Fannie Mae and Freddie Mac will be allowed “limited re-entry” as equity investors in the market for low-income housing tax credits, the Federal Housing Finance Agency said today. Each GSE will be subject to an annual investment limit of $500 million, with any investments beyond $300 million in a given year required to be in areas identified by FHFA as having difficulty attracting investors.
“This decision demonstrates our commitment to supporting affordable rental housing in a controlled and thoughtful manner intended to stabilize the market and not to compete with private investors,” said FHFA Director Mel Watt. “Most of the enterprises’ investments will be used to facilitate transactions that support underserved markets and complement our ‘duty to serve’ priorities.”
