Dive Brief:

• Builders may find that the parts of their businesses that depend on first-time buyers may be hurt if the government shutdown stretches out, causing Federal Housing Administration staff get behind on loan approvals.
• First-time buyers are the largest users of federal mortgage guarantees.
• The FHA decided to keep processing loan applications, but the staff is reduced.

Dive Insight:

How serious a risk a long shutdown—meaning perhaps a month or more—poses to home builders is debated, but both the optimistic National Association of Home Builders and the less sanguine Sterne Agee brokerage firm foresee breakdowns in the operation the longer a reduced staff has to cope. NAHB also noted that FHA is working out of leftover commitment authority from FY 2013, but it's unclear how long that will last.