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FHFA’s 2024 Multifamily Caps Reinforce a Focus on Workforce Housing

11.14.2023 | Industry Update

The Federal Housing Finance Agency (FHFA) has announced the 2024 multifamily volume cap structure for the Government-Sponsored Enterprises (GSEs) Fannie Mae and Freddie Mac. These caps are set each year to ensure enough liquidity for the multifamily market – with a particular emphasis on mission-driven housing – without crowding out private capital. 

For 2024, the FHFA has set the volume cap for loan purchases at $140 billion, or $70 billion for each Agency – a level described as “appropriate given current market forecasts.” This is a marginal decrease (6.67%) from the 2023 cap of $150 billion ($75 billion for each Agency), though the FHFA will continue to monitor the multifamily mortgage market and increase caps as necessary. 

The new cap structure continues the trend of providing additional benefits for affordable and workforce housing properties. While 50 percent of 2024’s GSE business must be for mission-driven affordable housing (unchanged from 2023), all loans classified as supporting workforce housing properties will now be exempt from the 2024 volume cap. 

As outlined in the 2024 cap structure fact sheet, workforce housing loans:

  • Preserve rents at affordable levels in multifamily properties, typically without the use of public subsidies and 
  • Offer affordability levels corresponding to 80-120 percent of area median income (AMI), depending on the market.

According to a statement from FHFA Director Sandra L. Thompson in the FHFA’s press release, this exemption for workforce housing loans is intended to “encourage conventional borrowers to commit to preserving rents at affordable levels for extended periods of time.” 

Both Fannie Mae and Freddie Mac have introduced loan programs that offer borrowers pricing incentives for creating or preserving units that are affordable at workforce levels. Contact your NewPoint Originator to learn more about workforce housing financing or the implications of the 2024 FHFA multifamily volume.