The looming U.S. government shutdown, expected to disrupt the housing and insurance sectors, is causing concern among industry watchers. According to the National Association of Realtors, potential buyers may face difficulties in securing mortgages for properties located in flood-prone areas due to the shutdown.
Analyst Jaret Seiberg from Cowen Washington Research Group anticipates significant disruptions in home sales along coasts and rivers. This comes as climate change risks escalate, increasing the threat of flooding in these vulnerable regions.
The National Flood Insurance Program (NFIP), which provides coverage for properties at risk of flooding, is also in peril. Without intervention from Congress, the NFIP could deplete its funds by September 30. The program’s financial stability is crucial in ensuring that homeowners in high-risk areas can secure adequate insurance coverage.
Shannon McGahn, a lobbyist for the National Association of Realtors, has warned that an extended government shutdown would exacerbate these issues. Federal entities might be forced to suspend flood insurance requirements to facilitate policy transfers during the shutdown. This suspension could leave new homeowners without sufficient coverage against potential flood damage.
The potential impact of the shutdown on these sectors underscores the importance of swift Congressional action to prevent disruption in home sales and protect homeowners in flood-prone areas.
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