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FHFA Evaluates Future Goals

multifamily, apartment, rentalThursday, the Federal Housing and Finance Agency proposed its 2018-2020 housing goals for Fannie Mae and Freddie Mac. The FHFA is proposing a rule to establish new Single-Family Housing Goals and new Multifamily Housing Goals giving opportunity to comment. The rule would make a number of clarifying and conforming changes, according to the FHFA, “including revisions to the requirements for the housing plan that an Enterprise may be required to also submit in response to a failure to achieve one or more of the housing goals.”

The proposed benchmark levels for low-income, very low-income home, and low-income refinance goal will remain unchanged from the 2015-2017 time frame at 24 percent, 6 percent, and 21 percent respectively. Low-income areas home purchase subgoal is proposed at a 1 percent increase from the current benchmark level of 14 percent.

To meet a single-family housing goal or subgoal, the Enterprise that meets the percentage of mortgage purchases goal or subgoal must exceed either benchmark set by the FHFA or the market level for that particular year. This level is decided retrospectively each year based on the goal-qualifying share of the overall market as measured by FHFA based on the Home Mortgage Disclosure Act (HMDA) data for that year.

The proposed multifamily goal for low-income will increase 15,000 from the current level of 300,000 while the very low-income goal of 60,000 will remain unchanged. Though the low-income small multifamily subgoal has increased by 2,000 each year since 2015, this year it will remain the same as the current level at 10,000 units.

An Enterprise must purchase mortgages on multifamily properties, which are properties with five or more units, with rental units affordable to families in each category, as well as a subgoal for properties with 5-50 units to meet the multifamily housing goal or subgoal.

Though the Enterprises are still under conservatorship, they still have to support a stable and liquid national market for residential mortgage financing. The FHFA said they have continued to establish annual housing goals for the Enterprises and continued assessing their performance under the housing goals each year during conservatorship.

The FHFA is accepting written comments on the proposed rule within 60 days of publication in the Federal Register. For more information on commenting, click here.

 

About Author: Brianna Gilpin

Brianna Gilpin, Online Editor for MReport and DS News, is a graduate of Texas A&M University where she received her B.A. in Telecommunication Media Studies. Gilpin previously worked at Hearst Media, one of the nation's leading diversified media and information services companies. To contact Gilpin, email [email protected].
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