The National Multi Housing Council (NMHC) and the National Apartment Association (NAA) have published a white paper addressing what they define as ‘key principles [that] a reformed housing finance system needs to embrace to preserve liquidity and stability for the well-performing multifamily sector.’
‘The industry supports a return to a system dominated by private capital; however, even in healthy economic times, private capital has not been able to meet the broad liquidity needs of the apartment industry,’ says NMHC President Doug Bibby. ‘A private-only housing finance system results in an overabundance of capital for high-end properties in top-tier markets, but leaves secondary and smaller markets underserved. Private capital is returning to the market, but as has been the case historically, it is concentrating in a handful of cities and on trophy assets.’
The NMHC/NAA white paper points out that the multifamily programs of Fannie Mae and Freddie Mac were not part of the meltdown and have actually generated $7 billion in net profits for the government since conservatorship. The white paper urges that multifamily housing reform should focus on issues that include access to federal credit support, the encouragement of competition, and a federal mission that ‘should focus on liquidity, not mandates.’
‘Ensuring capital is available in all markets and at all times so the apartment industry can continue to provide housing from coast to coast should be the goal of housing finance reform,’ says NAA President Doug Culkin. ‘A solution that doesn't recognize the unique needs of the multifamily sector would have disastrous consequences for the nation's supply of workforce housing.’
The white paper is now available online.