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Nobody has incentives or cashflow that will change this. At best if we built more housing it's something landlords might face competitive pressure over. In which case it might change. But currently cases where someone has a choice between two equivalent rentals and can try to pick the efficient one are pretty few and far between. Most people just try to balance as low of a monthly rent payment as possible with their commute and not having to rent from a slumlord type.
You're describing a problem which regulation is designed to fix. People argue about how effective that is, and post counter intuitive outcomes, but I think the central point remains: there's little evidence a deregulated housing market fixes it either.
Corporate landlords probably have more motivation to repect enforced obligations. So the ultimate corporate landlord is some level of government, and then we've arrived where I think we should be: public housing is a right.
New Zealand recently brought in some minimum requirements around insulation.
It’s a low bar, and even lower when you know how poor the average house quality is within New Zealand.
The average European house is ludicrous hot inside compared to NZ housing.
In my area you can request the last 12 months of utility costs for most properties. It doesn't reflect everything, but the transparency is helpful.
This is a silly study.
Home efficiency matters to people who own a home, not renters. Renters only care about making rent and being able to eat. They don’t have the luxury of thinking about energy saving appliances when the landlord hasn’t fixed the appliances they do have. Renters are trapped with capped wages and increasing rents.
Renters often pay for utilities.
Yes, what they don’t do is pay for a new fridge. Or energy efficient windows.
It's quite common for utilities like water and gas to be shared, where the renter is billed proportionally to the usage of the entire block/rental complex.
Plus, people generally aren't doing chores or using appliances unnecessarily. That means it's difficult to find ways to save meaningful amounts of energy other than adjusting the thermostat. Most household energy use outside heating /cooling comes from the appliances they can't upgrade, so the alternatives are quality of life issues like fewer showers and less laundry.
If you had two identical looking houses for identical rent, one could cost $100/mo to heat/cool and the other could cost $300. This isn't really something that renters are realistically able to discriminate on.
I would support a law that makes this a required disclosure in rental listings, like asbestos.
In some cities, commercial buildings are issues a public facing grade on their energy efficiency. Why not other forms of commercial real estate like multifamily?
The status quo is the energy costs are hidden and only revealed one month after you move in.
>This isn't really something that renters are realistically able to discriminate on.
Surely they can ask for what the expected utilities are? Failing that, asking for what the trailing 12 month's bills were.
Except a lot of renters (including this one) pay their own utilities.
How many renters would even want to replace appliances, get new insulation installed, get all their lights replaced, etc.?
I had a bunch of work done after a kitchen fire in my house and it did genuinely cut my electrical bill. It also cost a lot of money and is something I wouldn't have done by choice especially in a rental property.
You would certainly need to be a serious long-term renter.
I purchased a home with a walk-out basement (brick exterior, cinder block foundation, >80% above grade). As it turned out, the prior owners had pulled a fast one and faked their framing with 1x4s and added no insulation. Our monthly power bills ranged from 400-500$ on a 2,000 sqft home.
I spent most of last year gutting the interior of the basement, framing, plumbing, electrical, insulation (R-13 fiberglass batt insulation), Sheetrock, paint, trim, flooring (laminate @ 2$ per sqft). I spent approximately $10k on this project doing the labor myself.
As a result, my bills are now in the 200-250 range. I had the insulation work done by 01/2025 for context. So, perhaps a new efficient water heater? But any serious work is unlikely to be worth the costs.
Replacing kitchen appliances is a quick job for common pieces like refrigerators. Most other kitchen appliances can be done in a day even if they're built-in as long as you get something that occupies the same space.
Insulation upgrades are heavy remodel jobs: Opening the walls requires people to leave the space for the duration of the job. Even if you can stack contractors back to back perfectly it's still a lot of time and displacement.
These things usually happen between renters when the space is vacant. In larger units you can some times shuffle renters between similar spaces but it's a huge pain and they usually don't want to do it.
I’ve lived in my rental for ~15 years now (rent control) - to be honest, if I’d known when I moved in how long I’d be here, I’d have paid for some upgrades. It’s not equity, but I do still live here.
I've done upgrades in rented apartments at my own cost because finding a rental with said upgrades already done was either outright impossible or would've cost even more in rent than the cost of the upgrades spread out over the leasing period.
Many. My entire apartment is filled with large single pane windows. There's zero draft sealing at any of them, nor the front door. I likely pay an additional $100 in electricity a month due to this.
It was noticeably reduced when I took the time to 3M wrap all my windows one winter, but I didn't want to do it again.
More directly, how many would want to pay for it to happen? Easy to say they would want the upgrade. Hard to say they would want increased rents.
There's the plug-in solar panel system. It's very easy to install. It's suitable for renters to add supplemental solar power with little cost and effort. It's portable enough that renters can bring them to their next rentals.
It's very popular in Germany, with several million units installed. They call it balcony solar panel. People hang the panels on their balconies in apartment buildings. Germany allows up to 800-watt systems.
It's a very simple system, a solar panel coupled with a micro inverter that converts DC to AC power. It is plugged into a regular wall outlet to provide additional power to the home. The added power is an additional source of electricity in addition to the grid. Any electrical devices drawing power from the circuit draw from the closet source first (due to Kirchhoff's Law), i.e. from the solar panel, then any additional need will be drawn from the farther away grid.
The micro inverter needs to be UL 16741 compliant for anti-islanding protection, to shut off in case the grid has shut power down, so that the solar panel won't back feed power into the grid.
In U.S., Utah has already passed a law to allow plug-in solar systems for up to 1200 watts without permit requirement and allowing back-feed into the grid. A few other states are considering.
There are limits to the power fed into a circuit. Normal household electrical wire can handle up to 15amp (1800 watts on 120V) of electric load. The plug-in power from the solar panels should not exceed the limit. This means the power generated is meant to supplement the household power need rather than completely covering it. Any reduction from the grid helps.
I talked to my city's (in California) building department. They haven't heard of it and need time to do research. The building inspector says that as long as the solar panels are not modifying the structure of the building (on roof or on wall), they don't care. They said putting the panels on the ground in the yard is fine.
> balcony solar
That's swell if you have a balcony facing the sun and enough space for 4m2 of solar without blocking your neighbors' sun. In my unit for example, it's completely infeasible.
its all a scam. every year everything gets more energy efficient but the cost of energy gets jacked up so u never win
>so u never win
So why do anything to improve rental units? Make them slightly better than a corrugated steel shack? No thanks, that just means the landlord can market it as a "luxury condo" and charge me up the ass for it. I'll live in my steel shack thank you very much.
Considering that tax credits cover only 1/3rd of the materials (not the installation) and have hard caps of 1,500 it should come as no surprise that landlords don’t care and won’t cover improvements. They’re not paying the power or suffering the cold at the end of the day.
This is pretty much it. Most renters are paying for utilities and don't realize why they're so high.
My kid has been renting the same apartment while in school and their fridge failed over the summer. She manages the utilities and mentioned that their power bill halved as a result of the replacement. She said what they were paying before didn't seem outrageous so it came as a surprise to see the newer bills were consistently half of what it had been before.
And the tenants have to be moved out of the unit and housed somewhere else during some of these renovations, which is going to cost the landlord far more than $1500.
This article is silly.
In the UK if you sell or rent out a house it has to have an energy certificate with a rating (specified by a letter). I'm pretty sure that you aren't allowed to rent out properties with less than a certain rating and that rating which is higher than you might expect.
This is true. The rating is actually pretty low though - they only need to be a band E on the EPC. It’s soon to be C though.
One of the… problems with that is that a lot of our housing stock is very old, and honestly not ever going to reach that. The grading don’t take partial improvements into account so if you do internal wall insulation on half your house it means absolutely nothing on the EPC. The means to get to C for older properties basically require insulation (not practical in pre cavity wall buildings without an ungodly amount of work) and renewable installs. That’s not to say we shouldn’t try but it’s a tall order to ask anyone to rip everything back to brick and build cavity walls in th pre 1930 stock (which there’s absolutely craploads of)
But surely a higher rating would generally commend higher rents meaning either way it's the landlord pocketing the savings and the tenant is no better?
Currently “E” without an exemption.
Most times your land lord won't let you make anything nicer. They basically want the place to degrade around you so that they can low key force you to leave causing you to abandon your rent control.
Most rentals across the US and even the world don't have rent control.
You've highlighted one of the downsides of rent control: It changes the incentive structure dramatically in ways that aren't always a win for the tenant. I had a friend in a rent controlled apartment who would quietly do things like upgrade his appliances and fix things because his rent was so low he didn't want to rock the boat for any reason at all.
Wouldn’t this be a negative unforeseen side effect of the rent control?
Could be solved with more free markets. What a funny phenomenon this is: "reluctance to make even basic upgrades" -- landlords don't care because they have too much market power and aren't even attempting to compete with each other.
Imagine if car makers didn't bother with fuel efficiency because buyers had almost no choice and any car is better than nothing. We'd say that market isn't functioning well. Perhaps the problem is caused by price caps so it's not worth carmakers competing, or perhaps the law limits the number of cars that can be produced so there's always a shortage. Or perhaps it's the soviet union and there's no incentive for them to improve anything because the planners haven't demanded that they do.
Car makers really don't care about fuel economy and have to be made to care about it by regulations and even those they try to skirt.
Why would a landlord care about expensive efficiency upgrade? They don't pay the utility bills. Efficiency upgrades would only justify a higher rent to cover the work. The upgrades would essentially be a "luxury" upgrade that would raise the rent in this free market scenario. Would the higher rent be offset by the utility savings? Probably not.
Assuming the work was free (it never would be but just go with it), the upgrade would save about $100/month in electricity. To a prospective tenant, that means they'd be willing to pay up to $100 more in rent to break even. Now since we live in the real world, that upgrade now has to be paid for. The work cost $4.8k and the landlord wants to pay for it over 2 years so now there's a $200/month increase. But the work will only save $100/month. The tenant is now paying an extra $100 in total living expenses. By the time the 2 years are up, the landlord isn't going to cut the rent by $200, he'll just continue to charge the same or more than what it was 2 years ago. The tenant will forever be paying that extra $100 in living expenses while the landlord gets to pocket an extra $200.
What's needed is a baseline of acceptable housing for tenants and rent controls that force the landlord to share at least some of the financial burden.
High efficiency apartments are actually kind of normal in newer more expensive rentals. Its the lower end rental properties that landlords think it doesn't make sense investing in; the rent increases that would come a long with the upgrades just wouldn't make sense for the market they are going for.
Available rentals are still priced according to their relative value.
If most landlords have newly updated units on the market for $2000/month and someone tries to rent a similar unit untouched since 1970 for $2000/month, that unrenovated unit is going to sit on the market for a very, very long time.
Rent control also causes this because they get no additional value from better units.
Cars are regulated for efficiency though, CAFE for instance.
Deregulation led to Enron. Next bright idea?
You're exactly right and the economics of it are pretty well studied. I know quite a few people in real estate, they're always eager to upgrade their property (read: make it more valuable) because then they can make more money. If their price is capped, though, they just don't make the investment. Rightly so, but at the end of the day, the renter is the one getting ripped off by the politician he voted for because the rent was too damn high.
Just let people create value and trade.
PS: Sad that you're getting downvotes for a thoughtful, polite comment, too. Downvotes are for hiding idiocy and meanness, not viewpoints that you disagree with.
There is always going to be an adversarial relationship between landlords and renters. Make no mistake: that we allow this to happen is state violence. Why? Because we are allowing individuals and corporations to deny housing to people by raising prices to make it unaffordable. We even allow them to collude [1].
The only solution to this that demonstrably works is for the state to provide a significant amount of housing to keep the private secotr honest [2].
Everything else is just propping a system that steals from the poor to give to the already rich.
[1]: https://www.justice.gov/archives/opa/pr/justice-department-s...
What I don't get is what are you really supposed to do if you don't want to buy a house and being a landlord is illegal? I often hear people online say that being a landlord is incredibly unethical, but I have no interest in buying a house. So I don't understand how someone is wronging me by renting me one. And I'm in a lucky situation where I probably could afford to buy a house if I wanted to. Many people could not.
That said, I would obviously support the government building a large amount of high quality housing, assuming they could do it at a reasonable price.
Why yes, those evil wallstreet adjacent millionaire landlords who may rent out their basement to keep the lights on, are evil lizard people.