NEW LENDING FOR REAL ESTATE EXPECTED TO INCREASE IN FISCAL 2019, BUT CAUTIOUS AND BALANCED APPROACH SET TO CONTINUE

 

  • Real estate non-recourse loans: New lending expected to increase in fiscal 2019
  • Lenders believe the biggest threat is "domestic and global economic shock". The impact of U.S-China trade friction is the main cause for concern.
  • Lenders are nevertheless slightly more positive compared with the 2018 survey. A greater number of respondents expect real estate prices to rise. While respondents anticipated that LTV ratios would be unchanged from the previous year, their opinion on spreads was divided, with more lenders than last year expecting spreads to contract.
  • Amid a continued low interest rate environment, real estate investments that offer the promise of higher income are key targets for lenders. The survey suggests that while lenders’ attitude to lending remains positive, they continue to be cautious and balanced.