“Never in the history of the Federal Housing Administration (FHA) has there been such demand for FHA-insured financing to build, rehabilitate or refinance multifamily apartment communities,” says National Mortgage Professional in a report today about the $10.5 billion the FHA has put into multifamily rental housing loans since October of last year. This is only the second time ever that the FHA has funded more than $10 billion in multifamily loans. Carol Galante, acting commissioner of the FHA, says that the spike in lending shows that “FHA has never been more relevant” than in “these tough economic times” and is promising to accelerate the loan application process to insure that the agency continues to meet lending demands.
The spike in FHA lending reflects “an underlying trend in demand for rental property,” explains Margaret Chadbourn, a Reuters analyst. And that demand is fueling some serious construction, with multifamily housing starts rising 7.8 percent last month. Although the FHA does not make loans directly to borrowers, it does play a major role in who gets financing because it guarantees loans made to borrowers who meet certain restrictions and requirements.
Do you think that this multifamily housing “boom” could help lift the economy or the housing market out of the doldrums?
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