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The Federal Housing Finance Agency (FHFA) has announced that the 2024 multifamily loan purchase caps for Fannie Mae and Freddie Mac (the government-sponsored enterprises) will be $70 billion for each GSE, for a combined total of $140 billion to support the multifamily market.
The 2023 volume caps applicable to the multifamily loan purchases of the GSEs was $75 billion for each GSE in 2023, for a total of $150 billion during the calendar year.
To ensure a strong focus on affordable housing and underserved markets, FHFA will require that at least 50% of the GSEs’ multifamily businesses be mission-driven, affordable housing. In addition, for 2024, loans classified as supporting workforce housing properties in Appendix A of the Conservatorship Scorecard will be exempt from the volume caps. All other mission-driven loans remain subject to the volume caps.
“The 2024 multifamily loan caps, coupled with the exemption for workforce housing properties from the caps, will promote the Enterprises’ continued strong commitment to addressing the need for affordable rental housing,” said FHFA Director Sandra L. Thompson. “The workforce housing exemption should encourage conventional borrowers to commit to preserving rents at affordable levels for extended periods of time.”
To ensure the GSEs continue to provide sufficient liquidity and support in the multifamily mortgage market, FHFA will continue to monitor this market and will increase the caps if necessary. However, to prevent market disruption, if the FHFA determines that the actual size of the 2024 market is smaller than was initially projected, FHFA will not reduce the caps.
"A cap of $70 billion for each of the GSEs is reasonable, given the challenging market conditions and high interest rate environment expected in 2024,” added Mortgage Bankers Association (MBA) President and CEO Robert D. Broeksmit, CMB. “We appreciate FHFA’s ongoing flexibility should adjustments to the caps and mission-driven requirements be necessary and believe exempting loans supporting workforce housing from the cap levels will help to ensure GSE financing is a viable option for housing providers in the current environment. MBA supports a level playing field across various capital sources and will continue to work with FHFA, the GSEs, and other industry stakeholders on ways to increase affordable rental housing.”
