Especially vulnerable': Housing industry warns of shutdown effects

"Industry leaders warn that unless Congress acts quickly to restore NFIP, buyers and sellers in flood-prone areas could face canceled closings, higher costs from lender-placed insurance, or in some cases, the loss of financing altogether. Real estate transactions are especially vulnerable during a government shutdown, and NFIP's stability is critical to keeping the market moving, the American Land Title Association (ALTA) stated. ALTA urges Congress to act quickly to extend NFIP and protect the American dream of homeownership."

"Although most existing NFIP policies remain active and can be assumed by buyers or transferred at closing the inability to issue new policies is already creating complications. FEMA will continue to pay claims as long as its funds last, but uncertainty grows the longer the shutdown continues, NAR added. According to NAR research, the NFIP supports roughly half a million home sales annually, generating 1 million jobs and contributing $70 billion to the U.S. economy."

"Each day that passes during the shutdown, potential real-life impacts will be felt in America's housing market, which accounts for nearly 20% of the U.S. economy. That is why NAR urges Congress to reach a funding agreement to reopen the government, while we also continue to advocate for a stable, long-term reauthorization of the NFIP so that families, businesses, and markets can move forward with more certainty."

NFIP lapse during a government shutdown threatens real estate transactions in flood-prone areas by blocking issuance of new policies and risking canceled closings or loss of financing. Existing NFIP policies generally remain active and can be assumed or transferred at closing, but inability to issue new policies is creating complications and uncertainty. FEMA will continue paying claims while funds last, yet prolonged shutdown increases market risk. NFIP supports roughly half a million home sales annually, generates about 1 million jobs, and contributes $70 billion to the U.S. economy. Industry groups urge Congress to extend NFIP and reopen the government to reduce market disruptions.

Read at www.housingwire.com