Congress did not approve funding for government operations by the September 30 deadline, which caused a partial government shutdown beginning at midnight. While not every program is affected, many federal housing and mortgage services have been suspended or slowed because of the lapse in funding.
National Flood Insurance Program Halted
The National Flood Insurance Program (NFIP) can no longer issue new policies. This puts an estimated 1,400 property transactions at risk each day. Current NFIP policies remain valid for 30 days and can still be transferred to new owners, but the uncertainty grows the longer the lapse continues.
Impact on the Housing Market
Each day the shutdown continues, its effects are likely to be felt across the housing market, which represents nearly one fifth of the U.S. economy. In addition to the NFIP lapse, government shutdowns often result in delayed IRS income verifications, slower processing of FHA and VA loans, and interruptions in federal housing program funding. These disruptions could affect hundreds of thousands of buyers, sellers, and renters nationwide, creating more uncertainty in a market already dealing with affordability and supply challenges.
NAR Advocacy Efforts
The National Association of REALTORS® (NAR) has called on Congress to extend NFIP and has launched a coordinated advocacy effort with Federal Political Coordinators throughout the country. NAR continues to press lawmakers to reauthorize NFIP and bring the shutdown to an end as quickly as possible.
NAR has updated their website with information for REALTORS to better understand the implications of this shutdown so they can be prepared for these potential affects. Click below to view the site:
