Can We Unlock the Benefits of Home Ownership Through Energy?

The cost of housing is damaging. It forces people to make tough choices to keep a roof over their heads – eat, be cold, or go homeless. It’s not only the cost of rent or a mortgage that is debilitating. One of the most burdensome costs is domestic energy.

According to the U.S. Energy Information Administration, more than half of energy use in the home is for heating and air conditioning. Across the United States, at the end of 2019, average electricity bills were $115 per month – ranging from $76 in Utah to $168 in Hawaii.

Low-income families are hit disproportionately hard by energy bills. They tend to use more energy (for example, because one or more family members may be out of work, and young children are at home) but have less disposable income available.

Could constructing energy-efficient homes be the solution?

We should strive to unlock the benefits of homeownership

In the US, housing is considered a basic necessity, and the benefits of homeownership are well documented. These include:

  • The security that comes with owning your own home
  • Building better communities
  • Building a store of value and improving personal wealth
  • Improved educational outcomes
  • Better-quality lifestyle

When people rent their homes, they are more likely to move out of a community. The economic benefits of a stable community to a neighborhood are therefore eliminated. Why are we witnessing this dynamic in many inner-city and suburban locations? 

Simply put, homeownership has become more and more unaffordable. Part of the reason for this is the relatively high cost of energy, making it difficult for families to save down payments. 

Is sustainable low-cost housing part of the solution?

Research by Harvard University found that almost 40 million Americans live in housing they cannot afford. The burden of housing costs is highest on the poorest families, with many low-income families spending more than 50% of their income on housing. The shortage of affordable housing is a serious problem for many families in the United States.

Clearly, affordable housing is a central issue in urban development and the social contract. Low-cost, affordable housing is a necessity for many and an aspiration for many others. It has been shown that where affordable housing is available, the local economy benefits from increased workforce participation and higher employability rates.

We’re not saying that provision of low-cost, affordable housing is the solution to the housing crisis, but it should be a central pillar of an economic package targeting the issue.

Is energy efficiency the answer to provide people with affordable sustainable homes?

As we have seen, it’s not only high rents that stop people from buying their own properties. It is the high cost of living in a home.

A big problem with affordable housing in the United States is that most of it is not sustainable. The materials used in affordable houses are not durable or long-lasting. They are very expensive, and as a result, they have a high turnover rate which means more construction, demolition, and reconfigurations.

There are a few ways we can build low-cost affordable homes, including publicly financed low-income housing and smaller-scale developments. However, there is one way that is gaining much popularity: energy-efficient construction.

This may include the materials and methods used to construct the homes, as well as utilizing community renewable energy projects.

Additionally, homes that include an energy management system that monitors weather conditions and adjusts the home’s ventilation, heating, or cooling accordingly, are shown to reduce energy bills by as much as 23%. Over 10 years, this could save a family with average energy bills of $115 per month almost $3,200, not allowing for inflation.

We must include energy efficiency in our sustainable affordable housing planning

We simply cannot continue to burden low-income families with continuously rising costs associated with living in a home. Sustainable low-cost housing can only be delivered if we consider the total burden of costs to a family living in a home.

If we continue to construct using old technologies and inefficient materials, affordable housing ceases to be sustainable. Without also considering ongoing costs, affordable housing will become less affordable, and unsustainable.

At ACB Consulting, we are committed to building better communities, helping to deliver sustainable, low-cost affordable homes that will make a real difference to the people who live in them and the communities we develop.

To learn more, contact ACB Consulting.

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