State Agency Moves to Protect Affordable Housing Units

LOS ANGELES-In the first transaction of its kind, Fannie Mae and the California Housing Financing Agency have struck a complex bond deal that could keep thousands of federally subsidized affordable rental units from being converted to market-rate housing.

Fannie Mae is the biggest player in the nation’s secondary mortgage market. The CHFA is a state organization established to encourage the development, purchase and retention of affordable housing in the Golden State.

As part of the complex plan, Fannie Mae sold about $274 million worth of federally backed Section 236 mortgages to CHFA. By purchasing the loans, CHFA now has the opportunity to preserve the underlying apartment buildings for affordable rental housing.