WASHINGTON, D.C. — The Federal Housing Finance Agency (FHFA) has increased the multifamily loan purchase caps for Fannie Mae and Freddie Mac for their 2025 production. The government-sponsored enterprises (GSEs) will each have caps of $73 billion, or $146 billion combined, which is a four percent increase from the 2024 caps of $70 billion each.
Bob Broeksmit, president and CEO of the Mortgage Bankers Association (MBA), states that the move to increase the cap is fitting due to recent moves by the Federal Reserve, which has twice reduced the federal funds rate in recent months.
“The four percent 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,” says Broeksmit.
The FHFA will continue to exclude multifamily loans that finance workforce housing assets from the 2025 cap and require the GSEs to have at least 50 percent of their multifamily originations finance “mission-driven” affordable housing.
Additionally, the FHFA will continue to monitor the multifamily mortgage market and update the caps and requirements if necessary. If the FHFA determines that the size of the 2025 market is smaller than was initially projected, the agency states that it will not lower the caps.