In two separate research reports released this week, the Mortgage Bankers Association (MBA) paints a sobering picture of the recent past and immediate future.

In the fourth quarter of 2008, multifamily loans saw a 62 percent decrease compared with the fourth quarter of 2007, to a level not seen since the opening months of 2004. In fact, multifamily lending volumes were down by 33 percent when compared to the third quarter of 2008.

Among investor types, commercial mortgage-backed securities (CMBS) led the way, down 98 percent from the last quarter of 2007. But Fannie Mae and Freddie Mac saw a 15 percent decrease in their dollar volumes in the fourth quarter when compared to the fourth quarter of 2007. The government-sponsored enterprises also saw a 21 percent drop in loan volume compared to the third quarter of 2008.

“Between the worsening economy and the continued credit crunch, lenders are extremely cautious about lending, and borrowers are likely to hold onto the assets and the loans they already have,” says Jamie Woodwell, the MBA’s vice president of commercial real estate research.

The MBA also released its Survey of Loan Maturity Volumes, offering a glimpse of the coming wave of nonbank loans reaching maturity in the next year. According to the MBA’s report, $171 billion of commercial/multifamily loans will mature in 2009, and another $120 billion will mature in 2010.

But the volume of maturing loans differs considerably by investor and loan type. Short-term, floating-rate CMBS mortgages are more likely to mature in 2009 and 2010 than are fixed-rate CMBS mortgages or loans held or guaranteed by Fannie Mae, Freddie Mac, and the Federal Housing Administration (FHA).

Of the total nonbank loans coming due in 2009, 52.8 percent is in CMBS, CDOs, or other asset-backed securities, compared to just 3.8 percent held or guaranteed by Fannie Mae, Freddie Mac, or the FHA.

Many in the multifamily industry fear that this coming wave of loans in need of refinancing will have a very difficult time finding liquidity. Construction loans with overly liberal terms that need to convert to permanent loans will also have difficulty finding financing.

This is significant because the lack of liquidity may force some owners to sell, adding to an already growing volume of distressed assets—a trend that will likely further undermine apartment values in many markets.