Federal housing programs have picked up where they left off after President Donald Trump signed a bill ending the longest government shutdown in U.S. history. The government’s new funding agreement ensures that housing programs will continue, including extending the National Flood Insurance Program’s authority to provide flood insurance through Jan. 30, according to a report by the National Association of Realtors.
The funding bill also ensures the U.S. Department of Agriculture (USDA) and Veterans Affairs (VA) loan programs, used for farm loans, home loans for veterans, and other purposes, continue to receive funding.
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“This agreement brings programs critical to housing back online and is welcome news for Americans whose home purchases and insurance renewals have been delayed or derailed over the past several weeks,” Shannon McGahn, chief advocacy officer and executive vice president of the National Association of Realtors, said in a statement.
Impact of the shutdown on housing programs
During a government shutdown, many government departments, including the USDA, temporarily stop operations due to lack of appropriated funding. Since Oct. 1, the USDA stopped issuing new home loans, both direct loans and guaranteed loans. If someone already had a loan closing scheduled, that closing was postponed until the government reopened.
The Federal Housing Administration (FHA) and VA home loans do not completely stop during a government shutdown; however, processing times slow down because of reduced staffing.
NAR led a large-scale effort to pressure Congress to end the closure, saying it was having a serious impact on housing, buyers, and the U.S. economy. According to NAR, since real estate makes up nearly 20% of the U.S. GDP, each day the government stayed closed caused economic problems, including home sales and transactions being delayed or canceled, mortgage closings being postponed, and federal housing programs being paused.
NAR advocacy efforts during the shutdown
NAR began advocating before the shutdown by sending out a “Call for Action,” asking for political coordinators to contact Congress and stress the importance of the National Flood Insurance Program (NFIP) for homeowners.
In October, NAR lobbied for reopening and protecting the housing market. The association gathered over 600 firsthand stories from real estate agents across the country describing home sales that fell through, buyers who couldn’t complete purchases and families stuck waiting because of shutdown-related delays.
NAR’s Washington team held over 80 high-level meetings with key congressional leaders and committee chairs, including the speaker of the House, Senate leaders and chairs and ranking members of committees overseeing financial services and housing. They also coordinated closely with senior staff in these offices.
“There is a six-week backlog with many of these programs, so I would expect there to be some additional delays as they work through them,” McGahn said, as reported by NAR.
