, subject to market interest rate volatility.  Pricing of FHA insured apartment and healthcare loans may be dependent on loan size and other risk factors.  Call for more information.

Few expected the 10-Year Treasury to fall to 2.00% this year.  But that’s exactly where we find ourselves today, driven in part by a combination of lower than expected inflation and weaker economic growth fueled by the U.S.-China trade war. For real estate investors, though, this is a great opportunity to capitalize on some of the lowest interest rates we’ve seen since Q4 2016.

Today’s pricing:

• 35-year fixed FHA insured loans: 3.25%-3.50%
• 40-year fixed FHA construction/perm loans: 3.90%-4.15%

These pricing indications are current as of the date posted, subject to market interest rate volatility.  Pricing of FHA insured apartment and healthcare loans may be dependent on loan size and other risk factors.  Call for more information.

Adroc Capital’s Founder and CEO, Avi Brum, was the keynote speaker in the latest session of The Riverside Experience’s Real Estate Growth & Analysis program in Brooklyn, NY.  The program provides aspiring real estate professionals with access to industry leaders in the real estate investment and finance space.  Topics covered during the session include how lenders underwrite multifamily loans, understanding the loan terms, plant and environmental considerations, how to approach a lender when seeking financing, and the benefits of using a broker versus going direct to a lender.

Feedback from the working group was highly positive. Be on the look-out for our next presentations.  For more information, please feel free to give us a call.  

U.S. Department of Housing & Urban Development (HUD) wants to finance more qualified opportunity zone (QOZ) projects.

Real estate investors in QOZ’s already stand to benefit from the capital gains tax deferrals permitted under the Tax Cuts and Job Act of 2017.   With its latest Notice, HUD further sweetens the deal.

For FHA insured loan applications for projects located in QOZ’s, FHA application fees are reduced.   More importantly, HUD will assign its best and brightest to process such applications, all to improve the execution and expedite loan processing.

HUD’s Section 221(d)4 loan is already one of best new construction/sub-rehab loans available in the market with up to 90% loan-to-cost financing.  However, one of the major drawbacks with HUD insured financing has been its longer processing times.  Given the signal from HUD, we expect HUD to prioritize QOZ project loan applications and significantly improve on its processing timelines.

Give us a call for more information on these benefits or how HUD financing can benefit your real estate investment.

U.S. Department of Housing & Urban Development (HUD) has issued a Section 202 Notice of Funding Availability (NOFA) for the first time since 2010. 

 Section 202 provides funding for the development and operation of supportive rental housing for income-qualified persons 62 years of age or older.  Under the program, eligible non-profit Sponsors can receive Capital Advance funds for the acquisition, construction, or rehabilitation of qualified senior housing projects along with a Project Rental Assistance Contract (“PRAC”) which provides rental subsidies for very-low income persons. 

 HUD is targeting projects that are at the forefront of design and service delivery and that will serve as a model for supportive housing providers within the industry. Accordingly, applicants need to demonstrate best practices and innovation in both physical design and supportive services. Proposals should promote the long-term physical and mental health and wellness of income-qualified elderly persons and the efficient use of government assistance. 

HUD has budget authority to award up to a total of $110 million.  Up to $50 million is available in this NOFA.  The remaining funds will be available in a second NOFA which HUD expects to publish in 2020.  The application due date is August 28, 2019.  Applicants are instructed to download the Application Package from Grants.gov and submit the application electronically. 

For more information, please feel free to give us a call.