Freddie Mac closed the record-breaking $28.8 billion in new multifamily business transactions in 2006, the company announced yesterday, Feb. 5th. This volume marks a 10% increase over the $26.2 billion in 2005. Approximately $1.2 billion came from targeted affordable housing products which finance state subsidized apartments. Approximately 478,000 apartment homes for families with low to moderate income were financed by Freddie Mac’s multifamily transactions.
Michael C. May, senior vice president of Freddie Mac’s Multifamily Sourcing Division said they are “very proud” of the success, which was achieved by streamlining the processes, enhancing many of the products and “by being more flexible and innovative”.
Freddie Mac has provided more than $147 billion for financing over 48, 000 multifamily properties since the introduction of the Program Plus network in 1993. $500 million were invested in low-income housing in 2006.
In January, the company’s economic outlook for 2007 was published, which highlighted three major economic trends: higher levels of refinance activity, diversification of the refinancing market, and lack of affordable housing. These trends are believed to influence the Real Estate market and the mortgage activity throughout the country. The market share of adjustable-rate mortgages will probably drop due to low interest on fixed-rate mortgages. The mortgage activity is likely to decline altogether, in spite of high refinancing expectations.
Freddie Mac was established by Congress in 1970 to support homeownership and rental housing. The stockholder-owned corporation finances single-family and multifamily residential mortgages and currently holds a 15% market share.
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