Reshape policies to respond to the prevalence of rental tenants.

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Federal Weatherization Program

Hillside Manor, Milwaukee, HVAC upgrades by the Resource Act Modernization Project.  photo: Dan Carter

The Federal Weatherization Assistance program aids lower-income households to improve their energy efficiency and there lower energy costs.  The cost burden of energy consumption is reduced through weatherization techniques rather than through addressing the amount of energy consumed via lifestyle choices.  While the energy costs to these households have been reduced through the program, it does not address the energy consumption by those with incomes too high to qualify.

The Federal Weatherization Assistance program assists both single-family and multi-family dwellings, owners and renters.  Eligibility is open to all households making at most 60 percent of the state median income, regardless of whether they rent or own.

Sustainable South Bronx

When asked how varying ownership structures in urban and rural areas operate, Miquela Craytor responded: “I think that's one of the largest challenges to the work of transforming our built environment for energy efficiency.  If your current electricity bill doesn't account for heating, you as a tenant don't really care what happens to the building. The building owner is experiencing it. And it's the building owner who has to put up some money, and if they receive a benefit if they reduce the energy cost, then that's great. But if the tenant is paying for it, and the building owner has to make the decision if something happens, then there's a mismatch. The challenge is: who's really paying for it, where is that cost embodied, and who would have to take care of it if there's a change to the building? And it varies between building and city and tax codes and building codes and the utilities. It's not one-size-fits-all.” Miquela Craytor, Underdome Interview

Vishaan Chakrabarti

When asked how can renting be encouraged as an economically viable model Chakrabarti remarked, “You could either make rent tax deductible, instead of trying to strip away the mortgage deduction, just try to put them on an even playing field, which would worsen our deficit, or you can basically strip away the mortgage deduction to level the playing field.” Underdome Interview Chakrabarti suggests “dismantling the false promise of the “ownership society” by putting renters, who are primarily city dwellers, on equal footing and on the forefront of a more agile, mobile labor force. Being Dense About Denmark

“You know it’s interesting because landlords and real estate developers, the more old-school real estate developers, hate condos. They don’t want to develop condos. They like the steady income that comes from a rental property. It’s when you have a frothy market that you get a condo market. What happens is land owners start to think, 'Oh, I can make a quick buck by selling.' You get a lot of amateurs who enter the real estate market and say, “I can sell condos like in New York for two thousand or twenty-five hundred dollars a square foot.” So you get a lot of new entrants into the market who drive up land prices because again the old-school developers don’t sit there and say, “I’m going to buy land based on the idea that I’m going to sell condos for some extraordinary amount of money.”

And if you look right now you’ll see that in a city like New York, the old-school developers, because they’ve got their rent rules and because they didn’t go out and buy land for ridiculous prices (they stopped buying land a couple years ago), are in much better shape than the new entrants to the market who are purely condo developers, who are largely speculators, who came in and bought land for extraordinarily high prices, and now can’t sell the condos that they either started to build or have built.” Underdome Interview

Commentary

Tom Friedman

"Landlords chronically underinvest in energy-efficient designs, building construction, and appliances, because their tenants pay the electric bills. When the tenant pays, the landlord doesn’t care about forward operating costs, so he will minimize all upfront capital expenditures. When the landlord pays, the tenants don’t care about efficiency and will not look to optimize and minimize ongoing energy consumption. And often, people just don’t know that this lightbulb or that dishwasher is better than another in terms of energy efficiency, so they will not make the right choices, even if they are economically incentivized to care. That is why you want the government to step in and guide the marketplace." Hot, Flat, and Crowded, 339

References

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