As climate concerns grow, the nation’s aging housing stock is receiving more attention. Older homes, especially those built to pre-1980s building codes, are considerably less energy efficient than homes built after the year 2000.
With more than half of the owner-occupied homes in the U.S. built before 1980 and roughly 38% built before 1970, meaningful reductions in home energy use will depend on retrofits of these older structures. The push to diminish greenhouse gas emissions will create opportunities for remodelers as policymakers recognize that meaningful energy-use reductions cannot be achieved unless we update older homes.
Homes built before the 2000 International Residential Code and subsequent editions are not as energy-efficient as homes built today. As remodelers retrofit those homes for energy efficiency, they also improve their resistance to natural disasters.
The median age of owner-occupied homes is 39 years but varies across states, according to NAHB economists.
New York has the oldest owner-occupied homes with a median age of 60 years, with other New England states hovering near 55 years. Newer housing stock is mostly concentrated in Sun Belt states.
The Northeast also has the worst climate, according to 2022 NAHB Remodelers Chair Kurt Clason, owner of Clason Remodeling Co. in Ossipee, N.H. Clason says there are houses he walks into where you can almost feel a steady breeze. Every remodel in his area has had some phase of an energy upgrade.
Energy Spending is Up
An analysis of government data by the Harvard Joint Center for Housing Studies shows spending on energy-sensitive remodeling is a large, growing share of the home improvement market. The data, presented at the Remodeling Futures Conference in Boston this April, shows younger and higher-income homeowners are among those most likely to make energy-efficiency upgrades.
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Clason and NAHB Remodelers member Bill Owens, president and CEO of Owens Construction Contracting Co. in Worthington, Ohio, attended the Remodeling Futures Conference. Both agree that younger homeowners are embracing the idea of energy upgrades and are more conscious of the idea of global warming. They also tend to take their return on investment more seriously.
Rising energy costs are also driving interest in energy retrofits. While most consumers have seen the surging prices at the gas pump, many are now also seeing the cost of electricity and natural gas on the rise.
Owens says the last time he saw such an increase in the number of projects looking at doing a fuel assessment and energy-efficiency updates was 2005 when gasoline prices surged to over $4 a gallon. The latest Bureau of Labor Statistics data shows the gasoline index alone rose more than 18% in March and contributed to more than half of the Consumer Price Index’s monthly rise.
According to the Department of Energy, homeowners spend more than $100 billion annually on major remodeling projects, including envelope replacement projects. Concerns about climate change and growing angst about rising energy costs are driving interest in a wide range of home retrofits and updates.
Keep up to date on the market opportunities at nahb.org