TRENTON - New Jersey residents displaced by Sandy may now stay in hotels paid for by the federal government until Jan. 26.  

The temporary shelter assistance program was set to expire on Saturday, but has been extended for two weeks.

Officials with the Federal Emergency Management Agency (FEMA) say that the number of people relying on the program is dwindling.

According to FEMA, roughly 5,400 households have used the agency's temporary housing program since Nov. 1. Right now, less than 2,800 households are in the program. That number is expected to drop to around 1,100 by Saturday as more Sandy victims are finding longer-term housing options.

The program in New Jersey has cost more than $17 million so far. FEMA officials say the average stay is 25 days.

AP Wire Service contributed to this report .