FHFA sets new percentage-based benchmark for multifamily housing goals

The Federal Housing Finance Agency has finalized the benchmark levels for Fannie Mae and Freddie Mac’s multifamily housing goals for 2023 and 2024.

Under the existing regulation, FHFA measures the impact of the multifamily goals based on the total number of affordable multifamily units financed by mortgage loans purchased by government-sponsored enterprises (GSEs) each year.

In the final rule, FHFA used a new methodology that established the benchmark levels based on the percentage of affordable units in multifamily properties financed by GSE-backed mortgages. The benchmark levels for the 2023-2024 multifamily goals were as follows:

• Low-income goal - 60% of all goal-eligible units in multifamily properties financed by mortgages purchased by the enterprises in that year that are affordable to low-income families, defined as families with incomes less than or equal to 80% of area median income (AMI)
• Very ​Low-Income Subgoal – 12% of all goal-eligible units in multifamily properties financed by mortgages purchased by the enterprises in that year that are affordable to very low-income families, defined as families with incomes less than or equal to 50% of AMI
• Small Multifamily Low-Income Subgoal (5-50 units) – 2.5% of all goal-eligible units in all multifamily properties financed by mortgages purchased by the enterprises in that year that are units in small multifamily properties affordable to low-income families, defined as families with incomes less than or equal to 80% of AMI

“The multifamily housing goals are one method FHFA employs to ensure the enterprises remain focused on affordable segments of the market, consistent with FHFA’s statutory duty to promote affordability nationwide,” said FHFA director Sandra Thompson. “The new methodology will make the multifamily housing goals more responsive to market conditions and better position the enterprises to fulfill their affordable housing mission requirements each year.”