Bill Overview
Title: GREEN Appraisals Act of 2022
Description: This bill requires lenders that originate federally backed residential mortgages to notify borrowers of their right to request an energy report concerning the property. The bill also requires, upon consent of the borrower, the lender to provide to an appraiser any available energy report concerning the property. The appraiser must take this report into consideration when appraising the value of the property.
Sponsors: Rep. Perlmutter, Ed [D-CO-7]
Target Audience
Population: Homeowners with federally backed residential mortgages
Estimated Size: 50000000
- The bill targets individuals involved in the mortgage process for residential properties with federally backed loans.
- The primary individuals affected are homeowners or prospective homeowners who are borrowing using federally backed mortgages.
- According to statistics, a significant portion of residential mortgages in the U.S. are federally backed.
- In the U.S., there are currently approximately 88 million owner-occupied housing units.
- Assuming a substantial portion of these are financed through federally-backed loans, millions of U.S. homeowners could be directly affected.
Reasoning
- The policy targets individuals involved in federally backed mortgages, many of whom might be looking to increase energy efficiencies in their homes. It could potentially impact the perceived value of a home if energy efficiency is highlighted, leading to greater incentives for implementing such measures.
- With a budget constraint, the policy might only allow for a limited rollout or focus areas initially, impacting a subset of the population more significantly than others.
- It is important to include diverse population sub-groups, including varied income levels, geographical locations, and types of residences (urban vs rural) to understand the full spectrum of policy impact.
- There could be varying levels of impact, with some benefiting significantly due to increased home valuations or energy savings, while others might see little to no effect if their properties are already energy efficient or they do not engage with the process.
Simulated Interviews
Software Engineer (San Francisco, CA)
Age: 45 | Gender: female
Wellbeing Before Policy: 8
Duration of Impact: 10.0 years
Commonness: 7/20
Statement of Opinion:
- The policy seems beneficial, especially for those who have already invested in energy upgrades like me.
- I hope appraisers will actually consider the energy reports instead of it being just another piece of paper.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 8 | 8 |
| Year 2 | 8 | 8 |
| Year 3 | 9 | 8 |
| Year 5 | 9 | 8 |
| Year 10 | 9 | 8 |
| Year 20 | 9 | 8 |
Teacher (Austin, TX)
Age: 32 | Gender: male
Wellbeing Before Policy: 6
Duration of Impact: 5.0 years
Commonness: 4/20
Statement of Opinion:
- This policy could help me save money in the long run if energy efficiency is properly appraised.
- I'm a bit skeptical about its implementation without additional incentives for energy improvements.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 7 | 6 |
| Year 2 | 7 | 6 |
| Year 3 | 8 | 6 |
| Year 5 | 8 | 6 |
| Year 10 | 8 | 6 |
| Year 20 | 7 | 6 |
Retired Librarian (Montpelier, VT)
Age: 67 | Gender: female
Wellbeing Before Policy: 7
Duration of Impact: 3.0 years
Commonness: 9/20
Statement of Opinion:
- The idea sounds good, but I worry about the appraisers undervaluing older homes regardless of energy reports.
- This could be an opportunity to add more value to my property if they consider solar upgrades.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 7 | 7 |
| Year 2 | 7 | 7 |
| Year 3 | 7 | 7 |
| Year 5 | 7 | 7 |
| Year 10 | 7 | 7 |
| Year 20 | 6 | 7 |
Freelance Writer (Orlando, FL)
Age: 29 | Gender: other
Wellbeing Before Policy: 5
Duration of Impact: 10.0 years
Commonness: 5/20
Statement of Opinion:
- This policy aligns well with my values, and could ensure my future home is both cost-effective and environmentally friendly.
- However, will there be resources to help first-time buyers understand these reports?
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 6 | 5 |
| Year 2 | 7 | 5 |
| Year 3 | 7 | 5 |
| Year 5 | 8 | 5 |
| Year 10 | 9 | 5 |
| Year 20 | 8 | 5 |
Auto Mechanic (Detroit, MI)
Age: 40 | Gender: male
Wellbeing Before Policy: 6
Duration of Impact: 7.0 years
Commonness: 6/20
Statement of Opinion:
- If the energy reports are accurate, this could improve my home's value.
- I'm concerned about the upfront costs needed to achieve these efficiencies, though.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 7 | 6 |
| Year 2 | 8 | 6 |
| Year 3 | 8 | 6 |
| Year 5 | 8 | 6 |
| Year 10 | 8 | 6 |
| Year 20 | 7 | 6 |
Accountant (New York, NY)
Age: 58 | Gender: female
Wellbeing Before Policy: 8
Duration of Impact: 5.0 years
Commonness: 8/20
Statement of Opinion:
- Useful for understanding property value in urban settings where space for improvements is limited.
- Hope this leads to tangible benefits, not more bureaucratic processes.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 8 | 8 |
| Year 2 | 8 | 8 |
| Year 3 | 8 | 8 |
| Year 5 | 8 | 8 |
| Year 10 | 8 | 8 |
| Year 20 | 8 | 8 |
Electrician (Denver, CO)
Age: 38 | Gender: male
Wellbeing Before Policy: 7
Duration of Impact: 10.0 years
Commonness: 7/20
Statement of Opinion:
- Glad to see policy supporting energy efficiency, which aligns with my values.
- Wish there was a component for incentives to improve older neighborhoods.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 8 | 7 |
| Year 2 | 8 | 7 |
| Year 3 | 8 | 7 |
| Year 5 | 8 | 7 |
| Year 10 | 9 | 7 |
| Year 20 | 9 | 7 |
Factory Worker (Cleveland, OH)
Age: 51 | Gender: male
Wellbeing Before Policy: 5
Duration of Impact: 5.0 years
Commonness: 6/20
Statement of Opinion:
- Hoping the policy can help reduce my energy bills in the long-term.
- Feels a bit complex; not sure how reporting will help directly.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 6 | 5 |
| Year 2 | 6 | 5 |
| Year 3 | 7 | 5 |
| Year 5 | 7 | 5 |
| Year 10 | 7 | 5 |
| Year 20 | 6 | 5 |
Part-Time Volunteer (Phoenix, AZ)
Age: 70 | Gender: female
Wellbeing Before Policy: 6
Duration of Impact: 2.0 years
Commonness: 8/20
Statement of Opinion:
- The policy seems redundant for someone like me who already prioritizes energy efficiency.
- Could be useful for buyers but might not affect retirees much.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 6 | 6 |
| Year 2 | 6 | 6 |
| Year 3 | 6 | 6 |
| Year 5 | 6 | 6 |
| Year 10 | 6 | 6 |
| Year 20 | 5 | 5 |
Student (Chicago, IL)
Age: 27 | Gender: female
Wellbeing Before Policy: 7
Duration of Impact: 10.0 years
Commonness: 4/20
Statement of Opinion:
- I hope this makes me feel more confident in choosing energy-efficient homes.
- However, the process may add complexity to an already daunting first-time purchase.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 7 | 7 |
| Year 2 | 7 | 7 |
| Year 3 | 8 | 7 |
| Year 5 | 8 | 7 |
| Year 10 | 9 | 7 |
| Year 20 | 8 | 7 |
Cost Estimates
Year 1: $180000000 (Low: $150000000, High: $220000000)
Year 2: $150000000 (Low: $120000000, High: $180000000)
Year 3: $130000000 (Low: $100000000, High: $160000000)
Year 5: $110000000 (Low: $80000000, High: $140000000)
Year 10: $90000000 (Low: $60000000, High: $120000000)
Year 100: $70000000 (Low: $40000000, High: $100000000)
Key Considerations
- Costs associated with the administrative changes for lenders and appraisers.
- The breadth of the impact on the federally backed mortgage market.
- Potential energy efficiency improvements that may result in economic savings.