Going Green: Upgrade or Buy New?
Posted by Steve Kleber on Jun 01, 2011
Welcome to the Kleber & Associates blog! Here’s the latest on Going Green: Upgrade or Buy New?
In efforts to steer the US toward a more environmentally friendly and sustainable future, President Obama’s administration has implemented programs and initiatives to encourage both businesses and homeowners to embrace sustainable practices and technologies. Recently the federal government took another step toward encouraging homeowners to upgrade their homes by announcing the new PowerSaver program through the FHA. The program will allow homeowners to borrow up to $25,000 to make energy improvements. Fannie Mae’s new Energy Improvement feature for mortgage loans is very similar to the government’s program. Both programs encourage homeowners to replace doors and windows, HVAC systems, water heaters, insulation and duct sealing for more energy efficient products and technologies like solar panels and geothermal systems.
Home builders are concerned that the new programs only encourage revamping existing homes and don’t encourage consumers to purchase new energy efficient homes. Fannie Mae has ended its Energy Efficient Mortgage that allowed home buyers to finance energy efficient homes, but the federal government still has its Energy Efficient Mortgage program intact. Home building company Meritage is concerned that appraisers and banks are not accurately recognizing the value of energy efficient features when reviewing mortgage applications, making it more difficult for consumers to purchase new energy efficient homes. While HUD representatives believe the value of energy efficiency in new construction is being recognized by local building codes and appraisers, Meritage believes the new PowerSaver program gives consumers even more reason to stay in their existing home rather than buy a new one.