The Federal Housing Finance Agency is leaving the government-sponsored enterprises' multifamily caps for 2019 unchanged at $35 billion per agency, but is making other changes to prerequisites for excluded loans.
The FHFA is raising the minimum level of energy and/or water savings a green-loan-financed project must produce by five percentage points to 30%.
The agency also will require that a minimum of 15% of the savings financed through Fannie Mae's Green Rewards or Freddie Mac's Green Up loan programs be in the form of energy consumption.
In addition, the FHFA will have a data collection requirement for these excluded loans next year.
"The consumption reduction threshold ensures that the benefits from the green renovations as passed through to tenants, while the added data requirements allows FHFA to assess the efficacy of the enterprises' green improvements programs on an ongoing basis," the FHFA said in a press release.
The one other change in the FHFA's requirements related to its 2019 multifamily caps is a tweak in the framework for loans that qualify for exclusions because they finance affordable units in cost-burdened renter markets.
Next year, the FHFA will begin using a "data-driven approach" that will "designate markets in which units affordable to cost-burdened renters at certain area median income levels will be excluded."
Currently, the FHFA allows exclusions for units "at rents affordable to those at or below 120% of the area median income in extremely high-cost markets."
Exclusions for cost-burdened renters will continue to be allowed on a pro rata basis.
The FHFA plans to release more details related to its multifamily requirements in its 2019 scorecard.
Multifamily and commercial originations are on track to collectively
The FHFA reassesses its multifamily caps quarterly, and will adjust the caps if production levels are significantly higher than expected. It expects multifamily production levels to be flat next year in comparison to 2018.
