
Fannie Mae has a new solution to help create and preserve workforce housing through its network of Delegated Underwriting and Servicing (DUS) lenders. Its Sponsor-Dedicated Workforce (SDW) product features pricing incentives and underwriting flexibilities for conventional and social impact multifamily borrowers that elect rent restrictions on eligible properties for the life of the loan.
“Affordability continues to be a significant challenge for multifamily renters as rent increases have outpaced income growth,” said Michele Evans, executive vice president and head of Fannie Mae Multifamily. “Fannie Mae is addressing the need for workforce housing by providing innovative, attractive programs that create and preserve affordable multifamily units while enabling socially responsible investment opportunities for investors.”
To take advantage of the product, borrowers must agree to preserve or create a multifamily development with a minimum of 20% of the units at levels affordable to residents earning up to 80% of the area median income (AMI) or up to 100% to 120% of the AMI in certain cost-burdened designated metro areas. The rent restrictions will be documented in the loan documents, with DUS lender partners confirming compliance annually.
“Fannie Mae’s new Sponsor-Dedicated Workforce product will help solve rental affordability, accessibility, and sustainability challenges that missing-middle renters currently face. With this creative new financing solution, Fannie Mae and our partners can increase the supply of workforce rental units across the country and support long-term housing stability for renters,” said Rob Levin, senior vice president and multifamily chief customer officer. “We look forward to providing our lenders and borrowers with competitive pricing, certainty of execution, and efficiency under our delegated underwriting model so they can readily use this product.”