Are you ready for homeownership?
The partial government shutdown, which entered its 26th day on Wednesday, is beginning to have an impact on potential home buyers in the Bradenton-Sarasota area.
Among those affected: Veterans who need a VA loan to finance a home purchase, federal workers on furlough and small business owners seeking a Small Business Administration loan.
“I am working with two people right now who are veterans. They are waiting to see what happens,” said Beth Barnett, a real estate sales associate for Coldwell Banker based at Lakewood Ranch.
“It definitely affects people’s paychecks and everything else,” she said. “Before they can get their loan, they have to get the VA appraiser out. They have to take a different approach than someone getting a conventional loan. It’s hard to get the appraiser out now, and they are on hold. It’s a feeling of anxiety about what’s coming.”
Amy Worth, 2019 president of the Realtor Association of Sarasota and Manatee, said that buyers don’t like economic uncertainty.
“The government shutdown can be a cause for hesitation among buyers, especially if there are no clear signs of when the shutdown might end,” Worth said.
“For the most part, the only real impact is on federal workers without pay and those using USDA loans and loans that aren’t currently operating. Fortunately, most conventional loans are still closing and FEMA continues to issue and renew flood insurance policies.”
Joanne Owens, broker/owner with Keller Williams on the Water in Bradenton, said she knows of two potential buyers who are directly affected by the shutdown.
But concerns extend much wider.
“Buyers who are not directly affected are very concerned about the fallout when the government gets back to work. Some have put their purchasing on hold for another year,” Owens said.
The two buyers Owens knows who are directly affected by the shutdown are federal employees who are on furlough.
“They are concerned by the state of the financial situation and have put their purchase on hold,” Owens said.
January is traditionally one of the busiest real estate sales months of the year in the Bradenton-Sarasota area, where many of the sales are cash deals.
“I haven’t personally experienced that,” Glenda Matheson, a Realtor associate with Realty Partners of Lakewood Ranch, said of the effect of the shutdown on home sales. “I have closings but it is not impacting them at all.”
Janet K. Robinson, commercial director for Florida West Coast Coldwell Banker Commercial NRT, said the shutdown is affecting Small Business Association loans.
SBA loans only require businesses to put 10 percent down, helping them to maintain more liquidity, she said.
“It does affect small businesses even if they are financing an improvement. It has put a lot of strategic planning on hold,” Robinson said.
The SBA announced that it was going dormant Dec. 22 on Facebook: “Due to the lapse of government funding, SBA will remain inactive until further notice. We apologize for any inconveniences and we look forward to assisting you when we return. For updates, visit sba.gov/shutdown.”
Also affected by the partial government shutdown is fund investment in designated opportunity zones, including several in Manatee County.
Because of the shutdown, the federal government canceled a public hearing on tax breaks available to funds that invest in economically depressed areas.