The Federal Housing Finance Agency (FHFA) is seeking feedback on its proposal to recalibrate housing goal benchmarks for Fannie Mae and Freddie Mac for 2026-2028. The agency said it is aiming to streamline the framework governing how the government-sponsored enterprises (GSEs) support affordable housing while accounting for the state of market.

These adjustments are being recommended based on econometric forecasts and recent market developments showing limited affordable inventory, persistently high mortgage rates and affordability challenges for low- and moderate-income borrowers. The agency cited data from Moody’s Analytics and the National Association of Realtors showing that affordability improved slightly from 2024 to 2027 but remains historically low.

The proposal follows market concerns that overly ambitious housing goals may have distorted lending incentives. Industry feedback suggested that competition between the enterprises for a limited pool of affordable loans has driven up prices and, in some cases, led lenders to reject middle-class borrowers or raise their costs. FHFA said lowering benchmarks would allow a more accurate reflection of market capacity and prevent unintended upward pressure on prices.

The proposal covers purchase and refinance benchmarks for single-family residential mortgage loans, as well as goals for multi-family residential loans.

Under the Safety and Soundness Act, the GSE single-family housing goals are limited to mortgages on owner-occupied housing with one-to-four units. They apply to first-lien, conventional, conforming mortgages — mortgages with principal balances that do not exceed the conforming loan limits for GSE mortgages, are not subordinate to other mortgage liens and are not insured or guaranteed by the Federal Housing Administration (FHA) or another government agency.

For low-income home purchases, the GSEs’ benchmark goal would drop to 21 percent from 25 percent, while the very low-income home purchase goal would decrease to 3.5 percent from 6 percent. For low-income refinances, the benchmark goal would remain at 26 percent.

There would also be a subgoal for home purchases in newly defined low-income areas of 16 percent, combining low-income and minority census tracts.

Multifamily benchmarks would remain unchanged at 61 percent for low-income, 14 percent for very low-income and 2 percent for small multifamily properties.

The new benchmarks are, in part, a response to a January presidential memorandum directing agencies to help lower housing costs and expand supply, according to the FHFA. The agency said it believed the recalibration will improve data collection on the effects of pricing mechanisms and lending practices. This information would then be used to inform future rulemakings intended to support all income levels “fairly.”

“In previous iterations of the enterprise housing goals rules, the agency has, by design, afforded less significant weight to the enterprises’ past performance and effort to achieve the housing goals in setting future benchmarks,” the FHFA wrote in the proposal. “This approach was largely predicated on a recognition that past performance data, while valuable, may not always capture the nuances of the enterprises’ efforts, particularly regarding the specific actions taken to achieve goals, and a larger weighting on the enterprises’ ability to lead the mortgage market. However, recent insights into the enterprises’ operational behaviors, coupled with an updated understanding of how various pricing mechanisms can affect overall housing affordability, necessitate a recalibration of the agency’s approach.”

The annual housing goals are a key measure of the GSEs’ success in meeting their public mandates as defined by statute, which include ‘‘an affirmative obligation to facilitate the financing of affordable housing for low- and moderate-income families in a manner consistent with their overall public purposes, while maintaining a strong financial condition and a reasonable economic return,” the proposal states.

The FHFA will accept public comments on the proposal until Nov. 3.