🏡 How the Government Shutdown Could Affect San Mateo County Real Estate
What homebuyers, sellers, and homeowners should know right now
A federal government shutdown might sound like politics in Washington, but its impact stretches all the way to San Mateo County. For local buyers, sellers, and homeowners, it can translate into slower closings, delayed loans, and a little more uncertainty in an already tight market.
Here’s how the shutdown could affect real estate here on the Peninsula — and what you can do to protect yourself.
1. Mortgage & Loan Delays
Many loans depend on federal agencies that are directly affected by a shutdown. FHA, VA, and USDA loans may experience processing delays or even temporary halts. Even conventional loans can be slowed because lenders often rely on federal data for income and identity verification — for example, IRS tax transcripts or Social Security checks.
If those systems go offline, lenders can’t finalize underwriting, and closings may get pushed back.
What to do:
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Stay in close contact with your lender and escrow officer.
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Ask about backup verification methods.
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Add extra time into your contract or contingency period.
Even a few days of delay can make a difference in a competitive market like San Mateo County, where closing schedules are often tight.
2. Flood Insurance Uncertainty
If the National Flood Insurance Program (NFIP) lapses during the shutdown, new flood insurance policies — or even renewals — might not be issued. That’s a serious issue for homes in coastal or low-lying parts of the county, where flood insurance is often a lender requirement.
What to do:
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Check early whether your property is in a flood zone.
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Talk to your lender about whether private flood insurance can temporarily replace NFIP coverage.
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Don’t wait until the week of closing to find out — it could delay your deal.
3. Market Confidence & Buyer Behavior
Even if your transaction isn’t directly affected, the mood of the market can shift. During past shutdowns, buyers tended to hit pause, waiting for clarity. Sellers, unsure how long it would last, sometimes postponed listings or became more flexible on price.
In a high-cost area like San Mateo County, where confidence drives activity, that uncertainty could briefly cool demand — but it could also open opportunities for serious buyers.
What to do:
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If you’re buying, keep an eye out for quieter open houses or motivated sellers.
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If you’re selling, work with your agent to keep communication open and expectations realistic.
4. Local Permits & Development Delays
City and county offices will keep running, but certain projects that depend on federal approval or funding — such as environmental reviews or HUD housing programs — could face temporary hold-ups.
What to do:
If you’re planning a remodel, new construction, or development that involves federal grants or permits, plan ahead for longer timelines and check in with your contractor or local planner.
5. For Current Homeowners
If you’re not actively buying or selling, you may feel little direct impact — but some homeowners will still notice changes. Refinancing through FHA or VA programs may take longer. Renewing flood insurance might be tricky. And lenders could tighten documentation requirements if data sources are disrupted.
The good news? Most homeowners will see inconvenience more than crisis — especially if the shutdown is short.
The Bottom Line
For San Mateo County, the 2025 shutdown is unlikely to cause a full market slowdown, but it will create friction — slower paperwork, cautious buyers, and a few delayed deals.
The key is preparation. Buyers and sellers who plan ahead, communicate with their lenders, and stay flexible will be in the best position to move forward smoothly.
Even when Washington pauses, the Peninsula market keeps moving — just a little more carefully.
