Housing Bond Issuance Increased Again in 2017, CDFA Survey Says

Private activity bond (PAB) issuance increased at least nine percent from 2016 to 2017, according to the Council of Development Finance Agencies’ (CDFA) latest Annual Volume Cap Report for 2018. The report, released earlier today, presents data on how states allocate and utilize their private activity bond (PAB) cap each year. For the first time, each state submitted information for the survey, though several states provided only partial data.

According to the report, total PAB issuance was $24.9 billion in 2017, a 22 percent increase from just under $20.4 billion in 2016.  However, last year’s report did not include data from Illinois, traditionally an active PAB issuer, leading to an uneven year-to-year comparison. Removing Illinois’ PAB issuance from the 2017 data shows a 9.4 percent increase in PAB issuance from 2016 to 2017.

Similar to previous years, Housing Bonds, including single-family Mortgage Revenue Bonds (MRBs) and multifamily bonds, made up the bulk of PAB issuances in 2017. The report finds that state and local governments issued nearly $21 billion in Housing Bonds in 2017, up 12 percent from $18.4 billion in 2016. Housing Bonds accounted for just over 84 percent of total PAB issuance in 2017. This is the fourth consecutive year Housing Bonds have made up at least 80 percent of all PABs issued.

Nearly three-quarters of Housing Bond issuance in 2017 was multifamily bonds, which increased nine percent from $14 billion to $15.3 billion. MRB issuance surged 27 percent in 2017, to $5.67 billion from $4.47 billion. Mortgage Credit Certificate issuance was $6.74 billion in 2017, a very slight increase from $6.65 billion in 2016.

NCSHA discussed the report’s findings, particularly the MRB increase, in a recent Bond Buyer article (subscription required).