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Creating New Opportunities For Americans To Buy Green Homes

Ed. Note: This is cross-posted from the U.S. Department of Housing and Urban Development

This week, HUD partnered with the White House to host a Green Mortgage Appraisal Roundtable with national leaders from the lending, realtor, homebuilding and appraisal industries.

The roundtable discussion was an initiative of President Obama’s Climate Action Plan and one more step in a series of actions the Administration is taking to accelerate the adoption and use of energy efficient improvements in single-family homes. The event highlighted actions both the Federal government and industry can take to achieve market transformation in this area. We discussed ways that industry leaders can address key challenges when valuing high performance, energy efficient single-family homes and improvements.

For many Americans, this is a key “pocketbook issue.” According to the National Association of Realtors’ Annual Home Buyer/Seller Profile, 87 percent of people surveyed said a home’s heating and cooling costs were “important” or “very important.”

There has been a substantial increase in interest in energy efficient or green homes – as well as solar energy – in America. Energy Star Certified Homes now account for as much as a third of all new homes and the number of homes built to such green standards as LEED for Homes, Enterprise Green Communities Criteria, the National Green Building Standard, and regional or local certifications, continues to grow.

With help from Administration programs at HUD and the Department of Energy, the industry has been working to meet this rapidly growing demand. Between 2009 and 2012, more than 1.25 million existing homes were upgraded to improve their energy efficiency.

We are also expanding the toolkits of consumers and the housing industry to make sure energy information is being shared. The Department of Energy’s Home Energy Score offers a “miles per gallon” type rating that can easily be applied to homes across the country. The Federal Housing Authority (FHA) has made significant progress in updating existing policy for its energy efficient mortgages. These steps include:

• Making it easier to use the FHA PowerSaver program for home energy retrofit loans;
• Updating the FHA energy efficiency policies, including solar and wind technologies, weatherization and the Energy Efficient Mortgage;

And the housing industry has also taken key steps to help homeowners better understand the quality of energy efficient homes. Qualified assessors now score homes on a scale of 1 to 10 and provide recommendations for cost effective efficiency improvements. A growing number of Multiple Listing Services include green data fields and toolkits in their markets. Appraisers are also developing energy efficient appraisal reports, tools, and training that have the potential to catalyze the industry.

Early evidence is showing that these are not only smart investments for long-term cost savings and our environment, but they are also having “contributory value” for homeowners. A recent study by the University of North Carolina with IMT showed that loans on Energy Star Certified Homes are a good bet - foreclosure rates are one third lower than non- Energy Star homes.

The roundtable was also an important forum for assessing the barriers to accurate and reliable valuation of energy efficient or green homes, and identifying actions financial institutions, government agencies, builders, appraisers, and realtors can take to support these efforts. Working together with the housing industry, we can improve the way American’s buy their homes, save middle-class families money, and help preserve our environment.

Carol Galante is the Federal Housing Administration (FHA) Commissioner and Assistant Secretary for Housing and Harriet Tregoning is the Director of the Office of Economic Resilience.

Preparing Now for Our Climate Future

Our climate is changing.  We are not just seeing global increases in air and ocean temperatures, we are seeing changes across the United States:  extended periods of unusual heat, a greater number of heavier downpours, more severe regional drought and wildfires in parts of the American West, permafrost thawing in Alaska, ocean acidification, and sea-level rise threatening coastal communities.  At the same time, much of our Nation’s infrastructure has been designed for the climate that we have had, and not the changing climate we now are experiencing and can expect in the future. 

President Obama believes we have a moral obligation to future generations to leave them a planet that is not polluted and damaged.  That’s why, last year, he launched a comprehensive Climate Action Plan to reduce the carbon pollution that contributes to climate change, prepare for the impacts of a changing climate on American communities and businesses, and lead international efforts to address this global challenge.

Even as we act to reduce carbon pollution, we know some impacts of climate change are already unavoidable. The Federal Government has an obligation to support American communities by protecting critical infrastructure and natural resources, advancing science that informs planning and investments, establishing policies that promote resilience, and ensuring that Federal operations and facilities continue to protect and serve citizens in a changing climate. The President’s Climate Action Plan prioritizes this work and integrates consideration of climate impacts and risks into Federal programs so that we are making the best possible use of our taxpayer dollars.

In his Budget Request for Fiscal Year 2015 being transmitted to Congress today, President Obama is following through on those commitments and taking a wide range of steps to “up our game” in promoting preparedness for, and resilience against, the impacts of climate change.  This includes robust support for State, local, and tribal preparedness efforts, analysis of vulnerabilities of critical infrastructure, creation of incentives to address those vulnerabilities, and development and dissemination of better information and planning tools.