November 16, 2017
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The Federal Housing Finance Agency (FHFA) today announced that it will permit the Government-Sponsored Enterprises (GSEs), Fannie Mae and Freddie Mac, to resume equity investments in the Low Income Housing Tax Credit (Housing Credit) market, with some limitations, effective immediately. The GSEs each will be able to invest up to $500 million annually in the Housing Credit; however, annual investments above $300 million must be made in markets identified by FHFA as having difficulty attracting investors.

NCSHA argued in our March 2016 comments on FHFA's Duty to Serve (DTS) Rule in favor of allowing the GSEs to resume making Housing Credit equity investments because it would support resiliency should unexpected future events cause market disruptions and help keep pricing strong in areas in which other investors do not have Community Reinvestment Act obligations. We reiterated our call on FHFA to allow GSE investment in the Credit in our July 2017 comments on the GSEs Duty to Serve Underserved Market Plans. NCSHA has also met with FHFA officials at their request to discuss our comments and perspectives on this issue. In its announcement today, FHFA said it engaged in significant stakeholder outreach about whether the Enterprises should be authorized to re-enter the Housing Credit equity market, including a specific request for comments on this topic in FHFA's proposed DTS rule in 2015

FHFA stated that its decision to allow the GSEs to re-enter the Housing Credit market is based on several factors, including furthering their mission to support affordable housing and ensuring they can play a countercyclical role in the Housing Credit market in the future if needed. FHFA will annually evaluate the GSEs' continued role as Housing Credit equity investors.

Following FHFA's announcement, Fannie Mae and Freddie Mac released comments acknowledging FHFA's new policy and stating that they are preparing to resume Housing Credit investments.