Real Estate - International

Canada Cuts Energy Grants for Houses, Launches New Initiative - 2006-05-18

Canada Mortgage and Housing Corp. (CMHC) is asking builders and developers to come up with "the next generation in Canadian housing" through the Net Zero Energy Healthy Housing (NZEHH) initiative. The goal is to design a home that can produce as much energy as it consumes. But days before the initiative was launched, the government eliminated the EnerGuide for Houses program, which last year provided grants to help more than 30,000 people renovate their homes to be more energy efficient.

CMHC has issued a Request for Expressions of Interest, inviting builders and developers for their visions of homes that integrate passive solar design and other renewable energy systems such as solar water heating, electricity and ground-source heat. The homes will be connected to the electricity grid and will be able to draw power as needed, but they must be able to feed excess power back into the system.

Related Article...

1988 - I financed a home for a couple a few years ago in an area near San Antonio, TX. Yesterday I received a call from them asking about a mortgage to buy some land near a lake where they would one day build a cabin. I told them they didn't want my money, and sent them on their way. Why didn't I immediately take a loan application for a lot and construction loan? More money for me, right? Easy. They didn't need it. But let me explain. When they bought their first home, they put about 40% down, so right out of the gate they had some really decent equity in their property. In addition, their home value has nearly doubled in four years time. That's a lot of equity. In this case, about $600,000 in equity, which I suggested they use instead of a loan to buy an undeveloped lot. I've seen this on more than one occasion where clients simply look right past their biggest asset when exploring financing options and zoom right toward construction loans, lot loans or loans to buy a ski condo. Rates for properties other than a primary residence are not only higher, but they also require a minimum down payment. When you have some equity in your home, look there first for financing. And you usually have two distinct options. Read this Nemmar Real Estate Training article at Mortgage Loans, Finance, Economy, Appraisal

 

The homes must also incorporate "the principals of occupant health and comfort, affordability, resources conservation and reduced environmental impact," says CMHC. The federal housing agency says there is currently no model for NZEHH, but that it includes climate specific design, natural delighting, energy-efficient appliances and lighting, water conservation and re-use, land and natural habitat conservation and sustainable community design practices.

Builder and developer-led teams are invited to submit their proposals until June 30, 2006. Based on the quality and quantity of submissions received, up to 20 projects will move forward to the design-development stage. These winning teams will get technical and financial support to create detailed design proposals. CMHC says six to 12 of these projects will move on to the construction demonstration monitoring stage, which takes place from December until July 2009.

Anyone interested in taking part must register by calling 1-800-668-2642.

The NZEHH "is an important component of our country's clean-energy future," says CMHC. "It will help reduce the energy intensity of Canada's housing sector, support our growing renewable energy and sustainable housing industries, (and) help Canada meet its goals of reducing greenhouse gas emissions, promoting clean air in healthy, sustainable communities, and maintaining a healthy environment for generations to come."

The launch was overshadowed somewhat by the government's cancellation of the EnerGuide for Houses retrofit program. Launched in 2003, the program was designed to encourage Canadians to make their homes more energy efficient during renovations. The program certified independent energy advisors to perform an audit on homes before the renovations, and recommend the most energy-efficient improvements. Grants of 10 to 20 per cent of the expenditures for energy retrofits were made available.

Green Communities Canada, an environmental service organization, told the Toronto Star that the average homeowner in the program spent about $5,000 and received a grant of $700. It says the homeowners saved an average of $750 in yearly energy costs.

But Gary Lunn, the federal Minister of Natural Resources, said in the House of Commons that the government spent $44.3 million on the program in the last year, and only $24.1 million made its way to homeowners. The rest went to the independent auditors who inspected the houses, and to administrative costs. "This is not efficient. It is not effective," said Lunn.

In cancelling the program, which was created by the former Liberal government, the Conservatives said they will come up with their own "made in Canada" energy plans. Some of the provinces are reported to be considering rescuing the program.

Canada has a history of innovative residential energy programs, including the R-2000 initiative that has been operating since 1981. Homes built to the R-2000 standard must meet a performance standard for energy efficiency and environmental impact, and they must be tested and certified before they can be marketed as R-2000 homes. The technology has gained world-wide recognition, and R-2000 homes have been built in Japan, the United States, Poland, Russia, Germany and England.

Discuss this article

Real Estate From A to Z  -  Nemmar Real Estate Training. House Exterior Interior Structure Roofing Plumbing Insulation Heating Electrical Air Conditioning Construction Repair Home Improvement Renovation Home Inspection Appraisal Market Value

Nemmar Real Estate Training
Nemmar Business and Computer Consulting