FHFA Doubles Cap for GSE Investment in Low Income Housing Tax Credits

FHFA Doubles Cap for GSE Investment in Low Income Housing Tax Credits
News| August 5, 2025| Paul Bubny
Apartment Buildings

The Federal Housing Finance Agency said Tuesday it is doubling the amount that Fannie Mae and Freddie Mac can invest Low Income Housing Tax Credit properties. The cap is being raised from $1 billion to $2 billion each, a total of $4 billion per year.

In a statement, FHFA said, “Today’s increase means that, in a safe and sound manner, Fannie and Freddie can together now deploy $4 billion each year in support of the affordable housing tax credits — half of which will be reserved for difficult to serve LIHTC markets and at least 20% of that half will be Duty to Serve Rural Communities.”

Mortgage Bankers Association president and CEO Bob Broeksmit applauded the increase. “The LIHTC program is the federal government’s most successful tool to support the construction and rehabilitation of housing for low- and moderate-income households,” he said. “FHFA’s doubling of the GSEs’ cap on LIHTC investment to $2 billion comes on the heels of program improvements included in H.R. 1 (now Public Law 119-21), both of which will help to increase rental housing supply.”

At the National Multifamily Housing Council, president Sharon Wilson Géno said, “This step by FHFA is great news for housing providers seeking to use LIHTC to build and preserve housing, as well as individuals and families searching for affordable housing opportunities. As someone who has spent more than 30 years working in and advocating for the affordable housing community, I have seen firsthand how LIHTC can be one important tool to help us build the housing America needs.”

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