U.S. Federal Housing is increasing the multifamily caps at Fannie Mae and Freddie Mac for 2026 by over 20% compared to this year, a level which keeps pace with volume growth in recent months, observers said.

The combined cap of $176 billion is split evenly between the two companies at $88 billion. This year’s cap set by the agency formally known as the Federal Housing Finance Agency was $146 billion or $73 billion for Fannie Mae and for Freddie Mac.

Through October, Fannie Mae has done $54.7 billion and Freddie Mac $55.7 billion according to Jade Rahmani, an analyst at Keefe, Bruyette & Woods. This is an increase of over 42% for Fannie and 27% at Freddie.

October production of $6.7 billion at Fannie Mae and $8.4 billion at Freddie Mac added to the first three quarter results suggests “room for a strong finish to the year” at the GSEs, Rahmani said.

“The FHFA’s 2026 multifamily lending caps send a positive signal about anticipated origination volumes…as the caps are in line with current monthly volumes (October’s $15.1 billion equates to $180 billion annualized), suggesting growth in 2026 accounting for 1Q seasonality,” Rahmani said.

In its announcement, FHFA said it will require at least 50% of the GSE multifamily business be “mission-driven, affordable housing.”

Workforce housing is excluded from these limits, as it was in 2025, the announcement said.

“FHFA anticipates the $88 billion cap to be appropriate given current market forecasts,” an accompanying document from the agency said. “However, FHFA will continue to review its estimates of market size and mission-driven minimum requirements throughout the year.”

It also said if the market is smaller than anticipated during 2026, the agency will not reduce the size of the caps.

The other sections of the document do a deeper dive on what qualifies as mission-driven.

This increase aligns with the Mortgage Bankers Association’s expectations for the multifamily market next year, said Bob Broeksmit, president and CEO, in a statement.

“Stable market conditions, strong maturity volumes, and a gradual decline in interest rates are expected to lift multifamily lending activity next year,” said Broeksmit. “The announced cap levels will help ensure the GSEs remain a reliable source of financing for rental properties, including those serving lower-income households and rural communities.”

Besides serving as FHFA director, Pulte is the chairman of both Fannie Mae and Freddie Mac.

“Fannie Mae remains committed to providing dependable liquidity and innovative solutions that support the multifamily housing market in America,” Kelly Follain, executive vice president and head of multifamily at Fannie Mae said in a statement. “U.S. Federal Housing’s 2026 multifamily loan purchase cap will enable us to continue this important work, ensuring people have access to quality, affordable places to live in communities throughout the country.”

A similar response came out of Freddie Mac.

“Freddie Mac Multifamily delivers essential liquidity to create affordable apartment supply around the country each and every year,” said Kevin Palmer, head of multifamily, in its statement. “In 2026, we will continue to provide that needed liquidity with our full suite of offerings and continued innovation.”