Monday, October 5, 2009

Selling Your Home - Big Brother Is Coming

H.R. 2454, the CAP and TAX bill passed by the US House of Representatives now awaiting action by the Senate and if enacted presumably signature by President Obama is going to result in much higher energy bills for all Americans. In fact, authoritative sources estimate that the average additional cost for a family of four will exceed $3,000 a year. But that is not the worst of it.

H.R. 2454, which is over 1,000 pages long, contains many onerous Sections that are likely to cost all of us additional monies. Most important there are provisions dealing with our homes. Sections 202, the Building Retrofit Program, mandates a national retrofit program to increase the energy efficiency of all existing homes. It is likely that shortly after enactment of this Act, as a requirement of sale, it will be necessary to retrofit the home to comply with the energy and water efficiency standards of this Act. Section 204, the Building Energy Performance Labeling Program establishes a labeling program that for each individual residence will identify the achieved energy efficiency performance for "at least 90% of the residential market within 5 years after the date of enactment of the Act. And, Section 304, the Greater Energy Efficiency in Building Codes establishes new energy efficiency guidelines for the National Building Code and mandates in 304D that one year after enactment of this Act, all state and local jurisdictions must adopt the National Building code energy efficiency provisions or must obtain a certification from the federal government that their state and or local codes have been brought into full compliance with the National Building Code energy efficiency standards.

All of this is a NIGHTMARE for homeowners because the law allows the states discretion to figure all of this out from an administrative standpoint. Clearly, if we want to live in our homes or sell a home, we will have to deal with BIG BROTHER who will certify the home for energy efficiency standards prior to sale. Most likely for older homes that could mean major renovation and cost because older home's built in appliances, heating and air conditioning systems, insulation and windows may not meet these new standards. If renovation is required as a condition of sale, it could cost the homeowner seeking to sell the home thousands of dollars. As though the real estate markets were not already a mess, adding this new restriction will result in even more foreclosures because if the homeowner is both upside down on the mortgage and facing major renovation expenses, the homeowner will just walk away from the home and give it back to the bank, rather than attempt to sell it.

As usual, the Democrat Socialists that control Congress and President Obama do not understand the law of unintended consequences. It is one thing to begin these new energy standards related to new construction, which may make some sense; though it will cost more to build a home; but quite another to require retrofit of existing homes. These provisions in the CAP and TAX bill along with many others will cause chaos in the real estate markets. Oh well, another day another Obama job killer bill. It is all in a day's work for our BIG BROTHER, President Obama and the Democrat Socialists that control Congress.

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