The government shutdown is hitting consumer confidence and putting pressure on household finances, according to a recent Redfin survey. Nearly half of Americans (45%) say the shutdown has made them less likely to make major purchases, such as a home or car. The report points to increasing doubts in the housing market due to economic instability that continues to shape financial decisions.
More Americans Holding Off or Canceling Major Purchases
A Redfin-commissioned survey by Ipsos shows how Americans and the U.S. real estate market are feeling the effects of the ongoing government shutdown. Since October 1, the shutdown is expected to weigh on the U.S. economy and slow growth.
The share of Americans postponing major purchases rose to 21% in November, up from 17% in early October. About 15% have canceled planned purchases altogether, more than double the 7% reported in October.
According to the survey report, there are long-term economic shocks that are causing more consumers to tighten their belts on big expenditures, and these statistics are an indication of their low confidence in the security of their jobs and finances.
Housing Payments Becoming a Growing Concern
Housing payments are also showing financial stress. Over the last three months, 7% of Americans who have monthly housing commitments have not paid their payments, and 13% of them have been late. Looking ahead, 14% predict they may miss or delay a payment within the next three months.
Rising fiscal uncertainty, combined with high living costs and inflation, is putting added pressure on both homeowners and renters.
While the shutdown is a key factor, Redfin notes that high interest rates, persistent inflation, and job security concerns are also affecting Americans’ finances. Nearly 46% of the population says that the current conditions have a significant negative impact on their lives. Together, these factors could slow activity in the housing market.
