Cap and Trade will destroy Real Estate ownership

By
Real Estate Agent with RE/MAX First

Among other provisions that control nearly every aspect of our lives, the Waxman-Markley energy bill has a requirement that forces the entire United States to use a National Building Code based on the green building standards of California. Regardless of whether your house is in Miami, Florida or Bangor, Maine, you'll have to adhere to the standards used in a state that has one of the most moderate climates in the U.S. The construction industry is really going to suffer.

The bill forces sellers to have an energy inspection prior to being able to sell their home. Windows, appliances and insulation will have to be inspected and approved by a government inspector and modifications would have to be made for compliance before you can close the sale.

Basically, you won't be able to sell until you go through the expense of bringing your house up to the new code. This will cost a prohibitive amount in many cases. For example, let's say that you own an older house which you bought in 2003 for $250,000 and you now need to sell. Not only has the value fallen to or below the level of the mortgage due the the drop in prices, but you are now faced with re-insulating the entire house, installing new windows, and changing the HVAC & other appliances. The total cost for this type of renovation might easily come to well over 10% of the house's value.

It begins to look as if defaulting on the mortgage might become even more common. The real tradegy is that low income families are more likely to live in older houses which won't meet the new standards and which will require major upgrades. I thought that we weren't going to see any new taxes on people who make less than $250,000. What a cruel joke!

If you want to sell, you'd better do it now, just in case the administration is successful and gets the bill passed by the Senate. Of course, this means that housing inventory will go up and prices will necessarily go down just at the time that interest rates are predicted to go up. Oh, wait! Isn't this just going to add to the housing crisis? I don't know, maybe it's just me...

The bill even mandates that all energy efficiency evaluations of one particular type must be performed by one single company, regardless of where in the U.S. the house is located. Wow! I'd sure like to own that company. I wonder who does?

To further compound the irony, the EPA has now released a new study which states that the average temperature of the Earth is in decline. It seems that this data has been available for some time, but is only now being released. Hmmm!

Woops! Since I wrote this, the EPA has suppressed the study again. I guess it was an inconvenient time.

Of course, this bill has to pass the Senate and then go to the reconciliation committee before it goes to the President to be signed into law. The White House is deviously trying to push off the Senate's consideration of the bill until sometime in September after they have voted on the horrendous, healthcare-rationing bill. By then, I expect that they think that the average citizen will have forgotten all about what Cap and Trade is going to do. The only good thing about this delay is that there's time to let your Senators know what you think about this massive bill which will make all aspects of our lives far more expensive and destroy American industry and competitiveness.

 

Comments (1)

Fred Griffin Florida Real Estate
Fred Griffin Real Estate - Tallahassee, FL
Licensed Florida Real Estate Broker

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Jan 21, 2018 07:18 AM