CREF Policy Update: MBA Opposes Biden Campaign’s Nationwide Rent Control Proposal; MBA to FHFA–Expand FHLB Membership to IMBs and REITs
MBA Opposes Biden Campaign’s Nationwide Rent Control Proposal
Last Tuesday, President Joe Biden announced new actions to help lower rental housing costs, including proposals to cap rent increases and repurpose public land to construct more affordable housing.
• The White House fact sheet, among other items, calls on Congress to pass legislation that would force corporate landlords to choose between capping rent increases on existing units at 5% or losing valuable federal depreciation tax credits.
What they’re saying: MBA’s President and CEO Bob Broeksmit, CMB, responded swiftly in a press statement, stating that “Increasing the supply of affordable rental housing nationwide – not politically-motivated and self-defeating rent control proposals floated during election campaigns – is the best way to alleviate affordability constraints for renters.” He added, “While the odds are stacked against this proposal ever passing Congress, a federal rent control law would be catastrophic to renters and our nation’s rental housing market.”
• MBA and the other housing trade groups that make up the Housing Solutions Coalition also sent a press statement – read it here.
Why it matters: The Biden Administration has been very focused on housing affordability and tenant protections. MBA and other industry stakeholders have met with the White House numerous times on these topics, stressing the importance of increasing affordable housing supply and avoiding unnecessary regulations such as rent control.
Go deeper: Last week, the Federal Housing Finance Agency (FHFA) announced new resident-centered practices that will be required in new multifamily loan agreements backed by Fannie Mae and Freddie Mac (the GSEs) beginning in February 2025. However, the practices stopped short of rent control or rent caps.
• In May 2023, FHFA issued a Request for Input (RFI) on resident-centered practices at properties backed by Fannie Mae and Freddie Mac. The RFI was issued in response to an announcement by the Biden Administration in January 2023 that FHFA would engage in industry outreach to determine if there are opportunities to further enhance protections for tenants.
• The Administration’s announcement included new actions by several federal agencies, a “Blueprint for a Renters Bill of Rights,” and a voluntary challenge to the industry to adopt stronger policies and practices that better serve tenants. MBA sent a response letter to the RFI in July 2023 advocating strongly against rent control and offering alternative initiatives for FHFA to consider to support tenants.
What’s Next: Biden’s proposal requires legislation to be passed by Congress, which may prove to be difficult regardless of the outcome of the election. MBA will continue to engage with Congress, the Administration, and other industry stakeholders to advocate for sound and proven solutions that will help boost the supply of affordable housing.
For more information, please contact Stephanie Milner at (202) 557-2747.
MBA to FHFA: Expand FHLB Membership to IMBs and REITs
Last Monday, MBA submitted comments to the FHFA on its Request for Input (RFI) on the mission of the Federal Home Loan Banks’ (FHLBanks).
• FHFA’s RFI sought industry feedback on three key areas: (1) updating the regulatory statement of the FHLBank System’s mission to better reflect its appropriate role in the housing finance system; (2) developing metrics and thresholds to evaluate mission achievement; and (3) identifying how the FHLBanks could incorporate incentives for members with a strong and demonstrable connection to the FHLBank System’s mission.
Why it matters: MBA’s letter reiterated its longstanding position that FHLB membership should be expanded to independent mortgage banks and real estate investment trusts with a “strong and demonstrable connection to the mission of the FHLBank System.” The letter also:
• Explained why expanding eligible collateral types – and then aligning collateral standards across the FHLBs – would also allow the FHLBs to better serve their mission, acknowledging that expanding both FHLB membership and eligible collateral would require certain adjustments to the current system.
• Called for harmonizing the acceptance of warehouse lines, which directly support housing finance activities, to all FHLBs.
• Encouraged FHFA to consider expanding types of eligible collateral mortgage servicing rights (MSRs) and mortgage servicing advances
Go deeper: MBA also stressed the importance of expanding FHLB membership and maintaining the types of collateral that members can pledge under the current system in an October 2022 comment letter.
What’s next: MBA will remain engaged with FHFA, the FHLBs, and lawmakers on both sides and will continue to advocate for expanding membership to institutions like IMBs and mortgage REITs that are almost exclusively focused on housing finance, while ensuring the safety and soundness of the FHLB system.
For more information, please contact Stephanie Milner at (202) 557-2747.
MBA Pushes Back on Implementation of Flood Rule
Last Wednesday, MBA led a coalition letter to the Department of Housing and Urban Development (HUD) urging them to extend the implementation date of the Federal Flood Risk Management Standard (FFRMS).
• The updated policy was finalized in April, with an implementation date for HUD-insured multifamily properties in January 2025. However, a recent HUD memo requires applications to be submitted no later than Sept. 1, 2024, to be eligible for the current standard.
Why it matters: The final rule on FFRMS greatly expands the covered floodplain area and requires significant elevation of properties within those designated areas.
What’s next: MBA will continue to advocate for appropriate timelines for new federal regulations.
For more information, please contact Megan Booth at (202) 557-2740.
Participate in the Mortgage Action Alliance’s “Advocacy in August” Campaign
MBA’s “Advocacy in August” campaign is just two weeks away! Join your fellow industry advocates and Mortgage Action Alliance (MAA) members and get involved during the congressional August recess by taking action on current real estate finance policy priorities and legislative issues – and by arranging to meet with elected officials back in their states or districts.
Why it matters: Like the National Advocacy Conference (NAC), “Advocacy in August” is an important political engagement strategy for our industry to help advance key policy and advocacy priorities. Participation through these types of meetings allows us to build and strengthen individual relationships during the traditional congressional August recess.
What’s next: MBA’s Legislative and Political Affairs team will once again coordinate in-person and virtual meetings in elected officials’ home states or districts. Get involved!
For more information, please contact Jamey Lynch at 202-557-2818.
REGISTER: MBA’s Commercial/Multifamily Insurance Conclave 2024
MBA is hosting a Commercial/Multifamily Insurance Conclave 2024 on Oct. 6-8 in Kansas City, Mo.
• This premier event brings together Insurance and Risk professionals from all capital sources to discuss insurance market trends, best practices for addressing and implementing changes in the future, and much more.
Why it matters: Rising property insurance costs and diminishing policy options are increasingly becoming a problem in several states, and insurance requirements are becoming more strict.
What’s next: Register today to secure your seat.
For more information, please contact Jacky Salazar at (202) 557-2746.
Upcoming MBA Education Webinars on Critical Industry Issues
MBA Education continues to deliver timely commercial/multifamily and single-family programming that covers the spectrum of challenges, obstacles and solutions pertaining to our industry. Below, please see a list of upcoming and recent webinars – which are complimentary to MBA members:
• Analyzing the Commercial/Multifamily Borrower’s Balance Sheet and REO Schedule – Aug. 27
• Affordable Housing Insights: Understanding Consumers, Buyers, and Uses of Accessory Dwelling Units – Aug. 29
• Finding Opportunities with Distressed CRE in 2024 – Sept. 10
• Overview of Commercial Insurance Compliance – Oct. 3
MBA members can register for any of the above events and view recent webinar recordings by clicking here.
For any questions, please contact David Upbin at (202) 557-2931.
