Agency to raise multifamily limits by more than 4% over this year's levels
The Federal Housing Finance Agency (FHFA) is increasing the multifamily loan purchase cap for Fannie Mae and Freddie Mac to a total of $146 billion combined for 2025, upping their buying limit in the space by over 4%.
The agency said on Monday it had decided to increase the caps, which are determined on a yearly basis, to $73 billion for each government-sponsored entity (GSE) for the year ahead, an increase from $70 billion each in 2024.
Multifamily loans that finance workforce housing are to be excluded once again from the 2025 limits, the FHFA confirmed.
Sandra Thompson, the FHFA’s director, said the decision showed its “strong commitment” to provide the liquidity needed to improve affordability in the rental space.
FHFA will allow greater rental housing support from Fannie Mae and Freddie Mac (the Enterprises) by raising the 2025 multifamily loan purchase cap for each Enterprise to $73 billion, a more than 4 percent increase from 2024, the Agency announced today. https://t.co/lfMwQn9SrO pic.twitter.com/LK1ZkUX7Tl
— FHFA (@FHFA) November 18, 2024
Extending the workforce housing exemption, meanwhile, “will continue to enhance the Enterprises’ ability to support properties that preserve affordable rents, including properties preserved or created through corporate-sponsored affordable housing units,” she said.
The agency also said it would not lower the caps if 2025’s multifamily market performance is more muted than first expected – and that it could raise the caps further if required.
The news marks a change in approach from the same time last year, when the FHFA revealed it was setting its 2024 loan cap for the GSEs $5 billion below the 2023 limit.
Kevin Palmer, head of multifamily for Freddie Mac, said in a statement that the organization was focused on adapting to market conditions and meeting its mission to ensure liquidity, stability and affordability in the market. “FHFA’s requirements create the conditions for us to deliver on our priorities,” he said.
“In 2025, we will continue our day-to-day focus on supporting affordable rental housing for families across the country.”
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