FHFA: 2017 Fannie Mae and Freddie Mac Multifamily Lending Caps Will Not Change

Fannie Mae and Freddie Mac multifamily lending caps will remain the same in 2017 as in 2016, reported the Federal Housing Finance Agency, Washington, D.C.  This means that each enterprise will be subject to a $36.5 billion cap on multifamily purchase volume next year. 

FHFA based the caps on projections of the overall size of the 2017 multifamily finance market, which the agency expects will be roughly the same as in 2016. 

FHFA noted that it will share more details soon. “While the 2017 Scorecard will provide more information about the role FHFA expects the enterprises to play in the multifamily market, FHFA is announcing the caps now to maintain continuity in the market and to provide all stakeholders adequate time to plan their 2017 pipelines,” the agency said. “As in prior years, FHFA will review its estimates of the multifamily loan origination market size on a quarterly basis in 2017 and adjust the caps if necessary.” 

FHFA said it will not reduce the caps “as this could cause disruption in the market.”

The multifamily lending caps further FHFA’s goal of maintaining Fannie Mae and Freddie Mac as a “backstop” for the multifamily finance market while not impeding private capital participation, the agency said. 

There are certain exclusions from the 2017 caps for loans in the affordable and underserved market segments. “These exclusions will remain the same in 2017 as they were in 2016 with one minor change to the exclusion for multifamily loans that finance energy or water efficiency improvements,” FHFA said. “In 2017, for loans funded under Fannie Mae’s Green Building Certification program or Freddie Mac’s Green Certified program, a minimum of 20 percent of units in a multifamily project must be deemed affordable in order to take advantage of this exclusion.”