The Federal Housing Finance Agency (FHFA) is raising next year’s multifamily loan purchase cap to $73 billion each for Fannie Mae and Freddie Mac, up more than 4% annually.
The purchase caps are reconfigured annually to keep pace with property prices and to support liquidity in the multifamily market, especially for affordable housing and in underserved segments, without crowding out public capital. The FHFA has been setting thresholds on conventional multifamily lending at the government-sponsored enterprises (GSEs) since 2015, expanding the cap to all multifamily business four years later, barring a few exceptions.
This year, the multifamily caps were set at $70 billion for each enterprise; in 2023, the limit was set at $75 billion.
As with this year, the FHFA is exempting loans financing workforce housing properties from the volume caps.
“The 2025 multifamily loan caps reflect the Enterprises’ strong commitment to provide liquidity to make renting a home more affordable,” said Sandra L. Thompson, director of the FHFA. “Additionally, the ongoing workforce housing exemption will continue to enhance the enterprises’ ability to support properties that preserve affordable rents, including properties preserved or created through corporate-sponsored affordable housing initiatives.”
Bob Broeksmit, president and CEO of the Mortgage Bankers Association (MBA), said in a statement that the increase in the multifamily loan ceiling is an apt one.
“The 4% increase in the multifamily loan purchase caps to $73 billion for each GSE is appropriate, given the slightly improved market conditions and lending activity that’s expected next year due to the slow decline in interest rates,” said Broeksmit. “The cap levels should ensure that the GSEs are a viable option for lenders that finance properties that serve lower-income households and those living in rural areas.
“We are also supportive of the continued cap exemptions for loans that support workforce housing and appreciate that FHFA will remain flexible should adjustments to the caps and mission-driven requirements be necessary.”
