Fannie Mae and FHA have made green multifamily housing financing more attainable. Sustainable features will now be a deciding factor in underwriting and interest rate calculations. Three new programs offer rate incentives for new construction and renovations. The financing options come on the heels of several reports that highlight the mutually beneficial relationship between sustainability and multifamily housing. Eco-conscious multifamily properties receive lower utility bills and fewer defaults. Energy saving tools, such as Energy Solutions, can cut costs by identifying leaks, recovering overage costs, and automating both energy management and utility billing. Convergent billing alone improves utility cost collection by 20 percent. Additionally, lower utility bills are believed to attract more stable tenants. By reducing utility costs, residents will be better able to pay rent and less likely to default. HUD Secretary Julián Castro reports that a quarter of renters spend more than 50 percent of their income on housing. The recommended allocation is 30 percent or less. Energy cost savings and decreased defaults make green properties more profitable for lenders. In order to receive a lower interest rate with Fannie Mae, properties must cite a 20 percent savings on energy or water costs. Such properties can receive up to 40 basis points off of standard pricing, reports CBRE. Especially for multifamily affordable housing, Fannie Mae’s Green Preservation Plus (formerly known as Green Refinance Plus) offers 4-5 percent greater loan proceeds. The additional funds may be used to pay for energy efficient retrofits and upgrades. There is no limit or cap on loan sums, though loans over $50 million will require HUD consent. Qualifying properties must be at least a decade old. Energy- and water-saving improvements must equal at least 5 percent of the original mortgage loan amount. Borrowers are also required to track...

After several years of reporting housing shortages and funding restrictions, there is a break in the clouds for affordable and Low-Income Housing Tax Credit (LIHTC) housing. The respite could not have come at a better time, other than sooner. The National Low-Income Housing Coalition recently released its 2016 report. The nation faces a shortage of 7.2 million affordable housing and available rental units. That means that there are only 31 affordable and available rental units for every 100 eligible households. Of those that can find housing, one in four spend more than 50 percent of their monthly income on rent. Those figures only partially influence the increase in available funding for the sector. Borrowers are now seeing an increase as banks loosen their purse strings to honor Community Reinvestment Act requirements. In 2015, Fannie Mae reported a total lending volume of $42.3 billion for affordable projects. Changes in product offerings are partially responsible for the increase in competitive loans. One new product is the Reduced Occupancy Affordable Rehab (ROAR). ROAR allows Frannie Mae to extend financing for qualified affordable housing properties in need of renovations, eliminating the need for a construction loan. Across the U.S., newfound funding is helping some companies expand their services. Affordable Housing News reports that the National Development Council Corporate Equity Fund (NDC CEF), for example, has raised $70 million for its fully specified Fund XII. The organization can now expand its products to include investment and low-income communities. With the funding, NCD CEF launched 12 LIHTC projects. The projects will include affordable housing for families, the elderly, those with special needs, and residents who require consistent assistance. The good news continues as Congress re-examines the cap on LIHTC. According to an article in Affordable Housing Finance, Sen. Maria Cantwell...