Dive Brief:
- Recently confirmed U.S. Director of Federal Housing Bill Pulte has rescinded the Biden administration’s directives on multifamily leasing policies.
- These included 30-day advance lease termination notice requirements for properties funded by Fannie Mae and Freddie Mac mortgages, according to an order dated March 24.
- Pulte noted in the order that many state and local governments already had existing laws governing notices and grace periods. “Requiring the Enterprises to incorporate additional tenant protections into all multifamily loan agreements would increase compliance burdens for multifamily lenders and property owners,” he said.
Dive Insight:
On July 17, 2024, the Federal Housing Finance Agency announced that, effective February 2025, Fannie Mae and Freddie Mac would require their borrowers to maintain certain leasing practices, including a 30-day advance notice of rent increases or lease expirations and a five-day grace period for rent payments. The announcement has since been removed from the FHFA’s website.
At the time, then-FHFA Director Sandra L. Thompson said that these changes to Fannie and Freddie mortgage agreements “reflect basic best practices to ensure housing providers effectively communicate with tenants and that tenants understand their rights and responsibilities under their leases.”
On Feb. 21, following the inauguration of President Donald Trump, the FHFA delayed the implementation of these changes until May, ahead of rescinding them entirely under Pulte’s leadership.
This rescinded requirement stemmed from the Biden administration’s Blueprint for a Renters Bill of Rights, released in January 2023. In this framework — which did not itself have the force of law — the administration outlined the principles around which it would base its housing strategy. These included:
- Safe, quality, accessible and affordable housing.
- Clear and fair leases.
- Education, enforcement and enhancement of renter rights.
- The right to organize.
- Eviction protection, diversion and relief.
The Biden administration also directed the FHFA to examine proposed actions promoting renter protections and limits on egregious rent increases for future investments. The status of this directive was not addressed in the order.
In the time since Pulte was confirmed on March 12, he has appointed himself chairman of both Fannie Mae and Freddie Mac, according to Bisnow. He has ousted four members of Freddie Mac’s board of directors, added seven new members across both boards, fired Fannie Mae CEO Diana Reid and placed many Fannie staffers on administrative leave.
The White House is also reportedly considering an executive order to study the effects of taking the enterprises private, according to The Wall Street Journal.
