Consistent with President Trump’s “One Big Beautiful Bill,” the Federal Housing Finance Agency (FHFA) announced that it is expanding the affordable housing supply by doubling the amount that Fannie Mae and Freddie Mac can invest in “safe and sound” Low Income Housing Tax Credit (LIHTC) properties from $1 billion to $2 billion each. The government-sponsored entities (GSEs) are important investors in LIHTC bonds, which help provide the cash developers need to build and renovate low-to-moderate income properties.

This increase means that 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 percent of that half will be for Duty to Serve rural communities.

Following the announcement, the National Association of Realtors (NAR) issued a statement of support.

“We thank [FHFA] Director [Bill] Pulte and his team for taking action to expand the supply of housing and break down barriers to homeownership,” NAR Executive Vice President and Chief Advocacy Officer Shannon McGahn said. “These are important efforts that we have long supported. Doubling the contributions to the development of LIHTC properties provides incentives to investors to support housing development, while the developer gets access to critical capital for construction. This is an important step to ease cost burdens in low-and moderate-income areas and we appreciate the director’s leadership role in this market.”

The Mortgage Bankers Association (MBA) also applauded the FHFA’s announcement.

“MBA commends President Donald Trump and FHFA Director Bill Pulte for their commitment to address our nation’s ongoing housing affordability challenges and boosting construction of affordable rental housing,” MBA President and CEO Bob Broeksmit said. “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. 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.”