Virginia Apartment Loans
|Virginia Apartment Loan Programs Over $6,000,000||Rates (start as low as)||LTV|
|Multifamily 5 Year Fixed Loan Rates||2.79%||Up to 80%||Get Free Quote|
|Multifamily 7 Year Fixed Loan Rates||2.87%||Up to 80%||Get Free Quote|
|Multifamily 10 Year Fixed Loan Rates||2.99%||Up to 80%||Get Free Quote|
|Virginia Apartment Loan Programs Under $6,000,000||Rates (start as low as)||LTV|
|Multifamily 5 Year Fixed Loan Rates||3.33%||Up to 80%||Get Free Quote|
|Multifamily 7 Year Fixed Loan Rates||3.34%||Up to 80%||Get Free Quote|
|Multifamily 10 Year Fixed Loan Rates||3.35%||Up to 80%||Get Free Quote|
Select Commercial has excellent apartment building loan and multifamily loan products and options available for owners and purchasers of multi-family and apartment properties throughout the state of Virginia. Whether you are looking to finance a small apartment building, a complex with hundreds of units, or a co-operative, we can help you find the optimal financing solution to meet your apartment mortgage loan needs. While we lend across the entire continental US, we are able to give our best rates and loan programs to certain areas that we feel are strong markets. Virginia is one of the states that we consider to be a premium market for apartment building loans and we actively look to originate good quality loans here for our clients. We have a diverse array of many available loan products to help qualified VA borrowers looking to purchase or refinance an apartment property. We offer apartment loans with terms and amortizations up to 30 years, recourse and non-recourse, and many options for prepayment. We typically approve apartment building loans within 1 day and usually close within 45 days of application. Our clients love our simplified application process, 24-hour pre-approvals with no-cost and no-obligation, great rates and terms, fast closings and personalized service. For more information on multifamily loans, check out how to get the best rate on a multifamily loan and how to get the best rates on an apartment refinance.
Virginia Apartment Loan Benefits
Virginia Apartment Loan rates start as low as 2.79% (as of January 25th, 2022)
• A commercial mortgage broker with over 30 years of lending experience
• No upfront application or processing fees
• Simplified application process
• Up to 80% LTV on apartment financing
• Terms and amortizations up to 30 years
• Loans for purchase and refinance, including cash-out
• 24 hour written pre-approvals with no cost and no obligation
Recent TRUSTPILOT Reviews
Select Commercial Funding Reviews from TRUSTPILOT
A three year journey
"Thanks Stephen for all of your hard work in getting our deal closed! I appreciate your professionalism and patience throughout a complicated process. You always were there for my partner and I whenever we had questions and needed answers quick. It was a pleasure to have worked with you and Select Commercial!"
Virginia Apartment Loan Types We Serve
If you are looking to purchase or refinance a Virginia apartment building, don't hesitate to contact us. We arrange financing in the state of Virginia for the following:
- Large urban high-rise apartment buildings
- Suburban garden apartment complexes
- Small apartment buildings containing 5+ units
- Underlying cooperative apartment building loans
- Portfolios of small apartment properties and/or single-family rental properties
- Other multi-family and mixed-use properties
2021 Multifamily Outlook
The COVID-19 pandemic affected the ability of young graduates to find jobs and move into apartments of their own. The demand for apartment rentals is usually fueled by young graduates entering the workforce and moving into rental apartments. Many young adults lived with their parents or friends during the pandemic and into early 2021. As 2021 progressed, many companies reopened their offices and began hiring again which generated record levels of new apartment rentals. This trend should continue through late 2021 as more new workers are able find jobs and move into their own apartments. Many of these new multifamily units are in metro areas of the sunbelt states as workers have been moving out of colder urban areas in favor of more suburban warmer climates.
The tight market in 2021 for new home purchases has caused many would be homebuyers to continue renting. Prices for existing homes have risen due to lack of inventory and the cost of construction has skyrocketed due to increased costs for raw materials. The high cost of purchasing a new or existing home is keeping the demand for rental units very strong in 2021.
During the pandemic, when workers were either out of work or working from home, many people moved out of densely populated urban areas in favor of suburban locations. In 2021, as more employees are returning to their offices, we are seeing demand pick up once again for rental apartments in urban locations. In addition, as more and more retail and dining locations reopen in downtown areas, we expect to see a return of employees to these areas.
During the pandemic, the CDC and local governments instituted a moratorium of evictions. This caused many landlords to suffer economic losses and depressed the value of apartment properties. In 2021, as these moratoriums start to expire, we expect to see strong demand from investors for these properties.
Nationwide, the first half of 2021 saw more than 175,000 new apartments completed and a total of 363,000 for the previous 12 months. A high percentage of these new units were in Texas and other sunbelt states, as more and more people are relocating to warmer climates. Occupancy rates and asking rents have been lower in larger urban markets in the Northeast and other colder climates, while occupancy rates and asking rents have been increasing in these warmer sunbelt climates. These 2021 trends have definitely been driven by the COVID-19 pandemic and we are watching these trends closely to see if these trends persist after the pandemic is over. Check out our low commercial real estate loan rates and use our commercial mortgage calculator to calculate monthly principal and interest.
Apartment Loan Trends in 2020
At the start of 2020 the market outlook did not indicate any significant factors that would cause major trouble in the multifamily market. Market indicators suggested that demand for housing, especially for apartment rentals, would remain healthy, thus continuing to generate new construction of multifamily buildings. Both the high number of permits and starts over the past couple of years led experts to believe that developer confidence is very high in the multifamily market. Market experts predicted an annual completion of 340,000 apartment units over 2020, way above the 300,000-annual average for the past five years. Over the last couple of years, the multifamily market has seen absorptions outperform expectations due to both changes in lifestyle and demographic preferences and new supply has consistently taken longer to be built. These two factors have helped the market to perform stronger than expected in the past and should continue throughout this year. Market data indicated that rent growth would remain strong in 2020, growing 3.6% (which is above the historical average). In terms of mortgage origination, low interest rates and strong multifamily performance were expected to help loan volumes grow. Experts predicted that the origination volume in 2020 will increase by 5.7% to $390 billion. Market data indicated that cap rates have more room to decline, which would lead to increasing property values and should drive up origination volume. However, with the current outbreak of Covid-19, the overall economy has been in flux. The stock market has crashed and commercial mortgage interest rates have been severely impacted. Huge metros such as New York have all but shut down much economic activity and entertainment. In this unsteady climate, many investors are scared to purchase commercial real estate and to take out commercial mortgages and apartment loans. Additionally, the oil industry has taken a big hit. Not only are people traveling less due to the pandemic, foreign countries like China and Russia are involved in a huge price war which is driving the price of oil way down. Experts are hopeful that as the weather warms up and public health policy learns how to handle this pandemic, the economy should revert back to its pre-virus strength.
Virginia Apartment Loan Options
Our company has multiple capital sources for these apartment loans, including: Fannie Mae, Freddie Mac, FHA, national banks, regional and local banks, insurance companies, Wall Street conduit lenders, credit unions and private lenders.
Fannie Mae’s multifamily loan platform is one the leading sources of capital for apartment building loans in the US. Fannie Mae is a leader in the secondary market – meaning they purchase qualifying apartment loans from leading lenders who originate these loans for their borrowers. Fannie Mae purchases loans secured by conventional apartments, affordable housing properties, underlying cooperative apartment loans, senior housing, student housing, manufactured housing communities and mobile home parks on a nationwide basis. The Fannie Mae platform has many benefits, including:
- Long term fixed rates and amortizations. Fannie Mae allows terms and amortizations of up to 30 years. Most banks offer only 5 or 10 year fixed rates and 25 year amortizations.
- Non-recourse options. Most banks will require the borrower to sign personally for the loan. Fannie Mae offers non-recourse apartment loans.
- Lending in smaller markets. Many national lenders do not like to lend in rural or tertiary markets. Fannie Mae is a good option for these loans.
- Assumability and Supplemental Financing. Fannie Mae allows their loans to be assumed by a qualified borrower. They also have a program which allows borrowers the ability to come back and borrow additional funds during the life of the loan (subordinate financing).
Freddie Mac Multifamily Loans provide mortgage capital in the secondary market for apartment building loans. Together, Fannie Mae and Freddie Mac control a very large portion of the multifamily market. Freddie Mac has a very aggressive program for small balance loans (from $1,000,000 to $7,500,000). Some features of this program include:
- Market size driven. Freddie Mac classifies loans by the size of the overall market: Top, Standard, Small, and Very Small. Rates are best in top market locations (major metropolitan areas).
- Capped costs. Freddie Mac lenders often cap the closing costs at a fixed dollar amount, thereby lowering the overall cost to borrow money.
- Flexible pre-pay penalties. Freddie Mac offers many options for pre-payment penalties, from yield maintenance to step-down to “soft” step-down.
- Interest-Only (I/O) loans. Freddie Mac will allow payments consisting of only interest and no amortization of principal.
- Fixed rate terms. Freddie Mac offers fixed rates of 5, 7, and 10 years, followed by an adjustable period. These loans are called Hybrid/Adjustables. Loans have a 20 year term and a 30 year amortization schedule.
Virginia Apartment Lending with Banks and Other Programs
While the agencies (Fannie Mae and Freddie Mac) offer some excellent programs, not every apartment loan applicant qualifies for these programs. We have many excellent choices for these loans with our correspondent banks, credit unions, insurance companies and private lenders. Some examples of these loans include:
- Loans that require flexible underwriting or those that don’t meet standardized criteria.
- Properties in less than desirable markets, or those that require repairs or updating.
- Properties that don’t cash flow according to industry guidelines or lack stabilized cash flow.
- Borrowers with past credit issues, including foreclosures, short sales, or judgements.
- Borrowers who are not US citizens.
Whether you are purchasing or refinancing, we have the right solutions available for your multifamily mortgage loans. We will entertain loan requests of all sizes, beginning at $1,000,000. Get started with a Free Commercial Mortgage Loan Quote.
Virginia Multifamily Loan Information and Economic Overview
Investors looking for a potential big return on their money would benefit by looking into procuring commercial mortgage financing in Virginia. The average value of commercial real estate properties in the state of Virginia is about $785,000 with a median sale prices of above $271,000. Over the last two years there have been about 53,000 commercial sales; slightly more than 28,000 of them have sold for greater than $250,000, about 6,300 sales valued at over $1,000,000, and 1,000 sales were appraised at over $10,000,000. The average price per square foot of commercial real estate properties in the state is $13 while the average lot size of Virginia is 38,930 square feet (45% above the United States average). There are about 901,000 commercial real estate properties in Virginia, 193% below the country’s average, with a total acreage of about 7.5 million acres. In terms of commercial mortgage financing, there are about 443,000 mortgages for commercial real estate properties throughout the state of Virginia. The average value of these commercial mortgages is about $6 million, 14% above the United States average.
The Richmond multifamily market seems very strong in 2019 and looks like a great place for investors to look into receiving an apartment loan. Although employment gains in Richmond–Tidewater started to decline in the middle of last year, the multifamily market was not really negatively impacted. Rents outperformed the national average, increasing 3.4 percent year-over-year as of March and occupancy in stabilized properties actually inched up 10 basis points, to 95 percent, over 12 months. While the market is still growing productively, with 4,315 new multifamily units underway as of March and 2,520, supply is bound to partially diminish rent growth. The average Richmond rent is estimated to advance 2.3 percent this year. Similar to the recent increase of multifamily complexes being built in Richmond, Chesterfield is having a boom of its own. A bunch of new multifamily developments are under construction and in planning. Many of these new complexes are gathered on the western end of the county and are part of or next to larger mixed-use buildings. The Richmond Times-Dispatch has reported that a two-level penthouse at The Jane at Moore’s Lake apartments in Chesterfield County has been leased for more than $3,000 a month. This apartment complex is located in Chester which is just south of Richmond. Those looking to invest in this lucrative market should most certainly look into procuring an apartment loan to help make a purchase.
In Northern Virginia, there are an influx of investors looking for commercial mortgage loans in order to break into the market. Property listings that had been sitting on the market with little interest are suddenly being fought over by multiple buyers. Much of this buzz has been caused by west coast tech companies such as Amazon and Apple, who both announced that they are in the process of setting up east coast headquarters in Virginia. These developments will significantly increase the number of jobs, as 50,000 new high paying jobs are estimated to be added over in the next few years. It has already been announced that Amazon HQ2 will be coming to Crystal City. With this new increase in demand for both housing and commercial space, prices are anticipated to rise steeply this year. The day that Amazon announced HQ2 two luxurious condo listings immediately increased their list price by 30 thousand dollars. In fact, with this anticipation of much higher demand in the area many experts think that we might see record breaking price increases in 2019 in Virginia commercial real estate. Thus, smart investors may find Northern Virginia a terrific place to look into commercial mortgage financing and apartment loans.