In a study just released by the Center for Housing Policy home values may be sliding, but housing costs just keep rising. In the report, the Washington, D.C. based group noted that housing costs have jumped nearly 65% between 1996 and 2006, far outpacing the increases for food, transportation, and health care over the same period.
Overall, homeowners increased the percentage of their household income spent on housing by 4.7% between 1996 and 2006, to 26.2%, according to the report. Over the decade, every major category of homeowner expenses increased faster than incomes the report states. Mortgage payments increased 46%, utilities 43%, property taxes 66%, and property insurance 83%. By contrast, homeowner incomes increased by 36.3%.
That disconnect between housing costs and income has proved particularly problematic as home prices have eroded and the economy has struggled. The Wall Street Journal reported today that nearly one in 6 homeowners owes more on their mortgage than their house is worth.
“By documenting the substantial increases in a wide variety of housing expenses, this study shows that the nation’s housing concerns extend beyond higher mortgage payments,” said John McIlwain, chairman of the Center for Housing Policy.
So the question becomes what can we do to control these expenses? RASTRA contributes in several areas.
- Using RASTRA to construct the exterior walls lowers energy consumption by up to 50%. This helps protect homeowners from the volatility of energy prices. While we can’t control the cost of energy we can reduce how much energy we use.
- RASTRA creates a stronger and safer home, insurance rates are lower, especially in high risk areas where severe weather is consistently present.
- Maintenance expense which was not mentioned in the study is also lower with RASTRA. Because wood that rots is replaced and the fact that HVAC systems don’t work as hard to control the indoor climate, savings are realized.
- Reduced interest rates are available from some lenders for more energy-efficient new homes.
- Energy-efficient homes hold their value and even appreciate more than a home that’s not considered energy-efficient. According to the National association of Realtors for every $1 saved annually in energy expense, home value is increased by $20 at time of resale.
- Tax benefits are available for certified energy-efficient homes and building RASTRA alone usually satisfies these requirements.
I’m not suggesting that RASTRA is the cure all to the housing crisis, but we do make an impact. Can you say the same for wood frame walls?
Thanks for visiting.