One of two bills passed by the U.S. House of Representatives will boost limits on some multifamily mortgages insured by the Federal Housing Administration. Legislators are also calling on the Obama administration to provide warehouse lending help.
The House has passed H.R. 3527, the FHA Multifamily Loan Limit Adjustment Act, the Mortgage Bankers Association announced today. The trade group said increased multifamily limits on properties with elevators is an important step in providing rental housing in urban areas.
In a statement last month, the Washington, D.C., group said multifamily buildings of between eight and 24 floors cost 45 percent more to construct than non-elevator buildings — even though the difference in FHA financing for the two types of structures is only 10 percent.
“The increased limits will make it possible for developers to obtain financing to build and rehabilitate high-rise housing,” MBA Chairman David G. Kittle said in the statement.
MBA previously projected that construction of $3 billion in multifamily properties this year would be generated from the bill’s passage.
The House also passed H.R. 3146, 21st Century FHA Housing Act, MBA said. That bill provides resources for much needed FHA staffing and technology.
“And finally, we are gratified to see Congress go on record in stating that HUD, Treasury and the FHFA ought to use their existing statutory and regulatory authority to help solve the crisis in warehouse lending,” Kittle stated. “Independent mortgage lenders, who rely on warehouse lending, provide between 25 and 40 percent of all mortgage financing.
“Without adequate warehouse lines, these lenders may cease to exist, drawing precious capacity out of the mortgage market at a time when we need mortgage financing more than ever.”
Kittle called for quick consideration of the bills by the U.S. Senate.
