Will home sales see a post-shutdown bump?
Transactions should pick up as delayed closings are completed, but economic uncertainty may keep demand subdued. Still, purchase applications jumped last week.
Key points:
- The federal government is back in business, but backlogs remain and consumers are cautious.
- Mortgage purchase applications rose 6% week-over-week, however, which may be a sign of rising confidence now that the shutdown is over.
- With mortgage rates still relatively low and new listings up, buyers have an opportunity to jump into the market while competition is light.
Economic uncertainty continues to keep the real estate market on pause, but the end of the federal government shutdown may provide a temporary boost.
With government offices opening up again — including those overseeing home loan programs — real estate transactions may experience a bit of a bump as delayed closings get back on track, Realtor.com Senior Economist Anthony Smith noted in a statement.
But, he cautioned, "a full recovery will be a slower, weeks-long process due to accumulated agency backlogs, cautious consumer behavior, and permanent economic loss."
And it could take a while for normalcy to return, Smith added, because "there will still be a significant level of uncertainty for consumers and businesses until the longer-term appropriations are passed."
Purchase applications jump
During the shutdown, the real estate market saw little movement — Redfin reported that pending sales for the four weeks ending Nov. 9 declined year-over-year, and homes were taking longer to sell, hitting a median of 49 days (the longest stretch for this time of year since 2019, according to Redfin data).
But there were some signs of life. Mortgage applications picked up for the week ending Nov. 7, possibly spurred by indications that the shutdown was coming to an end. The Mortgage Bankers Association reported the seasonally adjusted purchase index was up 6% compared to the week before, despite a slight increase in mortgage rates. Refinance applications retreated, however, so overall applications were relatively flat.
"Based on the unadjusted purchase index for the week, this was the strongest start to November since 2022," said Joel Kan, MBA's deputy chief economist.
Mortgage rates still offer a 'real window for buyers and refinancers'
The 30-year fixed-rate mortgage averaged 6.24% this week, according to Freddie Mac's survey. That's up from 6.22% the week before, but the end-of-year rate spike that has been seen in recent years hasn't happened. A year ago the rate was at 6.78%.
With rates staying relatively low this fall, some buyers may be incentivized to make a move, according to Lisa Sturtevant, chief economist at Bright MLS.
"Uncertainty is now a double-edged sword in the housing market," Sturtevant said. "While economic concerns and declining consumer confidence have held many buyers back this year, the outlook for continued uncertainty in 2026 might be leading some buyers to get into the market now to take advantage of rate drops and more inventory."
Samir Dedhia, CEO of One Real Mortgage, says consumers should be prepared to act, because "this rate environment offers a real window for buyers and refinancers."
"As the Fed reiterated last month, future moves will be data-driven. So staying alert and being ready to move when the timing is right could make all the difference," Dedhia added.
New listings mean more opportunities for buyers
While inventory is likely to stay relatively flat during the winter holiday season, it's currently up 6.3% compared to a year ago, while new listings are up 3.4%, according to Redfin.
"For people who can afford a home now, they may consider jumping into the market while competition is low and many sellers are willing to negotiate on price or offer concessions like funds to cover closing costs," said W.J. Eulberg, a Redfin Premier agent in Milwaukee.