The Showdown in D.C. - and Why It Matters Here In Alaska
Washington is on the brink of another “shutdown showdown.” If Congress doesn’t act by September 30, the federal government runs out of money, and the ripple effects could smack right into the housing market.
The National Association of REALTORS® (NAR) is already waving the red flag. Why? Because when the government grinds to a halt, so do a lot of programs that keep real estate deals moving. And in markets like Anchorage, Wasilla, Palmer, and Girdwood - where buyers already juggle high interest rates and limited inventory - a shutdown could add an extra layer of stress.
The Big One: National Flood Insurance Program (NFIP)
Nearly half a million home sales each year depend on NFIP coverage. Most people typically think about places like Florida and Hawaii when they think about flooding, but this still affects parts of Bootleggar's Cove and Bluff homes.
Here’s the problem: during a shutdown, NFIP can’t issue new or renewed policies. Existing ones stay valid, and regulators may temporarily suspend the flood insurance requirement so closings can limp forward. But delays, uncertainty, and risk creep into every transaction.
Bottom line: buyers should line up coverage early, or look into private flood insurance to avoid last-minute chaos.
Other Programs That Could Stall or Slow
Here’s a quick look at what else could get messy if the lights go out in D.C.:
-
Fannie Mae & Freddie Mac: They’ll keep running, but things like employment verification, tax transcripts, and flood insurance requirements might get delayed.
-
IRS: Don’t expect speedy tax transcripts, refunds, or lien releases. If your deal hinges on IRS paperwork, brace for slowdowns.
-
USDA Rural Housing Programs: Direct loans freeze. Guaranteed loans hang in limbo. Closings might move forward, but that means the lenders assume the risk. For Palmer and Wasilla buyers using USDA loans, this could be a major roadblock.
-
VA Loans: VA will still guarantee loans, but staff shortages could slow appraisals and approvals. Veterans in Anchorage might face longer wait times.
-
HUD & FHA Programs: FHA will keep insuring loans, but condo approvals, counseling agencies, and voucher programs could feel the squeeze.
-
EPA: Compliance checks (like wetlands determinations or lead-based paint enforcement) could hit pause. That means delays on certain property approvals.
-
Small Business Administration (SBA): No new small-business loans. Disaster loans continue, but everyday financing stops.
What It Means for Alaska Buyers and Sellers
-
Buyers: Expect possible delays in closing if your loan relies on USDA, VA, or NFIP. Plan ahead and get your paperwork moving early.
-
Sellers: Stay flexible. A shutdown could spook buyers or slow financing, but deals can still close with preparation.
-
Agents: Communication will be your secret weapon - helping clients understand what’s a normal delay and what’s just shutdown chaos.
The Bottom Line (Because Jacob Always Lands It)
Shutdowns are political theater, but for real estate they’re more like a bad sequel nobody asked for. Deals in Anchorage, Wasilla, Palmer, and Girdwood don’t have to die during a shutdown, but they can definitely get messier.
The best move? Stay proactive. Line up insurance early, verify paperwork twice, and keep clients in the loop. The real estate market makes up almost 20% of the U.S. economy - so while Congress argues, REALTORS® will be the ones keeping the gears turning.
