Freddie Mac Launches New Multifamily Financing Program Aimed at Lowering Rent Increases

The Wall Street Journal reports that Freddie Mac is rolling out a new program that will offer lower-cost financing to multifamily owners who agree to cap rent increases for the life of their loans. In exchange for the loans at below-market rates, operators must have at least 50 percent of the units be affordable to households making the local median income or below, and must also agree to limit rent growth on 80 percent of the units. David Brickman, Executive Vice President and Head of Multifamily at Freddie Mac, stated that the goal of the program is to “provide an economic basis for private, profit-oriented developers to pursue a strategy where they didn’t raise rents by quite as much.” The article notes that while the rate of rent increases has been decelerating recently, such rental options might help slow the rate of annual rent increases in the future.

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