The Federal Housing Finance Agency (FHFA) is encouraging the development of workforce housing and will exempt these loans from its lending limits in 2024.
This is part of FHFA’s response to the “national housing affordability crisis” and a demonstration of the agency’s stand against rapid rent growth.
In 2024, FHFA will exempt certain loans for workforce housing from the lending limits imposed on Fannie Mae and Freddie Mac. Each will be capped at $70 billion in multifamily lending next year.
For nonexempt financing, developers must adhere to standards of affordability set by state or local housing initiatives for at least 10 years.
Last month, Fannie Mae launched a loan program to support workforce housing preservation and development with borrowers that restrict rents between 80%-120% of area median income.
If both lenders exceed their combined cap of $75 billion this year, the exemption opens up opportunities to lend more in 2024.
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