4min chapter

Money For the Rest of Us cover image

How the Coming Credit Crunch Could Harm the Economy and Real Estate Prices

Money For the Rest of Us

CHAPTER

The Impact of Banks Pulling Back Their Lending

Interest rates have gone from close to zero to approaching 5% in just over a year. Bank boards are going to have to discuss whether it still makes sense to be an independent company. Banks provide 58% of commercial mortgage loans and 32% of loans on multi-family housing. If banks are being stingier in terms of their willingness to lend, that could put downward pressure on real estate values.

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