With the House and Senate passing a bipartisan measure late Wednesday and President Barack Obama signing it early Thursday, the 16-day government shutdown ends and the U.S. avoids defaulting on its debts.
There was concern over the effects it would have on the housing recovery.
Some real estate industry and mortgage experts had predicted that if the government defaulted on its debts, it could send mortgage rates skyrocketing quickly—by one to two full percentage points.
Gary Thomas, president of the National Association of REALTORS®, testified last week before the Senate Banking Committee that a debt ceiling breach could lead to a one-percentage point increase in mortgage rates and potentially could drop homes sales by 450,000 units.
The 16-day government shutdown has taken an estimated $24 billion out of the U.S. economy, according to Standard & Poor’s estimates. After the bill was signed reopening the government, NAR released a statement warning of “residual delays in programs as workers address issues caused by the 16 day lapse,” and pledged to maintain their web page that made shutdown information available for members over the next several days as government operations return to full capacity.
The new legislation, approved by the House and Senate, will fund the government through Jan. 15.