Shutdown Over, But Real Estate Not in Clear

President Donald Trump signed a short-term spending bill Monday evening to reopen the federal government after a three-day shutdown. Earlier in the day, the House and Senate passed the bill to avert the complications of a longer shutdown, but lawmakers must pick up the debate again in about three weeks. The spending bill funds the government only until Feb. 8, when another shutdown is possible if Congress doesn’t pass a long-term budget before then.

“We are pleased that members of Congress were able to come together to extend short-term funding for the federal government and end the shutdown, which, thankfully, will have only a minimal impact on real estate transactions,” Elizabeth Mendenhall, president of the National Association of REALTORS®, said in a statement. But if another shutdown occurs after the three-week deadline for longer-term government funding, here’s what could happen to real estate.

  • Some home sales, such as new construction in special flood hazard areas, could see a delay because the National Flood Insurance Program won’t be able to issue new policies or renew existing policies during the shutdown. However, most transactions involving homes with existing policies won’t be affected because their policies will transfer over to the new owners. Existing policies that expire during the shutdown won’t be affected for 30 days. There will be no impact on homeowners filing flood insurance claims; they will get processed as usual. “Following this shutdown, we strongly urge Congress to speed passage of legislation to reauthorize and reform the National Flood Insurance Program for a longer term and end the uncertainty of the current stopgap approach,” Mendenhall said.
  • Home sale transactions involving FHA mortgage insurance should proceed without interruption. The agency can continue to endorse new insurance commitments, although processing could take longer because of staff shortages. Commercial investment projects using FHA multifamily insurance will face delays, because the agency won’t make new insurance commitments for those projects during the shutdown.
  • All mortgage transactions, including those involving conventional mortgage financing, could face longer processing times simply because of staff shortages at the IRS, notably those who process mortgage lenders’ requests to verify applicants’ tax returns and Social Security Administration staff who verify social security numbers.


“Shutdown Over, But Real Estate Not in Clear.” Realtor Magazine, 24 Jan. 2018,