U.S. Housing Market Beginning to Pick Up
After a 16-day standoff, the United States government ended its federal shutdown. The Senate and the House passed the legislation around 10:15 p.m. on Wednesday night. The deadline for when the government’s ability to borrow money would have expired was at midnight.
With federal agencies slowly returning to normal, the nation’s housing market can pick up where it left off in its recovery. During the shutdown, many organizations had to put their daily operations on hold, and this seriously hindered some federal loans from being decided. Officials were unable to look up information on potential borrowers’ histories, which prevented some housing loans and mortgages from being decided.
Mike Fratantoni, Mortgage Bankers Association vice president of research and economics, told NBC News earlier in the week that the government shutdown had a “notable impact” on the housing market.
“Purchase applications for government programs dropped by more than 7 percent over the week to their lowest level since December 2007, and the government share of purchase applications dropped to its lowest level in almost three years,” he said.
National Association of Home Builders chief economist David Crowe agreed, saying that home builders and consumers “took pause” during the entire situation. With the timing coinciding with a spike in mortgage interest rates, it makes sense that individuals and organizations were feeling uncertain.
As government workers who were furloughed can return to work, and agencies can once again begin processing loans, more potential home owners could start to look into making a buy. Whenever there is possibility of a new account opening, financial organizations must ensure they have strong loan management software to handle each borrower’s payment plan accordingly.