# FHFA Withdraws from International Climate Network

By Opendoor Editorial Team | 2025-12-17


The Federal Housing Finance Agency has formally withdrawn from an international climate risk coordination network, marking a significant departure from the previous administration's approach to environmental considerations in housing finance regulation.

In September 2025, FHFA Director William J. Pulte announced the agency's[ <u>withdrawal from the Network of Central Banks and Supervisors for Greening the Financial System</u>](https://www.fhfa.gov/news/news-release/u.s.-federal-housing-completes-withdrawal-from-international-greening-the-financial-system-network) (NGFS), a global coalition of financial regulators focused on climate-related financial risks. The decision represents a fundamental shift in how the federal housing finance regulator approaches climate considerations in mortgage markets.

"Biden drove housing costs up with politicized nonsense that prioritized climate activists over American families," Pulte stated in the agency's formal withdrawal letter to NGFS leadership, according to the[ <u>FHFA news release</u>](https://www.fhfa.gov/news/news-release/u.s.-federal-housing-completes-withdrawal-from-international-greening-the-financial-system-network).

## **Understanding the NGFS Framework**

The Network of Central Banks and Supervisors for Greening the Financial System, established in 2017, brings together financial regulators and central banks from more than 130 jurisdictions. The network develops best practices for managing climate-related financial risks and supports the transition to sustainable economies through coordinated regulatory approaches.

For housing finance, NGFS participation involved assessing how climate-related risks—including physical risks from extreme weather events and transition risks from policy changes—might impact mortgage portfolios and property valuations. The FHFA's participation under the Biden administration represented an acknowledgment that climate change poses material risks to the housing finance system, given that Fannie Mae and Freddie Mac hold or guarantee trillions of dollars in residential mortgages.

[See Homes Near You](#)

## **Broader Deregulation Agenda**

The NGFS withdrawal aligns with Director Pulte's broader regulatory philosophy emphasizing market-driven solutions and minimal government intervention. In October 2025, the agency[ <u>requested public input on its new Strategic Plan</u>](https://www.fhfa.gov/news/news-release/u.s.-federal-housing-requests-input-on-new-strategic-plan) for FY 2026-2030, which proposes three strategic goals focused on responsibly overseeing Fannie Mae and Freddie Mac.

The new strategic direction, described as consistent with President Trump's executive orders, signals a return to what agency leadership characterizes as core housing finance functions. This approach views climate-related regulatory initiatives as mission creep that increases costs for consumers without demonstrable benefits for market stability.

## **Market Performance Context**

The policy shift comes as housing markets show mixed signals. According to the[ <u>FHFA House Price Index</u>](https://www.fhfa.gov/news/news-release/u.s.-house-prices-rise-2.2-percent-year-over-year-up-0.2-percent-quarter-over-quarter), U.S. house prices rose 2.2 percent between the third quarter of 2024 and the third quarter of 2025, with a 0.2 percent increase from the second to third quarter of 2025.

Meanwhile, the agency announced in November 2025 that[ <u>conforming loan limits for 2026</u>](https://www.fhfa.gov/news/news-release/fhfa-announces-conforming-loan-limit-values-for-2026) will increase to $832,750 for one-unit properties in most of the United States, up $26,250 from 2025 levels. The agency also set[ <u>2026 multifamily loan purchase caps</u>](https://www.fhfa.gov/news/news-release/u.s.-federal-housing-announces-2026-multifamily-loan-purchase-caps-for-fannie-mae-and-freddie-mac) at $88 billion for each GSE, totaling $176 billion to support the multifamily market.

## **Industry Implications**

The withdrawal from NGFS raises questions about how Fannie Mae and Freddie Mac will assess and manage climate-related risks in their operations going forward. Under the previous administration, both GSEs had begun developing frameworks for evaluating climate risks in their mortgage portfolios, including analyzing geographic concentrations of climate exposure and assessing property insurance adequacy in high-risk areas.

The policy shift creates potential tension between the FHFA's deregulatory approach and the GSEs' responsibility to manage portfolio risks prudently. Even without regulatory mandates, the enterprises face market pressures to understand and disclose climate-related exposures, particularly as private investors increasingly demand climate risk information.

The decision also has implications for international coordination on housing finance regulation. As climate-related financial risks increasingly cross borders, the U.S. departure from NGFS creates potential for regulatory divergence, with American housing finance operating under different frameworks than comparable systems in Europe, Canada, and other developed economies.

[See Homes Near You](#)

## **Looking Ahead**

For real estate professionals and housing finance stakeholders, the policy shift creates both opportunities and uncertainties. Reduced regulatory focus on climate considerations may ease compliance burdens and expand lending flexibility in some markets. However, it also places greater responsibility on individual market participants to assess and manage climate-related risks without standardized frameworks or regulatory guidance.

As Director Pulte continues implementing his vision for a streamlined, market-focused FHFA, the housing finance industry will be monitoring whether this approach proves adequate for managing long-term challenges related to climate impacts on property values, mortgage performance, and financial stability. The stakes extend beyond housing policy to affect millions of American families whose homes represent their largest financial asset and whose mortgages are ultimately backed by taxpayers through the GSE system.

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*Originally published at [https://www.opendoor.com/articles/fhfa-withdraws-from-international-climate-network](https://www.opendoor.com/articles/fhfa-withdraws-from-international-climate-network)*

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