As we know, not ALL government agencies shut down. For example, those “non-essential” agencies, such as those needed to ensure public safety, remain open.
For most of us, government agencies related to real estate are not essential…
Rather than listing the real estate related effects of (this) a shutdown myself, I’ll leave it to the Wyoming Association of Realtors (Iam a member of both the Idaho and Wyoming Associations since I try to sell real estate in both Teton Counties).
There are three areas of concern for your business: 1) the availability of federal flood insurance under the National Flood Insurance Program, 2) delays in processing of FHA-backed mortgages, and 3) slower response times by IRS offices for tax information needed for real estate transactions.
Flood insurance
Update 12/21, 8pm ET: Flood Insurance Extended Until May 31
NFIP’s authority to sell flood insurance policies expires at midnight tonight. Should the program lapse, NFIP will not be able to sell or renew policies. Existing NFIP policies will remain in effect until their expiration date.
NAR FAQ Sheet: Flood Insurance Extension Update(link is external)
FHA programs
Under a shutdown, FHA will furlough non-essential employees. Delays are possible in loan processing and approval. Mortgages backed by secondary mortgage market companies Fannie Mae and Freddie Mac are not affected, nor are mortgages backed by the U.S. Department of Veterans Affairs.
Tax information
To the extent taxpayer information from the IRS is needed, transactions can face delays as IRS offices, subject to furloughs of non-essential employees, take longer to reply to requests.
