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Earth United States

What Stops Millions of Americans From Going Green: Their Landlords (msn.com) 169

The Washington Post looks at "Americans who want to lower their carbon footprints — but are stymied by their landlords." Homes and apartments burn oil and gas, suck up electricity, and account for about one-fifth of the United States' total greenhouse gas emissions. But current attempts to green America's homes, including billions of dollars in tax credits for energy efficient appliances and retrofits, seem aimed at the affluent owners of detached, single-family homes — in short, Mad-Men-style suburbias. In reality, about one-third of the country's households live in rented apartments or houses... And they generally do not have the spare cash — or the permission from their landlords — to make environmental upgrades. Part of the issue is what's known in economics as the "split-incentive problem," or the "landlord-tenant problem." Roughly 75% of tenants in the United States pay their own utility bills; that means they have a strong incentive to try to conserve electricity, water, or gas to save cash. But their landlords, who have to pay for installing and replacing those appliances and heating systems, don't. They benefit from renting out their properties as quickly and cheaply as possible...

Renters, therefore, are often stuck with leaky housing, inefficient appliances and ancient heating systems. According to one study from 2018, renters use almost 3 percent more energy than homeowners thanks to the split incentive problem... President Biden's signature climate bill includes an estimated $37 billion in tax credits to help households switch to efficient heat pumps, water heaters, or to seal up and insulate their homes. Those credits are applicable to individual homeowners or renters — but not landlords. According to IRS guidance, "the credits are never available for a home that you don't use as a residence." And few renters are going to want to spend thousands of dollars on a heat pump that they'll have to leave behind when they move...

If the landlord problem isn't solved, millions of less wealthy Americans could be left out of the green transition — and will be stuck with higher energy bills. For example, even in the same income bracket, homeowners are almost three times more likely than renters to own electric vehicles — largely because renters lack home charging. There are programs, including some in America's giant climate bill, that could change this... Still, those programs haven't launched yet and aren't expected until at least late this year. And even though renters make up one-third of American households, they're still getting less investment; the tax credits for homeowners are uncapped. The federal government could end up spending well over $50 billion on homeowners, and about $8 billion on renters.

Most renters remain at the mercy of their apartment managers and landlords.

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What Stops Millions of Americans From Going Green: Their Landlords

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  • Free money! (Score:5, Insightful)

    by korgitser ( 1809018 ) on Sunday June 04, 2023 @08:02AM (#63574957)

    Here we go! The US is currently in the process of consolidating the country's real estate into the hands of just a few big companies. They muddy the waters of actual ownership through a million of smaller holding companies, but the trend is clear. There is not many people left who can actually afford to buy a home, and the number is going down as time goes by. And the smaller landlord companies get bought out by the bigger ones as time goes by. So home ownership is dead in the US.

    But what being proposed in TFA is just a free government giveaway to these companies. This will bring about a green transition just as much as any of the multiple presidents' broadband bills have brought about quality internet, or Biden's chip money will bring about a renaissance of american chipmaking, how Trumps corona funds brought about the saving of small businesses, or any other has brought about any other supposed improvement. As any other such "measure" before, this one's also just that: free money for those who can afford the ticket to go and get some. They will take the money, buy hookers and coke, and make excuses as to why nothing changed. And they will be let off the hook because they paid the campaign bill of both parties.

    • by djp2204 ( 713741 )

      So what you're saying is that we need BOTH a vacancy tax (10% annually of the appraised value of the property) AND a tax on multiple properties (call it another 10% annually of the appraised value of the property). Finally, eliminate the depreciation deduction on real estate and the carried interest deductions so the taxpayers stop subsidizing high property costs and a lack of housing.

      • So what you're saying is that we need BOTH a vacancy tax (10% annually of the appraised value of the property) AND a tax on multiple properties (call it another 10% annually of the appraised value of the property). Finally, eliminate the depreciation deduction on real estate and the carried interest deductions so the taxpayers stop subsidizing high property costs and a lack of housing.

        Adding to your comment...

        All of those taxes would reduce the incentive for property owners to rent, leaving them the only option but to keep their lands free & clear of any development at all.

        In many localities you can have vacant lots in residential and urban areas so long as you keep the weed growth in check and remove the trash that naturally accumulates.

        And in most localities the property taxes breakdown to separate evaluations (1) the unimproved land (a vacant lot); (2) any improvements and structu

  • One way (Score:5, Interesting)

    by codebase7 ( 9682010 ) on Sunday June 04, 2023 @08:03AM (#63574961)

    Roughly 75% of tenants in the United States pay their own utility bills; that means they have a strong incentive to try to conserve electricity, water, or gas to save cash. But their landlords, who have to pay for installing and replacing those appliances and heating systems, don't. They benefit from renting out their properties as quickly and cheaply as possible...

    One way to fix that would be to create some sort of equity system for renters. I.e. A percentage of your rent payments goes towards an "equity" account that the renter can withdraw from. Or use with loans as collateral. Just like a regular homeowner's property appreciates in value. Improvements to the landlord's property, (such as the kind from TFS), could be used as tax credits deposited into the renter's "equity" account. Obviously, portions of that equity would be withdrawn from by the landlord if they can prove in court that the renter caused damage to the property.

    With such a renter "equity" system in place, there's a market incentive for the renter to maintain the property, and to make improvements to it. While also creating an incentive for the landlord to allow the improvements. It's free to the landlord, and the improvements mean that the property will have higher property values and attract more affluent tenants.

    • Re:One way (Score:5, Interesting)

      by burtosis ( 1124179 ) on Sunday June 04, 2023 @09:19AM (#63575045)
      Sure, some people can be deceived into renting a property that has higher than average cost utilities, but the reality is most people will see that and rent elsewhere because the rental market prices are already inflated in most areas and thus they will choose lower cost alternatives. It only becomes slightly harder to rent them, the base rental cost remains fixed - if it were common for a discount on inefficient properties this article would have no basis in reality. Further, most of the cases where this is true like in single family properties, unless the landlord bought in the 80s or earlier, the vast majority of the rent goes straight to the bank who takes the lions share for decades. This often doubles or triples the cost of the property to the owner, and thus is a major reason why rents are so high yet this is somehow lost on renters in part because of articles like this that make the landlord with one unit the bad guy and don’t mention banks or corporate capture or rental markets.

      It's free to the landlord, and the improvements mean that the property will have higher property values and attract more affluent tenants.

      The government needs to step in with financial aid only for people who own only a rental property or two as they are the ones actually facing financial hardship and face actual difficulties in the financing. Force companies to comply through regulations with substantial fines, they are profitable enough to handle and large enough to distribute the cost. Plus having brand new high efficiency heat/ac etc does almost nothing for rental rates (the point made in tfa) or resale value- you will barely break even or lose on those (thus the lack of improvement), people want visual improvements to spaces like the kitchen or bathroom in older properties and so that’s where the money naturally goes first.

    • Re:One way (Score:5, Insightful)

      by indytx ( 825419 ) on Sunday June 04, 2023 @09:23AM (#63575049)

      One way to fix that would be to create some sort of equity system for renters. I.e. A percentage of your rent payments goes towards an "equity" account that the renter can withdraw from.

      The article says that renters use 3% more energy than people who own their homes. Okay. Three. Percent. How much more do you think renters can afford to pay on top of their rent for this? They already shop for cost, size, and location. That's pretty much the extent of most renters' criteria. A single window without installation is hundreds of dollars. A new central AC can easily be $10,000. There is no economic argument for these people to pay dramatically more money on top of their rent to reduce that 3% number. They would be throwing good money after bad.

      There's also the issue of the ROI on this. In my city (a small city with a university), a large percentage of the renters are students or new/temporary university employees. None of these people intend to be in the same rental housing more than a year or two. It makes no sense for them to pay more to upgrade their rental unit.

      Maintenance on a rental unit is not like making an upgrade decision from an episode of This Old House. Smaller landlords are not going to spend $10,000 more for a Cadillac HVAC system in a rental unit. Or windows. Or sprayed-in foam insulation in a attic. Not for 3%.

      The only way to do this is for cities to change their building codes to require higher efficiency in new rental construction, but I would argue that this is already happening. New housing is dramatically more expensive than existing housing for reasons analogous to why new cars now cost so much. It's just more expensive to make things to comply with safety and efficiency requirements that existing stock did not have to when they were constructed, and retrofitting something is expensive.

      • by jhecht ( 143058 )
        Three percent difference is not zero when you're living on the margin, but it doesn't convince me the difference is significant or -- for that matter -- a real difference because there are so many other variables in housing. (It also comes from 2018 data, and the world has changed quite a bit since then.) The whole story seems riddled with shaky assumptions and dubious claims. Landlords come in a wide variety, from corporate investors to owners of duplexes who live in one apartment and rent the other. Some
      • New housing is dramatically more expensive than existing housing for reasons analogous to why new cars now cost so much.

        Gouging?

    • One way to fix that would be to create some sort of equity system for renters.

      Do you work for the IRS? That's probably the most complicated solution I've ever heard. Here's a simpler idea: Ban rentals with a low energy rating. Landlords who have been profiting for years will not let land sit empty if a simple solution of adding solar panels, insulation, etc can put it back on the market.

      This has an added benefit of reducing utility costs for renters.

      there's a market incentive for the renter to maintain the property, and to make improvements to it.

      As a landlord myself let me categorically say FUCK NO. I do not want random renters making "improvements". If improvements are required

      • by jwhyche ( 6192 )

        Do you work for the IRS? That's probably the most complicated solution I've ever heard. Here's a simpler idea: Ban rentals with a low energy rating. Landlords who have been profiting for years will not let land sit empty if a simple solution of adding solar panels, insulation, etc can put it back on the market.

        That is possibly the worse idea that I've heard. What happens to the people that currently live there? Talk about cities having a homeles problem now. Then let's say the landlords do this, how do they recoop the cost for this? By raising the price of rent. We already live in a time when rent is at a all time high. Many renters simply can't afford any increases.

        A far better plan is to set up a set of incentives and tax deductions to accomplish this. To take advantage of these incentives the landl

        • What happens to the people that currently live there?

          Nothing. Improving the energy rating of a house doesn't involve moving anyone out. You realise we're not talking about ripping down old houses right?

          how do they recoop the cost for this?

          Easy answer, they don't. The cost of improvements is trivial. Most can be done for less than a month's rent. Very easy to absorb by the landlord.

          We already live in a time when rent is at a all time high. Many renters simply can't afford any increases.

          No, renters can't afford to pay utility bills. Even if landlords do pass on the cost, the renter is no worse off.

          A far better plan is to set up a set of incentives and tax deductions to accomplish this.

          To do what? You're saying I can't improve anything without people becoming homeless, so using a tax to pa

          • by jwhyche ( 6192 )

            Yes, Yes, I'm sure you think this, but we both know how this will end. Landlords will use this as an excuse to raise the cost of rent. An yes, land lords will pass on the cost to renters and the renters will be far worse off. That is how things works.

            I'm pretty sure you might have some form or retort coming, you are probably even reaching for the reply key. Save it. I'm not even going to bother to read your reply, much less comment again on it.

            Good day.

  • by Gravis Zero ( 934156 ) on Sunday June 04, 2023 @09:08AM (#63575031)

    The solution to these kind of problems is exceedingly simple: require landlords meet a certain level efficiency and reduce emissions. The hard part of course is the political end of the problem because politics is inured in money from the rich.

    The real solve here requires people to care enough to overhaul a broken political system. It is only when things become exceedingly dire that we will see change that comes far too late to make a meaningful impact.

    • by PPH ( 736903 )

      The solution to these kind of problems is exceedingly simple: require landlords meet a certain level efficiency and reduce emissions.

      There is a segment of the rental market for which such upgrades are not economically feasible. These buildings will become food for bulldozers. And guess which part of the rental market they serve?

      • There is a segment of the rental market for which such upgrades are not economically feasible.

        That's pure unadulterated poppycock. How do you even come up with bullshit like this?

    • by crow ( 16139 )

      Or require landlords to pay for heat and electricity unless they meet certain efficiency standards. Don't separate the person deciding on efficiency improvements from the person paying the energy bills.

    • Here in West Australia we've just gone through two years of utterly brutal summers (This past one wasnt QUITE so bad, though still gnarly, the previous one had a month+ of 40c days), and the house I'm in like a giant heat trap. Actually hotter at night because heat cant escape , but very hard to keep it out. All of us in the 4 joined houses have been pleading with the landlord to put in ducted air conditioning because its a straight up inferno in summer, but nope. So I have to rely on a combination of one o

  • by fyngyrz ( 762201 ) on Sunday June 04, 2023 @09:38AM (#63575093) Homepage Journal

    Tax credits are specifically intended to screw the little guy. They require them to have the cash up front to do (whatever), then as much as a year or more later, (may) pay back some or all of it. Presuming congress, the executive, or some court hasn't interfered with the program in the interim.

    The people who actually need the help can't afford to put their funds out of circulation for long periods of time; they live paycheck to paycheck. Which the politicians know perfectly well.

  • by Impy the Impiuos Imp ( 442658 ) on Sunday June 04, 2023 @09:50AM (#63575111) Journal

    You'd have a million times better effect mandating good (or any) insulation in the buildings, especially the attics. It costs, and had little priority, given the cheapskates use undersized air conditions, and old school slapping a premium on electricity. Win win win for landlords!

  • Neighbors got heat pump. Still have to use electricity based heating whenever it comes close to 0ÂC.

    Others have solar which brings 22 kw on good days but that's just barely enough to drive one heater.

    Other than that, putting solar on the roof of an apartment house is a major risk if it is located in the worst part of the town and peope vandalize the roof regularly.

    • Vandalize the roof?

      Seriously?

      • Jup. I know a house that is a little shorter than the two adjacent houses and has a flat roof so the neighbours throw their garbage on the roof. One time the police had to come because they were throwing an unauthorized party. Not good for placing solar cells unattended.

    • by dgatwood ( 11270 )

      Neighbors got heat pump. Still have to use electricity based heating whenever it comes close to 0ÂC.

      They should have gotten a better heat pump that was appropriate for the climate. Modern cold-climate heat pumps are specifically designed to do well in cold climates by combining variable-speed compressors with larger coils (more surface area). They easily handle temperatures way below freezing without having to resort to auxiliary resistance heating.

    • Yup. Heat pumps are garbage, for any place that gets real winter weather.

  • Greed's Answer. (Score:2, Flamebait)

    by geekmux ( 1040042 )

    "Homes and apartments burn oil and gas, suck up electricity, and account for about one-fifth of the United States' total greenhouse gas emissions."

    So, let's make sure we demonize the shit out of that group, because after all Greed sure as hell doesn't want anyone looking at what accounts for the other 4/5ths. Hell, they don't even want you smart enough to know mathematical fractions.

    When corporations run their systems until absolute failure, in order to maximize profit, perhaps we should stop questioning why a landlord often does the same.

    And good fucking luck convincing society that a leaky faucet or shitty A/C unit in a home is the real waste and e

  • hilariously dumb (Score:5, Insightful)

    by argStyopa ( 232550 ) on Sunday June 04, 2023 @09:59AM (#63575125) Journal

    Yes, RENTERS (who are generally doing so because they can't afford a home) *of course* they have the spare cash for boutique "green" capital improvements to a property they don't own.

    Yes of course the only thing holding these people back is legislation.

    That's as stupid an idea as assuming everyone should buy a $60k electric car.

    Does logic even faintly enter the discussion any more?

    • Does logic even faintly enter the discussion any more?

      No matter what first world you may be broadcasting from, there is no doubt you are well aware of the current leadership "running" America. And given America still votes for their elected leaders, there is no doubt as to exactly how that happened.

      Smart people already know society would be FAR better off putting Dumb and Dumber in check instead of voting for them to lead. But, here we are. Still listening to Corruption tell citizens which ideas should be accepted, and which ones should be "racist".

      It's alm

  • When you can't afford a place to live in. These guys have no shame at all
  • Of course it's the landlord his/her fault.... They are the ones needing to pay for all the upgrading, while they cannot easily up the rent to get their investment back. It's not the landlord that benefits from the upgrades. I'll bet a lot of people will tell the landlord not to go ahead if the rent is upped because of it.
  • by kackle ( 910159 ) on Sunday June 04, 2023 @10:43AM (#63575189)
    Give me a break. I've been working on appliances for 40 years. It takes a lot of power to make them work, no matter their age or design...they are doing a lot of "work" for us. Throwing out functional appliances to improve efficiency (by usually a tiny amount) does the earth nor your checkbook any favors.* It costs to make/ship/install that new device and it costs to discard or recycle (yeah, lol) the old one.

    Also, the newer designs are often riddled with modern technology, tech that fails more frequently due to the added complexity. This is an inside joke where I work as we've started selling/repairing such devices.

    Per the article, if people are that broke, then I think keeping a roof over one's head is more important than having the most efficient appliances anyway.

    *A young coworker bought his first house and immediately replaced the washer/dryer for thousands of dollars for reasons of assumed efficiency. I asked him how long it will take to save thousands on his gas and electric bill (assuming no repairs are needed in the meantime!).
    • A friend of mine is an appliance repair technician. He tells me to try to hold onto my old Kenmore washer and dryer as long as possible since there are no new models available for any price that will work as well and as reliably as those.

    • Throwing out functional appliances to improve efficiency (by usually a tiny amount) does the earth nor your checkbook any favors.*

      You're making a shitton of assumptions there. Sure your toaster is unlikely to be more energy efficient now, but there are not only huge differences in some appliances (and TFS mentions heating as well) but there's actual differences simply from being well maintained as well.

      My modern fridge uses the same power as my old one when it was new. The difference is its 3x the size, and the old one wasn't new, it had leaky seals and a barely functioning defrosting system turning the freezer into an inefficient ice

      • Landlords do have incentive to offer units with higher end appliances -- higher rent. If they want to charge more, they need to provide a more luxury product. The issue is, if they are offering 'affordable' rental units, then the units need also be affordable for the owner.

  • by FeelGood314 ( 2516288 ) on Sunday June 04, 2023 @10:46AM (#63575203)
    I worked in this field for 15 years and the author and all the other l illiberal, woke, virtue signaling morons are making it harder to go green. Rich people consume more energy and they also have the flexibility to change their habits. We could easily cut a non-trivial amount of green house gas emissions from electricity production and save money if we let rich people pay the spot price for electricity. When the wind blows and the sun is out the spot price drops to nearly zero, on winter evenings the spot price in Ontario, Ohio and Pennsylvania regularly goes negative. I've done pilots of 100,000 plus people that have shown that with minimal help rich people will change their consumption habits to match renewable energy production. Poorer people can't though and it shouldn't matter because the poorest 15% of people living without AC in a multi dwelling unit consume so little power we should be ignoring them and concentrating on the richer 85%. However, since it saves rich people money, whining losers like the author of this article, will insist that any program be offered to 95% of people served by a utility. Unfortunately there are some hard technical problems getting to 95% and the one f$@king time in Texas where we proved we could get to 95% required subsidizing low income households but when we did that we got sued because we were not supposed to have a list of low income households.
  • by Cask Strength ( 10330323 ) on Sunday June 04, 2023 @10:52AM (#63575213)
    They have been copy/pasta covenants for decades and they always say "no solar". Then there is the huge lot of sociopaths that love to use HOAs to bully their neighbors around (who will subsequently respond by pretending that it protects property values and cars on cinder blocks... studies have actually shown that homes in HOA neighborhoods have 10% depressed values as compared to non-HOA homes and if you live in a nicer home you're 1) very unlikely to put some junk in your yard, and 2) already live with some local government entity [a municipality or county government] that has health & safety regulations). Bottom line: HOAs are only valuable for shared property. That can mean multi-family homes to do maintainance on things like shared roofs or neighborhoods with common areas. The "standards" and other BS are simply for the mentally deranged to hide their behavior behind so that they don't get criminal charges against them for their behavior.
  • A government incentive program is in place to encourage the replacement of existing systems. Landlords are not eligible as per the summary. So why would they invest in upgrading a working system? If the tenant doesn't want to leave money behind why should the landlord? You could also say that what's stopping them is also energy efficient companies wanting a profit.

    It's a poorly devised incentive program that was intended to get votes rather than address the problem.

  • The US currently allegedly has an acute housing shortage. What does that mean? It means that (a) it is not sufficiently cost-effective for people to spend capital to build housing at the rate and of the type deemed necessary to avoid shortage, and (b) the government does not want for its own reasons to spend money to do the same, because, er, it is not cost-effective.

    If you remove landlords from the equation, i.e. private capital, the situation will be much much worse.

    The problem right now is that renters

  • by RJFerret ( 1279530 ) on Sunday June 04, 2023 @12:11PM (#63575367)

    The blue recycling bins are right next to the trash bins, but most tenants ignore them (only one in the past two decades has consistently used them).
    Now we have green bags for compost too (tenants never have used).

    The blurb does miss that insulation, updated windows and energy saving new appliances are marketing that do cause tenants to choose to rent "here" instead of elsewhere, many do ask about such.

  • by Maclir ( 33773 ) on Sunday June 04, 2023 @12:27PM (#63575397) Journal

    I would love to ditch my expensive electric clothes dryer, and dry my clothes using a combination of solar and wind power, using a clothes line in my back yard. But the HOA doesn't allow such things, because 'it will lower the tone of the neighborhood and reduce property values'.

  • renters use almost 3 percent more energy than homeowners

    There is no way in hell renters use even close to as much energy as homeowners. On average homeowners have a lot more square footage per person, and don't have anybody above or below them (which increases heating/cooling cost), have larger refrigerators, their own washer/dryer, and on and on...

    I'm not saying the 3% is bogus, I'm saying that model must have a lot of "corrections" for the above factors (and more) try to factor out the impact of the s

  • My power company offers community solar. That is where you lease a block of panels are in a large solar farm, and get credited whatever they produce against the kWh on your residential meter. This works for tenants, and home-owners whose house faces the wrong way or is shaded by trees. It is also a month-to-month lease, and there is no setup fee.

  • So, I'm betting the same people advocating for this also scream about affordable housing. If you make property owners make expensive upgrades, they can only afford to if they raise rent. They need to recoup their expenses. Forcing more expenses on rental owners will only drive out the small landlords and concentrate rentals more and more with large corporations that have the deep pockets and large property profile to split the costs across. We're already seeing that in locales that are enacting rent con

  • What is NYC going to do when the cost of housing increases by an order of magnitude?

  • Here in New Zealand landlords are now required to meet minimum standards around such things, so when the law was changed to do that landlords suddenly had a lot of expense around insulation and heat pumps etc. I was a landlord back then and was already making a loss on the rental income vs the mortgage repayments, and my tenants were living in a better house than the one I lived in. I sold that house and used the profit to improve the efficiency of my own house. I now live in a warmer house with less deb
  • "Poem by Tyrone Green"

    Black fog belching
    In the dead of night
    Bill My Landlord
    Bill My Landlord

    Rooftop Solar
    Battery at night
    Bill My Landlord
    Bill My Landlord

    Telsa wall I can't install
    That would make grid usage fall
    Bill My Landlord
    Bill My Landlord

    B.I.L...My Land-Lord

  • Make it mandatory for landlord to offer an energy-cost-inclusive option for the rent for a prescribed premium over the actual rent. For example, you could mandate that each property has a per-square-metre premium over rent that a renter could opt for, with the premium reflecting a well-insulated house. This would incentivise the landlord to fix the house to reduce costs because they would be on the hook if the tenant took up the option.

  • To support the "split incentive problem," the article mentions this study [sciencedirect.com]: "According to one study from 2018, renters use almost 3 percent more energy than homeowners thanks to the split incentive problem."

    Unfortunately, the paper from that study is paywalled. Fortunately, there is an abstract on the webpage. From that abstract, it's apparent that the study looks at differences in the specs (of "natural gas-fired boilers, multi-paned windows, and caulking" and "appliances" and "insulation and thermostat

  • The current setups in subsidies are a joke .
    First, it should stop all government subsidies on utilities level .
    secondly, a new regulation should be require new buildings under 6 stories to have enough on-site, unsubsidized AE to exceed HVACs BTUs.
    thirdly, in 5 years require the same on all sold homes, OR where renters turn over.

    these simple regulations not only kill the building emission, but it also kill the subsidies , then uses high prices of AE to stop nat gas in hvac.

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