Published: Jun 28, 2010 10:45 PM EDT
Updated: Jun 28, 2010 7:47 PM EDT

LEE COUNTY, Fla. - Just as the housing market is stabilizing buyers and sellers are now caught in a holding pattern waiting for insurance. It's because Congress hasn't approved a new FEMA flood insurance plan that expired in May.

Most homeowners in Southwest Florida are required to carry flood insurance, but for the past few weeks the government hasn't been selling it.

One home has been on the market for three years and the price has been reduced by half. Now, it finally has a buyer, but the South Fort Myers house is in a flood zone and the National Flood Insurance Program expired almost a month ago.

"It's very inconvenient. All the paperwork is in place. Their loan is in place. I'm in the process of buying another place on Fort Myers Beach and this all coming to abeyance because the government won't issue the flood insurance."

80 percent of homes in Southwest Florida are required to have flood insurance, but with no plan in place - they can't close, so buying is at a standstill - just after the foreclosure crisis.

"It's like you go through one hurdle then you have to cross over another one and it's very surprising."

Donna Mason has many clients, money in hand, just waiting.

"It's ultimately been a domino effect for everybody."

...while homeowners grow impatient.

"I'm sure it's going to close but I don't know how soon or when."

Buyers, sellers, and real estate agents hope lawmakers fix this problem and make flood insurance available later this week.

There's one way to get around all this: Pay for the home in cash.