New Fannie Mae multifamily head: Stars aligned for renting
The multifamily division at the government-sponsored enterprise Fannie Mae is operating with a new head. The new guy in charge, Jeff Hayward, also said he will do little to change current operations, and adds it’s a great time to be in the rental business.
"I can't say we will expand exponentially. But all the basic tenets are all together creating the perfect situation, the 25-34 (aged) demographic peaking, unemployment is dropping," Hayward tells HousingWire, adding that this age group typically rents first, then buys later. Fortunately, macroeconomics are improving and job creation will likely give his department long-term success.
"The stars are aligned, with the lowest interest rates in forever," he said. "The prospects are great for the next few years for providing liquidity, for providing financing."
Hayward is quick to add he is not knocking the single-family residential business at Fannie Mae. Nor does he recommend that Americans should rent in lieu of buying. His point, rather, focuses on the ability of his department to continue to provide multifamily financing.
In 2011, Fannie Mae provided $24.4 billion in debt financing for 2,763 multifamily loans, the largest provider of this kind of financing in the nation. The vast majority of those loans are securitized and sold to investors as mortgage-backed securities. Approximately 89% of the 422,799 multifamily units financed by Fannie Mae in 2011 were to families at or below median income levels.
It's a successful system Hayward said. "I don't really see anything that hits me in the face and says, you need to change this right now," he said. "I'm very familiar with our multifamily business, it's something I can make an impact in."
Jeff Hayward replaces Ken Bacon who retired. Bacon was with Fannie Mae for 19 years, and headed the multifamily business for 11. Hayward worked at Fannie in both single-family and multifamily divisions.