BuilderBob'sSense

Why I would buy a Home Today

I want to buy a house and I want to buy it now!

But TV and the media reports about housing scare me!

With the media constantly reporting that the "Sky is falling" in the housing market, why should anyone consider buying a house? What the media fails to report is there is no better time to buy a house. Why? It’s a Buyers Market. Buyers buy in Buyers Markets! Sellers sell in Sellers markets! There has been a seller’s market for over 5 years, now it is the Buyers turn for a bite at the apple.

The historic fact is: "It has been always easier to talk yourself out of purchasing a home then it ever is into buying." Buying a home is a tremendous responsibility and commitment. For first time home buyers, it can be down right intimidating. But in today’s housing market, if you are one of the lucky people who are qualified to buy a house right now, it is my duty to tell you: "It doesn’t get any better than this."

I have been through 5 housing cycles as a builder, home owner, energy consultant and real estate investor. I always end up shaking my head in disbelief, when a super-heated sellers market cools off, how qualified home-buyers hesitate when the best purchasing conditions are in place with all the incentives and benefits that go with it. That is why it is called a buyers market--the buyer gets the best deal. Historically I inevitably hear, after the buyers market has passed, "You were right Bob, I should of bought my house last year." It always reminds me of a modified little diddy called: A reluctant home purchasers lament.

Housing ownership is a critical part of the United States dream and economy. The government recognizing this has recently put in place practical, strong, financial incentives designed to encourage the purchase of affordable housing–especially for 1^st time home buyers right now-today.

But Bob, aren’t these new incentives encouraging buyers to stretch their resources in order to buy a home? Isn’t this the same mortgage and banking philosophy that resulted in the current fore-closure crisis? No! Why? There is one difference–the incentives today are only available to those who have maintained good credit ratings and demonstrated the ability to manage their money astutely.

Today’s home buyer must meet a higher standard in order to qualify for a mortgage. No documentation loans, no down-payment requirements, the over-looking of excessive credit card debt and low credit scores are lax, sub-prime mortgage lending practices of the past. For those far-sighted buyers who meet the common sense standards required by lenders before the latest, out of control, frenzied real estate marketplace–there is no time better to buy a house.

There is another recognized force affecting the housing market place of today. It is called: "The cost-of-home-ownership:" What it costs the homeowner to operate and maintain their residence after they move in. It is the single most important financial factor affecting home ownership after buying the house.

The monthly, yearly and life-cycle operational costs of owning a home, has not received any attention in the past–the thinking being if you can afford to buy the house, you can afford to maintain and operate it.

This recognition is driving two highly publicized movements concerning housing today: Energy Efficiency and Green, Sustainable Building Practices. All of us see the affects of higher energy prices each time we fill up our car or look at a utility bill. Many of us don’t associate our homes maintenance bills with the Green Building Movement–many of us think Green is a Star Wars concept–when in fact it is about sustainable, durable, building applications and common sense resource conservation.

Energy Efficiency: There are no magic wand theory’s available to solve the expensive, energy crisis in the foreseeable future. Practical and affordable energy options to include: solar, wind, new petroleum sources, nuclear power, electric and hydrogen powered automobiles, revolutionary and as yet undiscovered new energy sources are years away. Without government incentives, the only affordable energy options available to homeowners today, is energy conservation.

Hang on! That doesn’t mean potential home buyers have to lower their expectations for a new home or existing home. It means they have to evaluate their housing choices and all amenities being equal, weigh the advantages of energy efficiency in making their housing choices. They have to be able to discern between substantiated, legitimate claims of efficiency and those that are just hype.

Energy Star Certified Homes have to be evaluated and tested by a HERS rater. The Home Energy Rating System index (HERS index) is considered the Gold Standard in energy efficiency ratings. Don’t get fooled by unsubstantiated claims. 3^rd party verification by a HERS rater is the only standard recognized for Energy Star certification. Energy Star Certification requires homes to be at least 15% more energy efficient than 2006 IRC homes built to code.(Remember the building code is the minimal building standard required in order to receive a Certificate of Occupancy, so building strictly to code means a builder is meeting minimum standards). Energy Efficiency usually equates to lower utility bills than comparable housing.

Green, Sustainable Building Practices: I won’t bore you with the Building Science or being a good citizen facts here. Many affordable housing producers have always thought the cheaper the initial cost of the product the better. That is why many affordable houses could not make it through one standard mortgage term of 30 years before being torn down, blighted or totally renovated. Green Building addresses those discrepancies and Yes, it can be done cost effectively. Green building practices belong in affordable housing applications. The home owners, renters, and housing agencies struggling to make their monthly payments benefit the most from reduced energy usage and lower maintenance bills.

The fact is Energy Efficiency and Green Building practices are not a quick fix, knee jerk reaction fad that is going to disappear. They will become mandatory over the next few years. All levels of government, Federal, State and Local are legislating more and more Green, Energy Efficient Building practices into law. This isn’t a bad thing.

Currently the U.S. House of Representatives is working on the Perlmutter bill to financially reward those buyers, builders and developers of Green, Energy Efficient, Affordable Housing. "The United States House of Representatives Financial Services Committee recently passed the Green Resources for Energy Efficient Neighborhoods(GREEN) Act, the most comprehensive green building bill ever passed by a congressional committee. The bill transforms federally assisted affordable housing. It will raise the bar on performance and generate billions of dollars in funding for green affordable development."

While you are thinking all this over please keep in mind a few of the extra added benefits of a Green, Energy Star house. You now own a house that lives healthier, is more comfortable, heats and cools more efficiently, alleviates potential water and mold issues, besides being energy efficient, durable and designed to make your home ownership experience more rewarding and hassle free.

Contrary to what the media is reporting–there isn’t a better time to buy a house or home. Professional investors who purchase homes actually embrace a market place like this. Why? The best buying terms are available. The best prices, the best terms, the most potential for profit over the years. They follow the old axiom, buy in a buyers market, sell in a sellers market. Add in all the government sponsored incentives for affordable, first time home buyers and it’s crazy to wait–buy it now. I know I would.

The next blog will talk about the $7500.00 Federal tax credit that is available to first time home buyers.

I haven’t blogged in months. I switched from over-thinking Green building to again, practically applying what I believe in, to affordable housing being constructed by a non-profit builder and a housing authority. That is what really got me into the movement over 30 years ago, how to get energy efficiency technology into a building with cost justification.

I believe today, with what we know, that we have run out of excuses for not applying cost effective, green, energy efficiency systems to all new construction. I also believe these systems should be incorporated, after cost evaluations, into the renovation of existing buildings, when it is time to do so. I don’t believe you should arbitrarily do an energy or green retrofit just to do it, without substantiated financial reasoning.

For the past 18 months I have also had to constantly evaluate where I stand in the Green, Energy Efficient Building movement. I mean what do I see when I look in the mirror? Do I just see a person verbalizing Green/Energy Efficiency hype for a profit motive? Am I a Green Washer? Or do I really believe in this stuff? The fact is I do believe in this stuff, but where do I fit or stand?

I have an Engineering degree, but I am not a Building Scientist. I leave that niche to Joe Lstiburek, Chuc Bowles and others. I am not the philanthropists or foundations funding Green programs–they have the money and it is the right thing to do. I am not a Hollywood star with a cause and a following, although they again are doing the right thing. I am not the Enterprise Foundation encouraging Green Affordable Housing development, and backing up their mission with dollars. I am also not the world’s most prominent builder, although I do advise various Virginia Habitat for Humanity Chapters about how to cost effectively apply the EarthCraft House Virginia program into their houses. I am not a politician, but again those that embrace the technology get my vote. Energy shortages are a crisis in waiting–they aren’t going away.

So where do I fit? I finally figured it out. I am one of those rare individuals who is a HERS rater and Class A contractor. My niche is how to bridge the technology to actual application gap. A long time ago, a women in Nebraska, who had contacted me about renovating older structures in her small city, told me she was disappointed that I didn’t live in Nebraska. She said there were so many people in the world who could tell her how to renovate a building or how to turn around her main street, but no one that could tell her and actually do it. Well that’s my fit–I can not only tell you about how to do it, but I can actually do it. That is called talking the talk and walking the walk. That is where my niche is: That vast wasteland/desert between the mountains and the sea. I am the guide across it.

Ask your local home inspector, building inspector, LEED’s inspector, HERS rater or Green Guru how many of them have actually applied any of this technology to a house, a Historic Structure, a commercial building, townhouses, apartments or their own home. I am sure there are not too many. Those of us that have actually bridged the gap between written technology and application bring a lot of common sense experience to the movement. My designation in EarthCraft Virginia is as a TA–Technical Advisor. I like to think it means: Talker–Applicator.

My all consuming goal, besides applying cost justified applications to buildings and housing I am involved with, is to insure that my practical technology and experience gets incorporated into Main Street America. I want it in affordable and subsidized housing. When I can practically and cost effectively bring this movement into the affordable housing realm, then I have done something.

Of course then I will have really done something-- created a new paradigm, "That the cost of ownership of a building or house is equally as important as the initial cost or:

Most Cost Effective Affordable housing is:

Initial Cost+Occupation Costs Life Cycled over 20-30 years.

After over a year of providing technical support for the introduction of EarthCraft Housing to the Hampton Roads Virginia area, I have had to contemplate seriously my involvement.  What is it that I am trying to accomplish.  Is it to introduce EarthCraft housing and push builders into accepting this standard?  Or is it to get Energy Efficiency and Sustainable Building practices into housing both existing and new? 

Everyday I see Green Building talked about and highlighted on the myriad of newsletters and blogs I subscribe to.  I have come to the conclusion that my focus is on getting cost effective, energy efficient, sustainable building practices into the affordable housing area.  That a misconception exists that all practices to incorporate this technology into building is cost prohibitive.  It is not.  If we simply tighten up our conceptual building practices to a reality in the field, we can get all affordable housing producers to incorporate the practices into everyday building. 

That is my goal and that is my focus.  No matter what program is followed, all Green programs have the Energy Star thermal envelope standards incorporated into the program.  That is the bed-rock of all the programs and if affordable housing providers will simply follow those standards, which are not excessive, but rather common sense based, we can begin to make substanial in-roads into providing energy conserving, efficient affordable housing.