On October 30, FHFA released its 2023 Annual Housing Report outlining Fannie Mae and Freddie Mac’s affordable housing activities in 2022 and evaluating whether they met their affordable housing obligations. The Report describes the affordable housing allocations made by each Enterprise, as well as FHFA’s efforts to survey the mortgage markets and release loan-level data submitted by the Enterprises to the public. Finally, the Report discusses subprime, nontraditional, and higher-priced mortgage loans.

FHFA and the Enterprises are tackling these current affordability issues with major initiatives in a variety of areas.

Affordable Housing Goals. In 2021, FHFA issued a final rule for the Enterprises that established more ambitious benchmark levels for the 2022-2024 single family and 2022 multifamily housing goals than in previous years to promote affordable housing access. Effective in 2022, the final rule also established two new single-family area-based subgoals, the minority census tracts subgoal and the low-income census tracts subgoal, to replace the existing low-income areas subgoal. This change requires the Enterprises to purchase loans from minority census tracts to drive liquidity to support borrowers in those communities.

In February 2023, FHFA and Freddie Mac agreed to a remedial housing plan for failure to meet the low-income refinance goal in 2020. FHFA has been monitoring Freddie Mac’s progress on this plan as it is imperative that Freddie Mac follow a business strategy to allow more low-income households to take advantage of a future refinance market opportunity.

Equitable Housing Finance Plans and Duty to Serve Update. In September 2021, FHFA instructed each Enterprise to submit an Equitable Housing Finance Plan that identifies and addresses barriers to sustainable housing opportunities. As part of these plans, FHFA required the Enterprises to take actions to reduce the racial or ethnic homeownership gap and reduce underinvestment or undervaluation in formerly redlined areas that remain underserved.

Since the initial Equitable Housing Finance Plans took effect, the Enterprises have helped more than 834,000 American families through associated programs. In April 2023, the Enterprises modified their Equitable Housing Finance Plans to include further considerations of barriers facing renters and homeowners of color and in underserved communities. In May 2023, FHFA released a proposed rule that would codify the process and standards for the Equitable Housing Finance Plans in the future. FHFA is currently reviewing the public comments received on that rule, many of which addressed underrepresented communities, such as Asian American and Pacific Islander communities.

Under the Duty to Serve program, the Enterprises are working, among other objectives, to develop new solutions to challenges for sustainable homeownership in Native American communities by expanding access to conventional loans and the provision of support to Native Community Development Financial Institutions (CDFIs).

Multifamily Market. In September 2021, FHFA increased the annual Low-Income Housing Tax Credit caps for the Enterprises to $850 million to support transactions that traditionally have difficulty attracting investors. In November 2022, FHFA changed the multifamily housing loan purchase caps for 2023 to require that at least 50 percent of the Enterprises’ multifamily business be mission-driven affordable housing. FHFA also revised certain multifamily requirements for mission-driven affordable housing to ensure that loans on affordable units in cost-burdened renter markets and loans to finance energy or water efficiency improvements are classified as mission-driven.

In 2023, FHFA instructed the Enterprises to explore the feasibility of expanding multifamily tenant protections for properties they finance and to identify strategies and activities that could facilitate a greater amount of affordable rental housing supply. FHFA also published a Request for Input on tenant protection issues and potential solutions, which received over 3,700 responses. These actions help ensure that properties financed by the Enterprises continue to provide safe and sustainable housing for tenants across the country.

Report Findings

2022 Housing Goals Performance – Multifamily

In October 2023, FHFA notified Fannie Mae and Freddie Mac of FHFA’s final determination that each Enterprise met all of the multifamily housing goals in 2022, as shown in Tables 3 and 4 below.

Goals and Performace

Duty of Serve Underserved Markets

For 2022, FHFA assigned Fannie Mae a rating of Low Satisfactory for its activities in the manufactured housing market, a rating of Low Satisfactory for its activities in the affordable housing preservation market, and a rating of High Satisfactory for its activities in the rural housing market. For 2022, FHFA assigned Freddie Mac a rating of High Satisfactory for its activities in the manufactured housing market, a rating of Low Satisfactory for its activities in the affordable housing preservation market, and a rating of High Satisfactory for its activities in the rural housing market. Additional information about the Enterprises’ 2022 Duty to Serve activities is available on the Duty to Serve web page on fhfa.gov.23 The following provides a summary of the Enterprises’ performance of their Duty to Serve Plan objectives in 2022. Fannie Mae and Freddie Mac exceeded their 2022 targets for Housing Credit investments for properties in rural areas and for equity investments in Housing Credit properties. In total, Fannie Mae and Freddie Mac made 887 Housing Credit investments in 2022, including investments in 95 rural properties.