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How a Government shutdown could disrupt flood insurance on Cape Cod

Posted by REEF Cape Cod's Home Builder on Tue, Sep 30, 2025
REEF Cape Cod's Home Builder

A government shutdown could have serious consequences for Cape Cod residents, especially when it comes to flood insurance. The National Flood Insurance Program (NFIP), which provides most of the flood insurance policies on the Cape, is at risk of lapsing if Congress fails to pass a spending bill. This could leave many homeowners and home buyers in a difficult position.

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A lapse in the NFIP would mean that no new flood insurance policies could be written and no existing policies could be renewed. This would have an immediate and significant impact on the Cape's real estate market. Many home sales would likely be delayed or even canceled, as flood insurance is required for mortgages in high-risk areas.

The economic impact of a shutdown could also be significant. The National Association of Realtors estimates that a lapse in the NFIP could disrupt thousands of home sales across the country every day. On the Cape, where the real estate market is a major economic driver, the impact could be particularly severe.

In addition to the immediate impacts on the real estate market, a lapse in the NFIP would also create uncertainty for homeowners. With hurricane season upon us, the last thing that Cape Cod residents need is to be worried about whether their flood insurance policy will be valid.

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Here are some of the key impacts that a government shutdown could have on the NFIP and Cape Cod:

  • No new flood insurance policies will be issued, and existing policies will not be eligible for renewal.

  • Real estate transactions in flood plains will be frozen.

  • The NFIP's ability to borrow from the U.S. Treasury will be significantly limited, which could impact its ability to pay claims in the event of a major disaster.

Cape Cod is a beautiful place to live, but it is also a place that is vulnerable to flooding. That is why it is so important to have a strong and stable National Flood Insurance Program. A government shutdown would put that program at risk, and it would put Cape Cod residents at risk as well.

FLOOD RESISTANT HOMES

Many inquiries we receive for new construction or renovations on Cape Cod are for properties within FEMA flood zones. Homeowners must be aware that building in these designated A, AE, AO, or V zones is subject to strict design and construction regulations that can significantly alter the original concept for their home.

If you want to know if your home is in a FEMA Flood Zone - Click Here to enter your address and find out!

With the constant uncertainty surrounding federal programs, we believe the most sensible and permanent precaution is to design and build a resilient, flood-resistant home. REEF Builders has vast experience in this specialized area, creating custom homes on Cape Cod that are engineered to meet and exceed coastal building standards, providing peace of mind no matter the situation in Washington.

FEMA Substatial Improvement

Download your FREE Guide to Permitting and Building your Custom Home  on Waterfront and Coastal  Property on Cape Cod here


Source: National Flood Insurance Program is set to expire Tuesday, halting new policies and some home loans - Newsday

Tags: Construction Costs, Cape Cod Real Estate, FEMA flood maps, FEMA flood zones, Home Design, House Design, Cape Cod Design Build, Hurricane, How to build a custom home on Cape Cod, flood insurance

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