HUD just gave BTR an FHA-backed finance ‘in;’ here’s what it means

Build-to-rent (BTR) communities will now qualify for financing insured by the Federal Housing Administration under its multifamily mortgage insurance programs, the U.S. Department of Housing and Urban Development has announced.Qualifying BTR developers and acquirers will now get access to a new capital stream of FHA-insured multifamily financing for new construction, acquisitions and refinancing. This newly extended liquidity channel adds a lower-cost, longer-term source of capital with more favorable terms and higher loan amounts, a timely capital-access lifeline that could fortify current BTR projects in early development and catalyze new ones. The move comes as welcome news for a BTR business and investment sector that faced legislative uncertainty earlier this year over the scope and impact of a now-enacted institutional investor ban. By extending FHA multifamily financing to BTR, HUD is also signaling that it views single-family rental communities as a vital and enduring component of the nation’s housing supply, comparable to traditional multifamily housing. “The bottom line is it now opens up build-to-rent projects for FHA multifamily financing. It treats build-to-rent like m...