Government Shut Down Impact on Real Estate

Government Shut Down Impact on Real Estate

The Federal Government shut down on December 21, 2018.  The NAR conducted a survey of Realtors to see what impacts were felt as of January 7th, 2019.  At that time 2,211 Realtors responded and indicted that 75% had felt no impact.  However, of the 25% who did feel an impact, 17% experienced a delay because of a USDA loan, 13% were unable to get IRS income verification, 9% were delayed due to FHA loans. 

This survey was done 17 days into the shutdown.


The Federal Government has been in a shutdown now over 30 days.  I believe the impacts are now further reaching because of growing fears about the state of the economy with second paychecks going unpaid and impacts to government contracts and their associated employees.  


It has been reported that Buyers purchasing homes who are relying on FHA, VA, or USDA loans are at a disadvantage to those buying with a conventional mortgage because of fears by Sellers that delays and complications are likely or imminent.  Flood insurance has been more difficult to process since the Federal Government shut down.  Borrowers obtaining necessary IRS tax return transcripts & employment verifications have also experienced delays or have had to work with lenders to navigate alternative measures.  And naturally, borrowers on mandatory furlough must return to work prior to closing on a purchase in order to use their income for qualification purposes.