This policy statement, released by the Federal Housing Finance Agency (FHFC), was applauded by the National Multi Housing Council (NMHC) and National Apartment Association (NAA).
We commend FHFA for recognizing that the GSEs multifamily programs are working well, were not part of the housing meltdown and require a separate solution from single-family housing finance reform. This is the first time a written housing finance proposal has explicitly called for a separate multifamily solution,” says Cindy Chetti, NMHC Senior Vice President of Government Affairs.
Chetti calls FHFAs plan a critical step in the right direction that validates the work of the apartment industry in advocating for separating solutions for multifamily from single-family inreforming our housing finance system.
We would also encourage FHFA to pursue separate timetables for addressing the GSEs single-family and multifamily programs. The multifamily solution should be expedited and not held back while solutions to the far more complex single-family problems are sought,” she said.
NMHC will continue to review the assessments called for by the FHFA plan to determine whether the GSEs multifamily programs can be operated on a stand-alone basis without government guarantees.
Ultimately, we need to return to a housing finance system that is dominated by private capital,” Chetti continues. “Historically, however, even in healthy economic times the private sector has not been able to fully meet the capital needs of the apartment industry. Private capital generally flocks to top-tier markets and trophy properties. Thats exactly what is happening now. The new institutional capital coming in is concentrating in a handful of markets and on high-end assets, leaving vast amounts of the country out.”
The GSEs have been critical in ensuring that there is sufficient capital in all markets at all times, in places like Indianapolis and Kansas City. Having liquidity nationwide is more important than ever as the nation relies increasingly on rental housing. Up to half of all new households created in the next decade could be renters”upwards of seven million new renter households, according to the NMHC.
Chetti adds, We look forward to working with both the regulators and Congress in their efforts to retain what works in the multifamily housing finance system and to ensure that reform efforts do not interrupt the critical flow of liquidity to rental housing.
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