Freddie Mac Achieves Goals in Affordable Multifamily Housing

Author Rick Bell Read bio
Tags: multifamily
Date: February 1, 2024

The company supported 423,000 affordable rental units in 2023.

In 2023, Freddie Mac Multifamily’s total volume exceeded $49 billion, comprising $48.3 billion in financing and over $883 million in investments through the low-income housing tax credit (LIHTC) program.

The organization successfully reached its affordable housing goals set by the Federal Housing Finance Agency (FHFA), supporting 423,177 affordable rental units nationwide. This achievement aligns with their commitment to the 2023 multifamily affordable housing mandates.

Significantly, 66% of Freddie Mac’s total production for 2023 fell under “mission-driven affordable housing,” surpassing the FHFA’s target of 50%. A majority of the units financed, over 67%, were accessible to residents earning below 80% of the area median income (AMI), and over 20% catered to very low-income residents earning no more than 50% of the AMI. This exceeded the set objectives. Overall, 92% of the units financed in 2023 were affordable to those earning at or below 120% of the AMI.

Last year, Freddie Mac Multifamily successfully exceeded its set goals for affordable housing, even amidst challenging market conditions. Kevin Palmer, the head of Freddie Mac Multifamily, attributed this success to the collective efforts of their team, Optigo lenders, and borrowers. He emphasized the organization’s commitment to its mission, highlighting their role as a consistent provider of market rate loans, contributing to market liquidity and stability under various conditions.

Freddie Mac also met its LIHTC equity Duty to Serve target in 2023, with over $883 million in LIHTC equity investments. This achievement aligns with the FHFA’s decision to raise the LIHTC equity cap to $1 billion for 2024. Since 2018, Freddie Mac Multifamily has committed more than $4 billion in LIHTC equity, aiding the creation or preservation of nearly 30,000 affordable housing units.

Moreover, in 2023, Freddie Mac Multifamily funded a record $2.6 billion in forward conversions, supporting the creation and preservation of over 21,000 affordable units. Additionally, the company committed to funding $2.3 billion in the future, aiming to support the construction or rehabilitation of over 22,000 units. Their forward program plays a crucial role in boosting the supply of affordable housing by ensuring permanent financing availability, even in fluctuating markets.

Freddie Mac Multifamily financed over $13 billion in Targeted Affordable Housing in 2023, assisting nearly 108,000 rent-restricted affordable units. The company also marked a significant milestone in financing nearly 29,000 manufactured housing community pads with tenant protections that align with the standards of its Duty to Serve Plan, according to the company.