Freddie Mac's Multifamily Volume Up in 2011

McLean, Va.—Freddie Mac’s involvement in the multifamily mortgage business totaled $20.3 billion in volume in 2011, according to the GSE, up significantly—32 percent—from the 2010 total of $15.4 billion. Among other things, 2011 was a record-breaking year for Freddie Mac’s conventional programs, settling almost $19 billion, and the volume in targeted affordable housing products, which finance apartments that receive some form of government subsidy, was $1.5 billion.

Some $16.5 billion, or 81 percent, of Freddie Mac’s total new purchase volume was through the Capital Markets Execution program, the largest annual volume amount for that program to date. About 58 percent of the total 2011 loan purchases or credit enhancements by the GSE were refinances, while 35 percent were acquisitions, 5 percent were new construction and the remainder were rehabs.

In the affordable housing realm, for the year Freddie Mac financed about 1,300 properties amounting to about 321,000 apartment units, most of which are affordable to families earning low or moderate incomes. Also during 2011, the GSE purchased over $700 million in seniors housing mortgages and more than $1.1 billion in student housing mortgages. All together, the volume of multifamily bond credit enhancements during 2011 totaled about $1 billion.

For all of last year, Freddie Mac estimates that it financed about 29 percent of the new business in the multifamily market. The company expects a similarly strong year in 2012.

“We ended 2011 and enter 2012 with strong momentum and are poised for robust growth driven by strong fundamentals, low rates, and growing maturities in the industry,” David Brickman, senior vice president of Freddie Mac Multifamily, told MHN. The outlook, he adds, is “very positive” due to solid demographics, low interest rates and strong capital flows into the sector.