An Examination of Mortgage Debt Characteristics and Financial Risk among Multifamily Properties

Determinants of operating costs of multifamily rental housing

“…The POMS questions on operating costs are particularly suspect on these grounds. Bradley et al (2001) found that operating costs per unit were higher for bigger properties in the POMS sample in bivariate tabulations, but noted the high incidence of nonresponse to the cost questions and focused their analysis on other topics. In another POMS-based study, Bogdon and Ling (1998) found evidence that newer properties had an independent negative effect on operating expenses and that low income residents were associated with above-average expenses, but again missing data limit the confidence that the authors place in their findings.…”

The Effect of Sustainability Features on Mortgage Default Prediction and Risk in Multifamily Rental Housing

“…In a modeling context, if the financial benefits of sustainability were not completely reflected in the original DSCR and LTV, then adding information on sustainability features to a default prediction model could significantly improve the accuracy of that model. Put another way, if sustainability features help buffer properties from losing cash flow and value in the face of energy shocks, recessions, competition, or other events that can push cash flow and value into the default ''danger zone'' (Bradley, Cutts, and Follain, 2001), then knowing that a property is more or less sustainable should help lenders mitigate default risk.…”