Our country could be building better quality homes, but we aren’t. Why not? The number of new homes built has risen steadily in the past 5 years, and continues to do so. Unfortunately, most of these homes will be built to meet the current building code, and not much better. Perhaps the worst news is that many of the people buying these homes don’t know that they COULD have a house that cost less to heat and cool, is more comfortable, is more durable, and provides a healthier environment for their families, at less total cost than a similar code minimum house. We know how to design and build houses like these, and in fact we have for quite a while now. So why don’t we? According to Kevin Ireton of Fine Homebuilding Magazine, there are three core reasons.
Cost is not one of those reasons. Money is part of the story, but the problem has much more to do with the way homes are financed than it has to do with actual dollars spent by the homeowner. In fact, according to a U.S. Department of Energy comparison from October of 2015, a homeowner in our climate zone would save $43/month if they built a new home to the Zero Energy Ready Home standard than if they built a similar home using the current Ohio Residential Code energy standards 1. But money can still be a problem because of the way appraisals are done.
Most banks and real estate appraisers place NO value on extra insulation or photovoltaic panels on the roof. Zero. None. Appraisals are important because they are how banks decide whether a buyer will be able to make the payments on a mortgage. Unfortunately, the factors currently used in making that evaluation do not take energy costs into account. They consider principle, interest, taxes, and insurance, but not utilities. Since energy costs are more expensive than either taxes or insurance, this is omitting a key part of the real-world accounting that affects the ability to make that monthly mortgage payment. In addition,
the basic education required for an appraiser’s license does not cover high performance home features or renewable energy. Combine these two items with the fact that in most areas it is difficult to find houses with “comparable” energy efficiency features, and it becomes very difficult to get a mortgage that recognizes the added value of a high-performance home.
This is a shame, because when it comes time to re-sell that home, the buyers will recognize this value. According to a McGraw Hill Smart Market Report 2, 73% of single family home builders say consumers will pay more for green homes.
The unique nature of the home building industry is another reason home quality hasn’t advanced faster. Building science based solutions for homes are not “one size fits all”. While a computer can be designed so it works just as well in Phoenix as in Boston, homes need to take climate into account. A wall assembly that makes perfect sense in a hot, dry region is not at all appropriate in northeast Ohio. Even if the best strategies were the same for the whole country, there are roughly 60,000 home builders in the U.S. and there is no single organization, tradeshow, or conference that reaches all of them with the latest information.
According the NAHB Research Center, it takes up to 25 years for the housing industry to adopt new technologies.3 The details matter in high performance homes, but there is very little incentive for builders to learn these new methods. Only eight states have continuing education requirements for contractor licenses. In Ohio, general contractors for home construction are not required to be licensed by the state at all, and the cities that do require licensing are more interested in making sure the business will be around to complete the project than finding out if they know anything about construction. Many contractors do in fact know a great deal about construction, and there is a lot to know. They need to schedule work, order materials, find skilled labor, pay for insurance, market the company, and more. Adding to their challenge is the fact that many prospective homeowners are focused on getting a low cost-per-square foot, focused completely on the initial construction cost because of the lending system. As a result, contractors are apt to stay close to the “tried and true” construction methods they know, so they can focus on these other challenges.
So, there is no system in place for getting the latest information on building science into the hands of builders, and little incentive for them to adopt new practices that add yet more complexity to what is already a very complicated and competitive business. Which brings us to the final reason we aren’t building better houses.
“Because consumers haven’t asked us to.” This is according to C. R. Herro, the VP of environmental affairs for Meritage Homes, one of the country’s largest home builders. People don’t buy homes very often, and when they do they typically have a lot of other things going on in their lives. They don’t have time to do a lot of research, and so they rely heavily on the advice of bankers, home builders, and people who own houses that were built many years ago. We’ve just covered the reasons bankers and builders are not apt to champion the cause of high performance homes. With competition so high, it is important that we as consumers learn to ask the right questions, expect the high performance that is completely attainable, and make energy efficiency one of the things contractors need to compete on.
So let’s start asking! Ask builders for high performance homes, and insist that lenders take the costs of energy use for a house into account when they figure mortgage amounts. For starters, every house should have a blower door test done during construction to check for air leaks. Next, ask for the HERS score for your new home. You would buy a car without knowing how many miles per gallon it gets, why would you buy a home without knowing how it performs compared to a code minimum house? Likewise, you expect to see drawings showing what the house will look like when it is built, and perhaps even a CAD model so you can see it in three dimensions. It is perfectly reasonable to expect computer modeling of how much energy the house will use. Energy modeling can be used to help make cost effective choices about insulation levels and heating and cooling systems.
Even if you aren’t interested in getting your home certified to a sustainable construction standard like LEED, the National Green Building Standard, or Passivhouse, you can these standards as guideposts for learning about high performance home construction. The U.S. Department of Energy has its own program, Zero Energy Ready Home certification. Their website includes the “Tour of Zero”, where you can see dozens of high performance homes and their construction details. I’ve included a link to this site below. The Zero Energy Ready Home is specifically geared towards investing in a home’s thermal envelope to the point where it will be able to generate as much energy as it uses with the addition of solar photovoltaic panels. The solar panels don’t need to be added at the time of construction. These are easy to add on later, while changes to the building enclosure are much more difficult. Quite a few of these Zero Energy Ready certified houses have already been built in northeast Ohio.
Let’s raise the bar and expect the construction of our new homes to give us better comfort, energy efficiency, and air quality. We know how to do it. It will save us money. Let’s move forward together and make it happen!
This post draws heavily from Kevin Ireton’s article, “Why Don’t We Build Better Houses” in the spring/summer 2017 Houses issue of Fine Homebuilding magazine. If you’d like a copy of the original article, send me an email and I can send you the pdf. Or if you like audio you can find the Why Don’t We Build Better podcast here.
Click here for more information on the U.S.Department of Energy’s Zero Energy Ready Home program.
To tour some homes already built using the Zero Energy Ready standard, see this page: DOE Tour of Zero.
Another good source for information about high performance home building is Green Building Advisor.
1) Department of Energy Zero Energy Ready Home Savings & Cost Estimate Summary
2) McGraw Hill Construction Smart Market Report