Millennial’s May Have to Delay Buying First Home

It’s always been difficult for young families to buy their first home. I was 28 before I could afford mine.

Millennials, for example, are beginning to buy their first home. But will they continue to be able to do so, and what about generation Z, which is next in line.

Saving enough for the down payment, and earning enough to qualify for a mortgage is hard enough, but what happens when the cost of homes goes up?

Especially, when it’s the government that’s forcing the price of homes to rise.

That’s what is happening in California, and will happen in other states too, if extreme energy efficiency measures are put in place.


California is putting measures in place that will force builders to construct new homes with much higher levels of energy efficiency.

And, this is increasing the cost of homes in California.

California regulators are establishing rules so that every home built by 2020 is a Zero Net Energy (ZNE) home. ZNE homes must not use more energy than they produce.

It’s almost a requirement that ZNE homes have PV rooftop solar panels to generate electricity, while also being extremely energy efficient. (Geothermal, and wind are conceivable alternatives to PV rooftop solar in a few situations.)

For example, in Southern California, the cost of a PV rooftop solar installation is approximately $21,000 dollars, and will save approximately $2,500 a year in electricity costs. This installation requires 8 years to recover the investment, which means, in economic terms, it’s a poor investment.

Equally important, the cost of the home is increased by $21,000, making it more difficult for young families to save enough for a down payment.

But this is only half the story, because the home must also conform to new energy efficiency standards that will further increase the cost of a new home.

To meet these new efficiency requirements, homes must be far better sealed.

Rather than using wooden 2×4’s, the industry standard for decades, homes might have to use “insulated concrete panels and polystyrene walls to create a sealed envelope.” At least, this is what Meritage Homes Corp. says it may do.

There aren’t many options for sealing and increasing the air-tightness of a building, or improving its insulation level.

For example, the Reston Association, near Washington DC, proposed reviving the straw bale techniques of pioneer days, with a new building having walls a foot thick, and using straw for insulation to improve energy efficiency.

It should also be noted, sealing a home too tightly can degrade inside air quality.

The California government is proposing that all appliances be rated energy star, and interconnected with a controller so that dishwashers, washing machines and clothes driers only function when electricity is at its cheapest, which is during nighttime. They also propose windows be energy rated so as to reduce the amount of heating caused by the sun.

Low-E windows could cost $20,000 to $30,000 for a typical home.

Here’s what DOE’s Pacific Northwest National Laboratory (PNNL) said about triple pane windows it has used in its studies:

“It would take 23 to 55 years to save enough on a utility bill to cover the higher cost of the windows, based on national electricity costs.”

Low-E windows, energy efficient appliances and controllers being required by government, could add another $20,000 to $40,000 (possibly more) to the cost of a new home.

All told, PV rooftop solar panels (or equivalent) and energy efficiency requirements, mandated by government regulations, could increase the cost of a new home by $40,000, and possibly twice that much, thereby forcing millennial and generation Z families out of the housing market.

The reason for forcing people out of the housing market is to reduce CO2 emissions.

By 2050, California plans to reduce greenhouse gas emissions 80% below 1990 levels.

California says residential buildings account for 32% of the state’s electricity usage, while commercial buildings account for 37%, therefore new regulations are required to force builders to build more efficient, and more expensive buildings.

And, of course, what about existing buildings?

What new regulations will be put in place to force existing homeowners to add insulation, or replace existing appliances with more efficient appliances.

These same types of regulations are being planned for other states, because they too will need to force people to spend money on energy efficiency, and, possibly, PV rooftop solar to achieve ZNE homes.

In California, electricity prices are rising. The Energy Commission says that homeowners can offset the higher cost of electricity by investing in energy efficiency and PV rooftop solar, thereby justifying the cost of the added investments. As prices rise, efficiency becomes more valuable.

But this is an hypocritical argument, because it’s the government that’s forcing utilities to use expensive and unreliable wind and solar, which is causing electricity prices to rise in the first place.

Government is creating the higher cost of electricity, while expecting homeowners to offset the higher cost by investing more of their hard earned money in energy efficiency.

Forcing people, industry and utilities to cut CO2 emissions is a fool’s errand, because it hurts Americans without any possibility of eliminating the threat from climate change.

It’s all pain and no gain.

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Nothing to Fear, Chapter 14, Impossible Objective, provides data on the quantity of CO2 emissions from each sector of the U.S. economy, and why it’s impossible to cut CO2 emissions enough by 2050 to stop climate change, if it really is caused by CO2.

Nothing to Fear is available from Amazon and some independent book sellers.

Link to Amazon:

Book Cover, Nothing to Fear
Book Cover, Nothing to Fear

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