Fannie Mae and Freddie Mac are being permitted to re-enter the low-income housing tax credit (LIHTC) market, it was announced Nov. 16. The Federal Housing Finance Agency, which regulates the two government-sponsored enterprises (GSEs), has allowed Fannie and Freddie to invest in the credits on a limited basis, reports Donna Kimura of MFE sister brand Affordable Housing Finance.
[The FHFA] cited several factors for its decision, including furthering the enterprises’ mission to support affordable housing and ensuring that they could provide “a countercyclical role in the LIHTC market in the future if needed.”
Fannie Mae and Freddie Mac were two of the nation’s largest LIHTC investors, representing an estimated 35% to 40% of the market, before being placed into conservatorship by FHFA in 2008.
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