The Federal Government was able to avoid a shutdown by passing a last-minute funding deal to keep the government open for 45 days. One of the keys to getting this temporary measure passed was removing the funding for Ukraine and its war against Russia. This is a short-term solution, but they were able to make happen – for now. Luckily, thousands of government workers and government contractors will not be losing their pay.

How would a government shutdown impact real estate? If someone is a non-essential government employee, they will temporarily lose pay. If they are a government contractor affected by the shutdown, they will completely lose pay. This impacts consumer confidence and lifestyle, which is the consequence that would have the largest impact. The next area of concern is those requiring flood insurance – FEMA would close during the shutdown, so closings will be delayed.

Most other areas would not be affected as much, which is good news for real estate. Freddie Mac and Fannie Mae are funded by lenders and not the government so they will be operational. The VA and FHA will also be able to respond and loans will close through them. The IRS will not be shut down so verifications will be available for lenders. Local governments won’t shut down, so title searches and recordation of transactions won’t be affected. Again, it is the psychological impact and loss of wages that will impact the market the most.

So, how is the real estate market today? Rates continue to rise so it is affecting some price points – but not all. Each market has its sweet spot but most areas continue to see good activity as well as multiple contracts. All that being said, we are seeing an increase in the days on the market, and houses aren’t jumping off the shelf like they were before. Pricing is critical today so if you are thinking of selling, let’s have a conversation. People need to buy houses despite the rates, so houses are selling. It is not all doom and gloom like the media portrays. We have just over 2,000 houses for sale in all of Northern Virginia and just a 1.3-month supply of homes. Don’t be fooled by the headlines. As always, call me to learn more – I am here to help.

Happy Fall!