The Federal Housing Finance Agency should not proceed with any further reductions in Fannie Mae and Freddie Mac's support for multifamily lending, according to nine congressmen.
“At a time when rents are high, housing inventories are low and the need for more product in the market is strong, now is not the time to reduce the availability of multifamily capital and liquidity,” the House Financial Services Committee members say in a joint letter.
The FHFA is considering scaling back the GSEs’ multifamily programs by 10% in 2014, after mandating a similar reduction in 2013.
It appears Fannie and Freddie could simply sell multifamily loans out of their portfolios to satisfy the FHFA this year. But for 2014, the GSE regulator is proposing to restrict loan terms and loan products along with re-imposing multifamily loan limits.
The eight Democrats and one Republican congressmen point out that the GSE multifamily programs have performed well throughout the financial crisis and today their delinquency rates are less than 0.25%.
As the GSE conservator, the FHFA should preserve the
“We wish to remind you that there is no consensus in Congress on how to proceed with GSE reform and therefore urge you to preserve and conserve Fannie and Freddie's role in the multifamily housing industry as well as not take any drastic action that erodes their important role in the industry,” the letter says.
