Bank-held multifamily loan delinquencies eased to 1.41% in Q2 2026, down from a multi-year high of 1.47% in Q1, per CRED iQ’s analysis of FDIC data across all insured institutions. Banks’ total multifamily portfolios grew to $667.6 billion in the quarter, up 3.6% year-over-year though decelerating from Q1’s pace, and the dollar amount of delinquent loans fell too, to $9.41 billion from $9.78 billion. Early-stage delinquencies (30-89 days) dropped to 0.31% from 0.40%, but 90+ day delinquencies ticked up to 1.10% from 1.07%, and net charge-offs rose to an annualized 0.32%, more than double the 0.13% banks charged off for all of 2025. That combination, easing delinquency, rising realized losses, is consistent with a workout-driven cycle rather than a resolving one. Today’s rate is still roughly 6.7 times the 2019 low of 0.21%, though well below the 5.90% Global Financial Crisis peak.
What’s Driving the Losses? A Property-Level View From CRED iQ’s Loan Data
FDIC data shows losses rising but investors need to examine property-level financials to understand the root causes. CRED iQ’s own property-level income and expense data, securitized multifamily loans that reported updated financials in June 2026, fills that gap. At the median property, effective gross income grew just 0.6% while operating expenses grew 1.5%, about 2.5 times as fast. Net operating income grew only 0.2%. That median hides a wide split: 57% of properties saw expenses outpace income, and 48% saw NOI decline outright, close to a coin flip nationally. A property with softening NOI has less cushion to absorb a rate reset or a maturity refinance, a plausible link to the same loans eventually migrating into the 90+ day bucket, or getting resolved through a workout and a realized loss.
The pattern isn’t uniform. Denver, Seattle, and San Francisco show the weakest combination of trends nationally, below-average income growth paired with above-average expense growth, producing the sharpest NOI erosion in the sample. Several Sun Belt metros, including Dallas and Austin, look different: NOI softness there comes from weak income growth rather than rising costs, a demand-side story rather than a cost-side one.
CRED iQ’s property-level dataset reflects securitized multifamily loans, distinct from FDIC’s bank-held universe.
The Bottom Line
Q2 delivered the first genuinely mixed signal in an otherwise steady multifamily credit deterioration: the headline rate improved, but 90+ day delinquencies and charge-offs kept climbing. CRED iQ’s property data suggests why the relief may not last, expenses are still outrunning income for the median property, and NOI is flat to negative for roughly half the national multifamily book. The Denver, Seattle, and San Francisco pattern is worth watching heading into Q3 in particular, since it shows income and expense pressure compounding in the same markets rather than offsetting each other. Whether Q2 marks a real inflection point or a one-quarter pause depends on how both bank call reports and property fundamentals shape up next quarter.
Sources: CRED iQ analysis of all FDIC-insured institutions, multifamily residential real estate loans, Q1 2007 through Q2 2026; CRED iQ proprietary analysis of securitized multifamily loan-level property financials, reporting periods since June 2026.
