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Although the Senate this evening passed a spending bill to fund the vast majority of the federal government through Sept. 30, 2026, a partial government shutdown will go into effect at 12:01 a.m. on Saturday, Jan. 31, because the House is not expected to return before Monday, Feb. 2. Moreover, it is still unclear how fast the House will vote on the funding legislation passed by the Senate.

The partial shutdown affects major parts of the federal government, including the departments of Defense, Treasury, State, Health and Human Services, Labor, Housing and Urban Development, Transportation, and Education.

The White House and Republican and Democratic congressional leaders are seeking to avoid a weeks-long shutdown like the one that occurred last fall, and the House could vote as early as Feb. 2 on the Senate legislation to keep the full government running through fiscal year 2026, with the exception of the Department of Homeland Security, which would have a two-week stopgap funding level while lawmakers negotiate changes to the agency.

In most cases, the short-run impacts of a shutdown on the housing sector will be minor. A long-run shutdown, lasting several weeks or a month or more, could have significant impacts on mortgage accessibility and reduce housing demand.

In general, ��㴫ý members should expect delays for any housing-related federal government programs that are still operating and plan accordingly. ��㴫ý continues to monitor the situation closely.

National Flood Insurance Program

Of immediate concern is the effect on the National Flood Insurance Program (NFIP):

• The authority to provide new flood insurance contracts is expired for the duration of the government shutdown. This will delay all new home sales or insurance renewals for property owners with federally backed mortgages who lie in a Special Flood Hazard Area.
• This disruption could lead to significant uncertainty in the housing market and may result in the cancellation of sales. However, flood insurance contracts entered into before Jan. 30 will continue until the end of their policy term of one year.

Although Congress has reauthorized the NFIP retroactively following most prior lapses in authorization that have occurred, there is no guarantee that it will do so in this instance. A failure to retroactively renew the flood insurance program will impact the effective date of policies that can be issued once the NFIP has been reauthorized and once again begins issuing new policies.

The Trump administration has not published updated contingency plans for agencies late Friday evening.

Compiled by ��㴫ý, the following is a list of government programs that could affect home builders and housing stakeholders under the current shutdown. The list below is based on government plans and actions currently available or on previous shutdowns, but is subject to change based on administration actions. ��㴫ý will continue to update this list as new information becomes available.

Department of Housing and Urban Development

• FHA-insured single-family loans will continue to be endorsed in the near term, although some delays in processing and closing should be expected.
• FHA multifamily insured projects with firm commitments and scheduled closings may go forward, although no new firm commitments will be issued.
• HUD will make payments under previously obligated Section 8 contracts, Section 236 agreements, Section 202 and 811 Project Rental Assistance Contracts (PRAC), and Section 811 Project Rental Assistance (PRA).
• HUD will continue to process rental subsidy contract renewals to the extent that there is budget authority available from prior appropriations or recaptures.
• NSPIRE physical inspections will only proceed a) when the servicing mortgagee is responsible for procuring the inspection; b) when funds for the NSPIRE inspection contracts were obligated before the lapse in appropriations; or c) where there is reason to believe that there is a threat to life or property at a specific location.
• CDBG, HOME and other block grant funds will be dispersed in cases where failure to address issues results in a threat to life, safety and protection of property.
• Authorized drawdowns for approved CPD program activities (homeless assistance programs, CDBG, HOME, HOPWA) using pre-FY2026 program funds will continue uninterrupted unless it is necessary for a HUD employee to approve a voucher or lift a system edit prior to a drawdown.

Department of Homeland Security

• E-Verify, the web-based system that allows businesses to determine the eligibility of their employees to work in the U.S., is unavailable due to the government shutdown. While E-Verify is unavailable, employers may not be able to access their E-Verify accounts.

Occupational Safety and Health Administration

• OSHA’s investigation and enforcement activities will be substantially reduced during the shutdown, with the agency focusing on “imminent danger” situations involving the threat of safety, life or property and other emergencies, such as catastrophic and fatal workplace accidents.

Department of Labor

• The agency will likely stop processing employers’ foreign labor certifications to access temporary workers under the H-2B program.

Internal Revenue Service

• Some lenders require home borrowers to file IRS form 4506-T to verify the mortgage applicant’s income and Social Security number. With the IRS shut down, this could result in major delays in some mortgage application approvals.
• Taxpayer services will be suspended, meaning no refunds will be issued and taxpayers will not be able to phone the IRS for advice.