The Federal Housing Finance Agency (FHFA) has announced the adoption of a final rule establishing the housing goals for Fannie Maeand Freddie Mac for both single-family and multifamily housing for the years 2015 through 2017.
The proposed housing goals rule for the GSEs was first issued in August 2014. More than 144 comments were made on the proposed rule, all of which were considered by the FHFA in the development of the final rule. According to the FHFA, the final rule sets identical benchmarks in all categories for both Fannie Mae and Freddie Mac.
“The single-family goals advance the Enterprises’ statutory missions to provide access to credit for creditworthy borrowers and provide liquidity to the U.S. housing market while operating in a safe and sound manner,” FHFA Director Melvin L. Watt said. “The multifamily goals will create rental opportunities for those who need affordable housing. Together, these goals establish a solid foundation for affordable and sustainable homeownership and rental opportunities in this country.”
The final rule establishes the following single-family housing goals for Fannie Mae and Freddie Mac for each of the three years from 2015 to 2017:
- A low-income home purchase goal of 24 percent, which is a slight increase from the proposed benchmark for each year of 23 percent, which was also 2014’s benchmark goal;
- A very-low income home purchase subgoal of 6 percent, which is down 7 percent from the subgoal in the proposed rule and down 1 percentage point from 2014’s benchmark goal;
- A low-income areas home purchase subgoal of 14 percent, the same as what was in the proposed rule and 3 percentage points higher than 2014’s benchmark goal;
- A low-income refinance goal of 21 percent, down 27 percent from what was in the proposed rule and 1 percentage point higher than 2014’s benchmark goal.
“The single-family goals advance the Enterprises’ statutory missions to provide access to credit for creditworthy borrowers and provide liquidity to the U.S. housing market while operating in a safe and sound manner.”
The final rule establishes goals for the first time for rental units affordable to low-income families in multi-family properties with five to 50 units. According to the final rule, both GSEs’ multifamily low-income goal for each year from 2015 to 2017 is 300,000 units, an increase from the proposed number of 250,000 units for each year for Fannie Mae and the proposed number of 210,000 for 2015, 220,000 for 2016, and 230,ooo for 2017 for Freddie Mac.
FHFA is required to establish housing goals annually for mortgages purchased by the GSEs under the Federal Housing Enterprises Financial Safety and Soundness Act of 1992, which was amended by the Housing and Economic Recovery of 2008.
The final rule will become effective 30 days after it is published in the Federal Register, according to FHFA.