‘We’re heading into a housing recession’: Here’s what the NAHB CEO sees in real estate right now — and why it spells trouble for the economy
Vishesh Raisinghani – August 7, 2022
Housing, which is a key segment of the national economy, looks extraordinarily weak right now, according to a recent report by the National Association of Home Builders (NAHB).
‘We’re heading into a housing recession’: Here’s what the NAHB CEO sees in real estate right now — and why it spells trouble for the economy
“We’re heading into a recession,” NAHB CEO Jerry Howard told Bloomberg in a recent interview. He described how a rapid decline in homebuilding and demand for new homes could drag the national economy lower.
Here are some of the highlights of Howard’s thesis.
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Housing leads every recession since Second World War
Residential real estate is an integral part of the American economy. In fact, housing activity contributes between 15% to 18% of gross domestic product (GDP) every year, according to the NAHB. A slowdown in this sector naturally pulls down the rest of the economy.
A decline in home building and buying has led to every recession since the end of the Second World War, according to Howard. The association’s latest report indicates that buyers and builders are both pulling back from the market yet again, which could be a leading indicator for another recession on the horizon in 2022.
Builders are holding off
Homebuilders face multiple demand- and supply-side pressures.
On the demand front, potential homebuyers have receded from the market. Existing home sales slid 5.4% in June. Meanwhile, borrowing capacity has been curtailed by rising interest rates. The average mortgage rate has accelerated at the fastest pace in 35 years. A 15-year fixed rate mortgage is now about 4.8%, up from 2.2% a year ago. These factors have effectively destroyed demand.
Meanwhile, the supply chain for home building material and the cost of labor continues to increase the cost of building new homes. This is why homebuilders’ sentiment dropped 12 points in June, according to the NAHB survey.
A dangerous situation
The fundamental weakness in both demand and supply-side factors creates a “dangerous situation,” said Howard. Housing has not only led the country into every recession, but it has also led the nation out of every recession since the Second World War. This time the recovery could be slower.
There’s no easy solution to the lack of labor and supply chain disruptions that plague the industry. If these issues persist, the economic recovery could take longer. Howard believes regulators need to get involved to reignite growth.
Regulators need to get serious
Policy changes are essential to resolve issues in the housing market, according to Howard. He suggests that regulators try to secure a deal with Canadian authorities to improve the supply of lumber into the U.S. That would significantly reduce the cost pressures on homebuilders.
Policies to encourage labor supply would also help. Better training for skilled labor and higher immigration of tradespeople would improve homebuilder sentiment.
Some regulations, however, need to be reduced to boost the homebuilding sector. Development charges and prohibitive planning regulations on the state and local level could be a bottleneck on housing supply.
Lowering these barriers could play a part in stabilizing homebuilding and helping the national economy course-correct. However, these recommendations may not be enough to prevent the near-term pressures homebuilders face.
Some economists believe a housing-led recession may be inevitable — if it hasn’t already begun.
Las Vegas, NM declares emergency, with less than 50 days of clean water supply left
Nadine El – Bawabn – July 29, 2022
The city of Las Vegas has declared an emergency over its water supply after the Calf Canyon-Hermits Peak Fire, the largest wildfire in New Mexico history, contaminated the Gallinas River. The city relies solely on water from the river, which has been tainted with large amounts of fire-related debris and ash, according to city officials.
New Mexico Gov. Michelle Grisham said in a tweet that $2.25 million in state funding has been made available to ensure residents receive access to safe drinking water.
The city is currently relying on reservoirs which, at the current consumption rate, contain less than 50 days worth of stored water, according to Las Vegas Mayor Louie Trujillo.
PHOTO: A gauge measures water levels on the Rio Nambe amid extreme drought conditions in the area on June 3, 2022 near Nambe, N.M. According to the U.S. Drought Monitor, 90 percent of New Mexico is experiencing extreme drought conditions. (Mario Tama/Getty Images, FILE)
The large amounts of ash and turbidity in the river have prevented the city from being able to pull water from it, as the city’s municipal water treatment facility is not able to treat the contaminated water, according to the mayor.
Related video: NASA releases startling image of Lake Mead shrinkage
0:04 1:48 NASA releases startling image of Lake Mead shrinkage for some 40 million Americans. Scroll back up to restore default view.
The Hermit’s Peak Fire and Calf Canyon Fire merged on April 27. By May 2, the blaze had grown in size and caused evacuations in multiple villages and communities in San Miguel County and Mora County.
PHOTO: Smoke billows from the Hermits Peak and Calf Canyon fire, outside of Las Vegas, N.M., May 11, 2022. (Adria Malcolm/Reuters, FILE)
President Joe Biden issued a major disaster declarations for the New Mexico counties of Colfax, Mora and San Miguel on May 4.
The fire resulted in the loss of federal, state, local, tribal and private property including thousands of acres of the watershed for the Gallinas River, the primary source of municipal water for the city and surrounding areas, according to the emergency declaration.
The Gallinas River has resulted in thousands of acres of scorched forest, flooding, ash and fire debris.
‘Things Are Going to Break’: Texas Power Plants Are Running Nonstop
Will Wade, Mark Chediak and Naureen Malik – July 15, 2022
(Bloomberg) — As searing Texas heat drives power demand to record highs, the state’s grid operator is ordering plants to run at a historic pace, often forcing them to put off maintenance to keep cranking out electricity. That’s helped keep the lights on, for now, but the short-term focus is putting even more stress on a system that’s already stretched near the limit.
Twice in the past week, officials have called on Texans to limit electricity use during scorching afternoons as demand inched perilously close to overwhelming supply. Now, there are growing concerns over how long power plants can maintain the grueling pace as they run nonstop, according to Michele Richmond, executive director of Texas Competitive Power Advocates, a generator industry group.
“Things are going to break,” she said. “We have an aging fleet that’s being run harder than it’s ever been run.”
Also See: Texas Confident Stressed Grid Will Hold Up Amid Summer Heat
To meet the surge in power demand, Ercot, the grid operator, is leaning heavily on a mechanism called reliability unit commitments to ensure there’s enough supply. Plants are being regularly ordered to go into service, or remain in operation, and skip any scheduled maintenance. The measure also overrides shutdowns for economic factors or any other issues. And Ercot is using the rule more than ever before as the state battles bout after bout of extreme weather.
The Electric Reliability Council of Texas, as the operator is formally known, called for 2,890 hours of RUCs system-wide in the first half of this year. That’s more than triple the 801 hours in the first half of 2021, according to data from Ercot’s independent market monitor provided by Richmond. For all of 2020, there were 224 RUC hours.
The problem is that deferring repairs now will likely come back to haunt power-plant owners, Richmond said.
“If you put off preventative maintenance because it’s needed for reliability, it increases the chances you’ll need a more comprehensive outage” later on as plants start to malfunction, she said.
Growing Population, Crypto
The situation underscores that the Texas grid is relying on short-term solutions for what’s poised to be a long-term problem. The state is contending with a population boom that’s driven demand higher. Crypto mining has also taken off in the past year, bringing with it the industry’s power-intensive operations. Meanwhile climate change has made extreme weather events that drive up electricity use more likely to occur and more severe — creating situations like a deadly February 2021 freeze that caused blackouts across the state.
Brad Jones, Ercot’s interim chief executive officer, is aware he’s walking a fine line. On one hand, there have been six times in the past year that using RUCs have enabled the operator to avoid declaring grid emergencies. Or as Peter Lake, chairman of the Public Utility Commission of Texas, said at a June 22 hearing: Six times when the grid otherwise would’ve been “on the brink of rolling blackouts.”
However, Jones says he knows that forcing plants to stay in service is raising the risk of breakdowns. For example, a key concern at this time of year is boiler-tube leaks, especially at older plants. These leaks don’t always mean a plant must shut down immediately, but if they’re not closely monitored they can lead to bigger, more costly repairs.
“Typically, a generator can run for a while with the water leaking,” Jones said in an interview. “The question is, how long is that.”
The grid operator is in constant contact with generators and works to give them time to make needed repairs when conditions allow, Jones said. Ultimately, the state needs more power plants, and regulators are working on ways to make that happen, he said.
Ercot and other operators are facing dual challenges, said Michael Webber, an energy-resources professor at the University of Texas at Austin. Most companies schedule maintenance during the spring and fall, when the weather is mild and power use is typically lower.
But climate change means these windows of temperate weather are getting shorter. This year, for instance, an early May heat wave forced some generators to skip tune-ups. And periods of high heat are also lasting longer, putting more stress on power plants that are running all-out for weeks at a time.
Maintenance for power plants — especially older ones — can be time consuming and complicated, said Webber, who also serves as chief technology officer of Energy Impact Partners, a clean tech venture fund
“You kind of have to dismantle the plant,” he said. “It’s not something you can do in a couple of hours.”
All of this is exacerbated by the state’s aging fleet. The average age of coal-powered plants in Texas is about 50 years, and natural-gas plants average about 30 years.
“It’s kind of like humans — we need to rest and recover,” Webber said. “If we run full speed for a long time, we can collapse.”
Sophie Kasakove and Robert Gebeloff – July 7, 2022
A street with a new apartment complex under construction in in the East Nashville neighborhood of Nashville, Tenn., on May 11, 2022. (September Dawn Bottoms/The New York Times)
NASHVILLE, Tenn. — When Ashley Broadnax thinks of the East Nashville, Tennessee, neighborhood she grew up in during the ’90s, the images that rush in have a modest, middle-class tinge.
After school, she and other neighborhood children bought snacks at the corner store and threw balls on the street as their parents returned home, some in uniform from blue-collar work, others from jobs as teachers or office workers. Neighbors chatted on porches and lawns of unassuming single-story homes. There were some poor families and a few wealthy ones, but more than one-third of her neighbors made between $40,000 and $75,000 in today’s dollars — enough to live comfortably.
But by 2020, the income distribution had tilted so that half the families made $100,000 or more, census data shows. All across the neighborhood, the modest houses of Broadnax’s youth have been replaced by high-end townhomes known informally as “tall skinnies” that tower over the remaining older homes.
So when it was Broadnax’s turn to pay the rent, using her middle-income salary as an educator, the cost was out of reach.
Like many other Americans, Nashville residents are increasingly being buffeted by economic tides that push them into neighborhoods that are either much richer or much poorer than the regional norm, a New York Times analysis has found. A smaller share of families are living in middle-class neighborhoods, places where incomes are typically within 25% of the regional median.
In Nashville, the share of families living in middle-class neighborhoods dropped by 15 percentage points between 1990 and 2020. But the portion of families in wealthy ones jumped by 11 points, and the segment living in poor neighborhoods grew by 4 points.
In some ways, the pattern reflects how wealthy Americans are choosing to live near other wealthy people, and how poorer Americans are struggling to get by.
But the pattern also indicates a broader trend of income inequality in the economy, as the population of families making more than $100,000 has grown much faster than other groups, even after adjusting for inflation, and the number of families earning less than $40,000 has increased at twice the rate as families in the middle.
Broadnax has become part of a great chase nationally for affordable housing. High rents in the city initially sent her to the more affordable Antioch neighborhood in 2011. But home prices nearly doubled there since 2018, so buying a home meant moving farther out to a suburban community called La Vergne.
“The same people that’s working in their city can’t afford to live in their city,” Broadnax said about Nashville.
Nationally, only half of American families living in metropolitan areas can say that their neighborhood income level is within 25% of the regional median. A generation ago, 62% of families lived in these middle-income neighborhoods.
“People are getting pushed out, and that is breaking up some historically sort of working-class neighborhoods,” said Marybeth Shinn, a Vanderbilt University professor who studies homelessness and social exclusion. “You gradually convert a neighborhood from a pretty modest kind of neighborhood that a lot of people could live in to one where only people that have a little more means are able to live in.”
That evolution has mixed consequences for people seeing their neighborhoods change.
When Jim Polk bought his home in East Nashville in 1979, the community left some amenities to be desired. The park near his house was rundown, and the neighborhood had few sidewalks or streetlights.
As the firefighters, nurses and local government employees in the neighborhood were replaced by tech workers, engineers and lawyers, Polk mourned the loss of their old, familiar neighborhood where his four daughters had learned to accept people of diverse backgrounds.
“So many families have moved out over time,” said Polk, who worked for decades as a community education coordinator for the city public schools. “It didn’t remind them of the place they used to live, and it was so expensive to stay.”
But Polk and his wife were able to keep up with the property tax increases on their city pensions, and they could not ignore the improvements to the neighborhood: New sidewalks and streetlights were installed, and the long-neglected park was cleaned up. When his church was destroyed by a tornado in 2020, his new neighbors had the resources to help the congregation buy a new building.
Even more significant has been the rapid price appreciation of homes in the neighborhood.Polk bought his home for $36,000. A home just across the street sold for more than $1.5 million in February, according to Zillow.
“There have been improvements in services available to the people living in the neighborhood,” he said. “But who gets to participate?”
Experts say the changes in housing patterns represent a form of economic segregation, as Americans are less likely to live in neighborhoods with people from other socioeconomic classes. Economic segregation exacerbates the problems often associated with income inequality. There are what researchers call “neighborhood effects,” with studies finding that poor children have better odds of climbing the socioeconomic ladder if they grow up outside of concentrated poverty.
And wealthy neighborhoods tend to command a disproportionate share of resources, such as better schools, more parks and greater access to health professionals.
This economic segregation not only “concentrates low-income families in high poverty neighborhoods, but it concentrates affluent families in affluent neighborhoods, where they can engage in a kind of opportunity hoarding,” said Sean F. Reardon, a sociologist at Stanford University. He and another sociologist, Kendra Bischoff of Cornell University, have written several papers on economic segregation.
Consider Durham, North Carolina.
Since 1990, a surge of wealth and investment has poured into the city’s downtown. At the same time, the percentage of families living in lower-income neighborhoods has doubled.
Turquoise LeJeune Parker, an elementary school technology instructor, said the split reality of rich and poor neighborhoods did her low-income students no good. Describing what she saw as the prevailing mindset of people flocking to prosperous parts of town, she said, “We won’t push for resources for our schools, we won’t push for any of that because ‘I’ve got what I need on my side of the city, so I’m good.’ ”
To some degree, economic segregation has gone hand in hand with the hollowing out of the middle class in general.
At the same time, local governments across the country have done little to maintain or expand affordable housing, instead investing in attracting highly paid workers, which drives up prices and displaces lower-income residents.
And exclusionary zoning laws often prevent denser, lower-cost housing from being built in high-end enclaves — Tennessee has even barred cities from putting zoning laws into place that would protect affordability. Property taxes on many homes have spiked, pushing longtime residents to sell to investors.
But whatever the cause, similar trends can be seen across the country.
In the Boston metropolitan area, middle class neighborhoods have shifted in both directions. In the 1990s and 2000s, many fell behind economically. In the past decade, because of widespread gentrification in the city, many modest neighborhoods have been transformed into much wealthier ones.
A generation ago, Seattle’s tech industry was starting to boom, but the area also was a major manufacturing hub, and 7 out of 10 families lived in middle-class neighborhoods. Today, only 5 out of 10 do. Nearly one-third live in wealthy enclaves.
In the Midwest, the share of families living in middle-class neighborhoods fell by 13 percentage points in Columbus, Ohio, since 1990, by 12 in Chicago, and by nine in Indianapolis.
And in Orlando, nearly 70% of area residents lived in “average” neighborhoods in 1990, according to census data. In 2020, the same was true for just 46%.
That leaves a lot of people feeling like they’re on the outside looking in.
Michael Street is a union electrician who moved from Nashville to Goodlettsville, Tennessee, about 25 minutes away. He said he spent his days driving around Nashville, working on houses that have all been rehabbed, rebuilt or rendered unrecognizable in neighborhoods he can no longer afford.
“Either you’re poor, or you’re rich,” he said. “Middle class is kind of phasing out. Either you have a lot of money, or you’re just barely getting by.”
—
Methodology
To measure the growing level of economic segregation in the U.S., the Times used census data to compare the median family income of every census tract with the median for the surrounding metropolitan area for the years 1990, 2000, 2010 and 2020. The analysis counted how many families lived in middle-class tracts, where the median family income was within 25% of the regional median, and how many lived in tracts where the income level was 25% or more above or below the regional median. All figures were inflation-adjusted to 2020 values.
Source data and maps were from socialexplorer.com and nhgis.org.
Supreme Court Justice Clarence Thomas told his law clerks in the ’90s that he wanted to serve for 43 years to make liberals’ lives ‘miserable’
Katherine Tangalakis-Lippert – June 25, 2022
In a 1993 New York Times article, a former law clerk of Clarence Thomas said he held a grudge against liberals.
The conservative Supreme Court Justice was resentful of the media coverage of his confirmation hearing.
“The liberals made my life miserable … and I’m going to make their lives miserable,” NYT reported he said.
Supreme Court Justice Clarence Thomas told his law clerks he intended to serve on the highest court of the land to make the lives of liberals “miserable,” according to a 1993 report from The New York Times.
Thomas, who was confirmed to the Supreme Court in 1991 amid contentious confirmation hearings, resented the media coverage surrounding his appointment. Central to the hearings were accusations and testimony about alleged sexual harassment of one of his subordinates, Anita Hill, who accused the justice of repeated, unwanted sexual advances and inappropriate conduct in the workplace.
He was ultimately confirmed in a 52-48 vote.
In a conversation with his law clerks two years following his confirmation, The New York Times reported Thomas expressed his desire to serve on the court until the year 2034.
“The liberals made my life miserable for 43 years,” a former clerk remembered Thomas – who was 43 years old when confirmed – saying, according to The New York Times. “And I’m going to make their lives miserable for 43 years.”
Thomas, considered the most conservative justice on the court, joined the majority opinion on Friday which overturned federal abortion protections established in Roe v. Wade. In a concurring opinion, Thomas indicated he also believes the Supreme Court should “reconsider” decisions from the cases Griswold, Lawrence, and Obergefell, which established the federal right to use birth control and legalized same-sex activity and gay marriage, respectively.
California’s largest reservoirs at critically low levels – signaling a dry summer ahead
Maanvi Singh – June 24, 2022
Photograph: Josh Edelson/AFP/Getty Images
California’s two largest reservoirs are at critically low levels, signaling that the state, like much of the US west, can expect a searing, dry summer ahead.
This week, officials confirmed that Lake Oroville, the state’s second-largest reservoir, was at just 55% of its total capacity when it reached its highest level for the year last month. Meanwhile, Shasta Lake, California’s largest reservoir, was at 40% capacity last month – after the state endured its driest start to a year since the late 19th century.
It’s a dire sign for a state already struggling to manage water during the most severe megadrought in 1,200 years. The glittering turquoise water in both lakes have receded to expose dry, brown lake bed. Dramatic visuals compiled by the department of water resources contrast images of an abundant Oroville in 2019 with this year – when officials say the lake saw a “show a shocking drop in water levels”.
Only five years ago, in February 2017, Oroville was so full that millions of gallons of water eroded the main spillway of its dam, which is the tallest in the US, forcing evacuation of nearly 200,000 residents downstream.
This year, millions in the state are already subject to unprecedented water restrictions and many in rural areas are expecting their wells to run dry within months, if not weeks.
“I feel I might have become a bit numb to both the numerical records and then the scenes of drought,” said John Abatzoglou, a climatologist at the University of California, Merced. “And that just reflects how rough the last three years have been for the state.”
Oroville is not as badly off this year as it was last year, when dozens of houseboats were hauled out of the lake because there wasn’t enough water to support them, and one of the state’s largest hydroelectric power plants was shut down for the first time since it was built in 1967.
“While we don’t expect every year to be as dry as this year or last, we have trended in California in the broader south-west towards a more arid climate,” Abatzoglou said. “Meaning that water is becoming more and more scarce.”
The Oroville and Shasta reservoirs back up the two largest dams in the state. Oroville is central to the State Water Project system, which can service up to 27 million Californians and 750,000 acres of farmland. And Shasta is the key reservoir in the federal Central Valley Project, which serves areas as far north as Redding – all the way south into Bakersfield.
A section of a drought-stricken Shasta Lake sits mostly dry. Photograph: Josh Edelson/AFP/Getty Images
Officials at the State Water Project announced earlier this year that it would only be able to provide 5% of requested water supplies to its contractors. The federal project, meanwhile, announced it wouldn’t be providing any water to the state’s agricultural belt, and that cities would be allocated only 25% of their historical water use.
The low water allocations will force farmers to either fallow their fields, or rely more on diminishing groundwater reserves, said Heather Cooley, research director at the non-profit Pacific Institute. The implications will trickle down to rural residents across California, many of whom have seen household wells tap out in recent years, she said.
Officials are also concerned that the reservoirs will be too shallow and hot for aquatic life this year. In an effort to protect endangered winter-run Chinook salmon, the bureau of reclamation and the department of water resources are seeking to install temporary chilling units at Shasta Dam to cool the water flowing into a national fish hatchery.
State and federal agencies will take “a conservative approach to water management” amid the drought, said Karla Nemeth, department of water resources director. “We need to be prepared for a hotter, drier future brought on by our changing climate.”
The current megadrought – which researchers found was the most severe in 1,200 years – is a sign that “we’re already seeing the effects of climate change in California”. Cooley said. “And we know that those effects are only going to get worse.”
Lake Oroville’s emergency spillway flooded over in 2017. This year, it’s at perilously low levels. Photograph: Josh FW Cook/AP
Demand for water is also likely to go up as California and much of the west faces more extreme heatwaves and hotter summers. Farmers and residential homeowners will require more water to keep fields and gardens green, she notes.
With global heating, California’s dry seasons are likely to be drier, and its wet seasons might be wetter, said Allison Michaelis, an assistant professor in the department of earth, atmosphere, and environment at Northern Illinois University.
In a study published this year in the journal Earth’s Future, Michaelis and her colleagues found that climate crisis amped up the amount of rain and snowfall that flowed into Oroville in 2017, ahead of the deluge that year. And research suggests that the same force could drive more extreme droughts in coming decades.
“It is challenging to attribute any one, specific event to climate change,” said Michaelis, who led the study. “But given what I and my co-authors found in our Earth’s Future paper, and what other researchers are finding, we can expect California’s hydroclimate to be more volatile in the future.”
Off-grid living beckons more than just hardy pioneer types. Here’s why it’s taking off.
Katherine Roth – June 12, 2022
The Solterre Concept House in Nova Scotia, an off-grid home featured in the book “Downsize, Living Large In a Small House” by Sheri Koones.
Living off-grid conjures images of survivalists in remote places and a rustic, “Little House on the Prairie” lifestyle with chores from morning to night.
Yet only a tiny fraction of people living off-grid do it like that, and fewer still live more than an hour from any town.
“Living off-grid doesn’t mean you don’t buy your groceries at a store or take your waste to the local dump,” says Gary Collins, who has lived off-grid, or mostly off-grid, for a decade. “It just means you are not connected to utility grids.”
He has published books on the subject, and leads online classes.
Although precise numbers of off-grid households are hard to come by, Collins estimates that only 1% of those living off-grid are in truly remote areas. Overall, the off-grid movement remains small. But it got a boost after the COVID-19 pandemic hit: City dwellers began to explore different ways of living.
Off-grid living unique to each person
More-frequent power outages, utility grids’ struggles and price hikes to handle the severe weather events brought on by climate change have added to interest.
The view from an off-grid guest house in Hollister Ranch, Calif., one of the last remaining undeveloped coastal areas in California, located on a wildlife preserve. The Anacapa Architecture firm, in Santa Barbara, California, and Portland, Oregon, has designed several upscale off-grid homes in recent years, and has several more off-grid projects in the works.
There are also those who remain connected to the grid but try to power their homes independent of it. Author Sheri Koones, whose books about sustainable houses include “Prefabulous and Almost Off the Grid,” cites the rise in “net metering,” when your property’s renewable energy source – usually solar – is producing more energy than you use, and your local utility pays you for the excess.
Today, off-grid living encompasses everything from “dry camping” in RVs (with no electrical or water hookups) to swank Santa Barbara estates, from modest dwellings tucked just outside of towns to – yes – remote rustic cabins.
Mount Jefferson looms over off-grid homes at the Three Rivers Recreational Area in Lake Billy Chinook, Ore., on April 26, 2007. Everyone in this community lives “off the grid”, part of a growing number of homeowners now drawing all their power from solar, wind, propane and other sources.
“Everyone does it differently and everyone does it their own way, because it’s their own adventure,” Collins says.
Elegant designs for a modern feel
The Anacapa Architecture firm, in Santa Barbara, California, and Portland, Oregon, has built several upscale off-grid homes in recent years, and has several more off-grid projects in the works.
“There’s definitely an increase in traction for this kind of lifestyle, especially in the last two years,” says Jon Bang, marketing and PR coordinator for Anacapa Architecture. “There’s a desire to get more in tune with nature.”
The lifestyle that Anacapa homes aim for is one of modernist elegance, not roughing it. Bang says new technologies can ensure comfortable self-sufficiency.
Another image of an off-grid guest house in Hollister Ranch, Calif., designed by The Anacapa Architecture firm. A high level of sensitivity to environmental impacts was exercised throughout all phases of design and construction, the firm says.
Such homes also are carefully designed to take advantage of the site’s landscape features with an eye to sustainability. For example, one of the firm’s homes is built into a hillside and has a green roof.
For those without the means to hire architects, there are numerous recent books, blogs, YouTube videos and more dedicated to the subject.
“A lot of people are interested in it now,” Collins says. “They contact me after watching something on TV or on YouTube and I tell them, `If you learned everything you know on YouTube, you are never going to survive.'”
He makes regular grocery runs, but also grows some of his own food and hunts wild game. He has his own septic system and well. While his previous home was entirely off-grid, with solar panels and a wind turbine for power, his current home is hooked up to an electrical grid, mainly, he says, because the bills are too low to warrant the cost of solar panels.
The off-grid guest house in Hollister Ranch, Calif., designed by the Anacapa Architecture firm, has nearly 360-degree views of the Pacific Ocean.
What health and safety considerations factor into the off-grid lifestyle?
If you want to be totally self-sufficient, he says, it takes a lot of time and physical effort. You won’t have time to hold down a job. If you’re living in a remote location, you need to consider access to medical care, and whether you are mentally prepared for that much isolation.
“Your wood won’t cut itself. You’ll have to haul water,” he says, warning, “People die off-grid all the time, because of things like chain saw accidents. You have to be very careful and think everything through. No EMS will get to you in time.”
And depending on how it’s done, he says, off-grid living is not necessarily environmentally sustainable – not if you’re driving a fuel-guzzling truck and relying on a gas-powered generator, for example.
Still, improved alternative energy sources and construction techniques are making off-grid living more thinkable for more people, including those who don’t want to haul buckets of water from a well or live by candlelight.
Reynolds designed off-the-grid homes called Earthships, according to Earthship Visitor Center, using sustainable building practices, including the usage of discarded steel and tin cans for the foundation of homes.
Architect and experimental house builder Michael Reynolds who used a variety of recycled materials to complete his first experimental home near Taos in 1974. Owned by lawyer Steve Natelson, shown in the picture, the home had a lawn on the roof, a common feature of sustainable design today, but an unusual concept for homes at the time. This experimental lawn required daily attention because of the dry environment.Inspired by the problem of trash and the lack of affordable housing, Reynolds created the “can brick” out of discarded steel and tin cans.Architect and experimental house builder Michael Reynolds who lives near Taos, New Mexico, used tires, empty steel beer and soft drink cans as some of the materials used to build the structure, with a goal of building homes 20% cheaper than conventional methods at the time.Interior view of the all aluminum beer and soft drink can experimental house near Taos, New Mexico.This photo from June 1974 shows a well housing that architect and experimental house builder Michael Reynolds built from old tires that have been covered with plaster.
Iterations of these homes evolved over the next decade to incorporate passive solar and natural ventilation.
Reynolds’ legacy continues to be a presence in the region today through a fully off-the-grid community, using exclusively solar and wind power, northwest of Taos. The community sits on over 600 acres and includes more than 300 acres of shared land.
Biden just declared heat pumps and solar panels essential to national defense – here’s why and the challenges ahead
Daniel Cohan, Associate Professor of Civil and Environmental Engineering, Rice University – June 10, 2022
President Joe Biden authorized use of the Defense Production Act to ramp up production of several climate-friendly technologies. Werner Slocum/NREL
Solar panels, heat pumps and hydrogen are all building blocks of a clean energy economy. But are they truly “essential to the national defense”?
President Joe Biden proclaimed that they are in early June when he authorized using the Defense Production Act to ramp up their production in the U.S., along with insulation and power grid components.
As an environmental engineering professor, I agree that these technologies are essential to mitigating our risks from climate change and overreliance on fossil fuels. However, efforts to expand production capabilities must be accompanied by policies to stimulate demand if Biden hopes to accelerate the transition from fossil fuels to clean energy.
Energy and the Defense Production Act
The United States enacted the Defense Production Act of 1950 at the start of the Korean War to secure materials deemed essential to national defense. Presidents soon recognized that essential materials extend far beyond weapons and ammunition. They have invoked the act to secure domestic supplies of everything from communications equipment to medical resources and baby formula.
For energy, past presidents used the act to expand fossil fuel supplies, not transition away from them. Lyndon Johnson used it to refurbish oil tankers during the 1967 Arab oil embargo, and Richard Nixon to secure materials for the Trans-Alaska oil pipeline in 1974. Even when Jimmy Carter used the act in 1980 to seek substitutes for oil, synthetic fuels made from coal and natural gas were a leading focus.
Today, the focus is on transitioning away from all fossil fuels, a move considered essential for confronting two key threats – climate change and volatile energy markets.
Utility-scale solar is now cheaper than fossil fuels. This installation is at Nellis Air Force Base in Nevada. Ethan Miller/Getty Images
The Department of Defense has identified numerous national security risks arising from climate change. Those include threats to the water supply, food production and infrastructure, which may trigger migration and competition for scarce resources. Fossil fuels are the dominant source of greenhouse gas emissions that are driving global warming.
Russia’s invasion of Ukraine highlights additional risks of relying on fossil fuels. Russia and other adversaries are among the leading producers of these fuels. Overreliance on fossil fuels leaves the United States and its allies vulnerable to threats and to price shocks in volatile markets.
Even as the world’s top producer of oil and natural gas, the United States has been rocked by price spikes as our allies shun Russian fuels.
Targeting 4 pillars of clean energy
Transitioning from fossil fuels to cleaner energy can mitigate these risks.
As I explain in my book, “Confronting Climate Gridlock,” building a clean energy economy requires four mutually reinforcing pillars – efficiency, clean electricity, electrification and clean fuels.
Efficiency shrinks energy demand and costs along with the burdens on the other pillars. Clean electricity eliminates greenhouse gas emissions from power plants and enables the electrification of vehicles, heating and industry. Meanwhile, clean fuels will be needed for airplanes, ships and industrial processes that can’t easily be electrified.
The technologies targeted by Biden’s actions are well aligned with these pillars.
Insulation is crucial to energy efficiency. Solar panels provide one of the cheapest and cleanest options for electricity. Power grid components are needed to integrate more wind and solar into the energy mix.
Heat pumps, which can both heat and cool a home, are far more efficient than traditional furnaces and replace natural gas or heating oil with electricity. Electrolyzers produce hydrogen for use as a fuel or a feedstock for chemicals.
Generating demand is essential
Production is only one step. For this effort to succeed, the U.S. must also ramp up demand.
Stimulating demand spurs learning by doing, which drives down costs, spurring greater demand. A virtuous cycle of rising adoption of technologies and falling costs can arise, as it has for wind and solar power, batteries and other technologies.
The technologies targeted by Biden differ in their readiness for this virtuous cycle to work.
Insulation is already cheap and abundantly produced domestically. What’s needed in this case are policies like building codes and incentives that can stimulate demand by encouraging more use of insulation to help make homes and buildings more energy efficient, not more capacity for production.
Electrolyzers face a tougher road. They’re expensive, and using them to make hydrogen from electricity and water for now costs far more than making hydrogen from natural gas – a process that produces greenhouse gas emissions. The Department of Energy aims to slash electrolyzer costs by 80% within a decade. Until it succeeds, there will be little demand for the electrolyzers that Biden hopes to see produced.
Why heat pumps are most likely to benefit
That leaves heat pumps as the technology most likely to benefit from Biden’s declaration.
Heat pumps can slash energy use, but they also cost more upfront and are unfamiliar to many contractors and consumers while technologies remain in flux.
Pairing use of the Defense Production Act with customer incentives, increased government purchasing and funding for research and development can create a virtuous cycle of rising demand, improving technologies and falling costs.
Heat pumps, which can both heat and cool, are far more efficient than traditional furnaces and air conditioning. Phyxter.ai/Flickr, CC BY
Clean energy is indeed essential to mitigating the risks posed by climate change and volatile markets. Invoking the Defense Production Act can bolster supply, but the government will also have to stimulate demand and fund targeted research to spur the virtuous cycles needed to accelerate the energy transition.
This article is republished from The Conversation, a nonprofit news site dedicated to sharing ideas from academic experts. It was written by: Daniel Cohan, Rice University.
Daniel Cohan serves on the Board of Scientific Counselors for the U.S. Environmental Protection Agency. He has received research funding from the Energy Foundation, the Carbon Hub, and various federal agencies.
Climate-driven flooding poses well water contamination risks
Michael Phillis and John Flesher – June 8, 2022
Homes are surrounded by floodwaters from Tropical Storm Harvey in Spring, Texas, Tuesday, Aug. 29, 2017. Experts say more intense storms driven by climate change are boosting contamination risks for privately-owned drinking water wells. (AP Photo/David J. Phillip, File)This photo provided by Stefanie Johnson shows Johnson’s private well in Blandinsville, Ill. Her well was contaminated during major flooding in 2013. Johnson’s family was without drinking water for nearly two months. She says contaminated wastewater likely drained in through the top, causing her well to test positive for E. coli. (Stefanie Johnson via AP)Neil and Bea Jobe pose in their home March 8, 2022, in Primm Springs, Tenn., which sits near Lick Creek. Several times a year, when there is heavy rain and a nearby creek floods, their well water turns “dingy,” Bea Jobe said. While estimates vary, roughly 53 million U.S. residents, about 17% of the population, rely on private wells, according to a study done in part by Environmental Protection Agency researchers. (AP Photo/Mark Humphrey) ASSOCIATED PRESSAn oil sheen drifts between a sunken shrimp boat and pieces of a destroyed home along Bayou Pointe au Chien in the aftermath of Hurricane Ida in Pointe-aux-Chenes, La., on Sept. 14, 2021. Experts say more intense storms driven by climate change are boosting contamination risks for privately-owned drinking water wells. (AP Photo/Gerald Herbert, File)n this photo taken in September 2017, Sandy Wynn-Stelt, of Belmont, Mich., stands in a wooded area near her home where industrial wastes containing PFAS chemicals were dumped for many years. High levels of the toxic compounds later were detected in drinking water from her well. While estimates vary, studies say roughly 53 million U.S. residents rely on private wells. While many provide safe water, experts say some are vulnerable to contamination from bacteria or other impurities from floodwaters or from groundwater tainted with PFAS or other pollutants. (Nic Antaya/The Grand Rapids Press via AP)
ST. LOUIS (AP) — After a record-setting Midwestern rainstorm that damaged thousands of homes and businesses, Stefanie Johnson’s farmhouse in Blandinsville, Illinois, didn’t have safe drinking water for nearly two months.
Flood water poured into her well, turning the water a muddy brown and forcing Johnson, her husband and their two young children to use store-bought supplies. Even after sediment cleared, testing found bacteria — including E. coli, which can cause diarrhea. The family boiled water for drinking and cooking. The YMCA was a refuge for showers.
“I was pretty strict with the kids,” said Johnson, who works with a private well protection program at the local health department. “I’d pour bottled water on their toothbrushes.”
Though estimates vary, roughly 53 million U.S. residents — about 17% of the population — rely on private wells, according to a study conducted in part by Environmental Protection Agency researchers. Most live in rural areas. But others are in subdivisions near fast-growing metro regions or otherwise beyond the reach of public water pipes.
While many private wells provide safe water, the absence of regulation and treatment afforded by larger municipal systems may expose some users to health risks, from bacteria and viruses to chemicals and lead, studies have found.
Risks are elevated after flooding or heavy rainfall, when animal and human feces, dirt, nutrients such as nitrogen and other contaminants can seep into wells. And experts say the threat is growing as the warming climate fuels more intense rainstorms and stronger and wetter hurricanes.
“Areas that hadn’t been impacted are now. New areas are getting flooded,” said Kelsey Pieper, a Northeastern University professor of environmental engineering. “We know the environment is shifting and we’re playing catch-up, trying to increase awareness.”
Pieper is among scientists conducting well testing and education programs in storm-prone areas. After Hurricane Harvey caused widespread flooding along the Texas coast in 2017, sampling of more than 8,800 wells in 44 counties found average E. coli levels nearly three times higher than normal, she said.
Sampling of 108 wells in Mississippi following Hurricane Ida in 2021 produced a similar bump in E. coli readings. Other studies turned up higher levels in North Carolina after Hurricane Florence in 2018.
The following year, above-average snowfall and a March storm unleashed flooding in Nebraska. Levees and dams were breached. Fremont, a city of more than 25,000, turned into an island when the nearby Platte and Elkhorn rivers overflowed.
The municipal system continued to supply drinking water but some nearby private wells were damaged or contaminated. Julie Hindmarsh’s farm was flooded for three days, and it took months to make the well water drinkable again. At times, the cleanup crew wore protective suits.
“They didn’t know what was in that floodwater,” she said.
CONTAMINATION RISK
Groundwater is often a cleaner source than surface supplies because soil can provide a protective buffer, said Heather Murphy, an epidemiologist at the University of Guelph in Canada. But she said that can give well owners a false sense of security, leading them to forgo testing, maintenance and treatment.
“There’s a big misconception that it’s underground, therefore it’s safe,” said Murphy, who estimates 1.3 million cases of acute gastrointestinal illness in the U.S. are caused annually by drinking untreated water from private wells.
Old, poorly maintained wells are especially vulnerable to floodwaters entering through openings at the top. “It just runs right in and it’s full of bacteria,” said Steven Wilson, a well expert at the University of Illinois.
It doesn’t always take a flood or hurricane to pollute wells. Industrial contamination can reach them by seeping into groundwater.
Around 1,000 residential wells in Michigan’s Kent County were tainted for decades with toxic per- and polyfluoroalkyl substances, or PFAS, in landfill sludge from footwear company Wolverine World Wide. The pollution, discovered in 2017, spurred lawsuits and a $69.5 million settlement with the state that extended city water lines to affected houses.
“We thought we were getting this pristine, straight-from-nature water and it would be much better for us,” said Sandy Wynn-Stelt, who has lived across from one of the dump sites since the early 1990s.
She said tests detected high levels of PFAS chemicals in her water and blood, leaving her fearful to drink or even brush her teeth with well water. In a suit later settled, she blamed the contamination for her husband’s 2016 death from liver cancer. She was diagnosed with thyroid cancer four years later.
LITTLE REGULATION FOR WELL OWNERS
While many well owners don’t have the option of hooking up to a public water system, others are happy with well water. They might favor the taste or want to avoid monthly bills and government regulation.
“What I hear from people is freedom,” said Jesse Campbell, private well coordinator for the Midwest Assistance Program Inc., which addresses rural water needs.
Private well owners are responsible for them. While public water systems must meet federal safety standards, those rules don’t apply to wells that have fewer than 15 connections or serve fewer than 25 people.
State and local standards usually involve only construction and design, although some states set tougher rules.
New Jersey requires water quality testing before sales of property with private wells. Rhode Island requires testing when new wells are built and when property with a well is sold.
But many states rely on public outreach and voluntary action to protect private well users.
“There’s an overall lack of education,” Campbell said. He meets with well owners from Montana to Missouri, providing free inspections and advice.
A lot of harm can be prevented if owners make sure the well’s top keeps out debris and that the pump is turned off before a storm to keep out floodwaters. Experts recommend testing after a flood and decontaminating wells with chlorine if a problem is found.
“People aren’t regularly testing,” said Riley Mulhern, an environmental engineer at the research group RTI International.
Indiana’s health department offers testing for bacteria, lead, copper, fluoride and other contaminants. Some land-grant universities and private labs provide similar services.
While many owners know how to maintain their wells, others ignore problems even if the water isn’t sanitary. Water that tastes fine can still be contaminated.
“I wish I had a nickel for everyone who’s walked into a workshop and said, ‘I’ve been drinking this water forever and it’s fine,’” said Jason Barrett, who directs a Mississippi State University program that educates well owners.
It provides free testing. But where such assistance isn’t available, costs can run to a few hundred dollars, according to experts. Some owners avoid testing because they are concerned it will reveal an expensive problem.
Johnson, the Illinois resident whose well was fouled by the 2013 downpour that killed four people and caused $465 million in flood damage, paid about $3,500 for repairs and upgrades.
“Luckily, none of us became ill,” she said.
Even ordinary rainstorms can carry diseases into groundwater, said Mark Borchardt, a microbiologist formerly with the U.S. Department of Agriculture.
“A lot of times people say, ‘Well, no one got sick,’” Borchardt said. “It’s hard to see when people get sick unless it is a huge outbreak.”
Bea and Neil Jobe live in Primm Springs, Tennessee, an hour’s drive from Nashville. Several times a year, when there is heavy rain and a nearby creek floods, their well water turns “dingy,” Bea Jobe said.
The discoloration disappears after a few days but Jobe takes precautions such as keeping bottled water available.
Home affordability has ‘collapsed’ in 2022. What to expect next, according to B of A
Is a housing crash brewing? Not likely, says B of A
Joy Wiltermuth – June 7, 2022
U.S. new home sales plunged 16.6% in April, even as prices continued to climb, according to government data released on May 24. AFP/GETTY IMAGES
B of A Global sees annual home-price growth as near a peak, not home prices overall. Also, low affordability likely hurts demand, not supply.
The double whammy of surging mortgage rates and skyrocketing home prices has led to “collapsed” housing affordability in America, according to Chris Flanagan’s team at B of A Global Research.
The situation has gotten so bad that it now compares to the “historically low affordability readings” in the fourth quarter of 1987 and the first quarter of 2005, according to the B of A team.
Existing home sales tumbled 33% in the wake of the 1987 crash and 45% in the aftermath of the subprime mortgage debacle. “In this cycle, we think a 35% peak-to-trough existing-home-sales decline is plausible,” Flanagan’s team wrote, in a weekly client note.
The cost of a 30-year fixed mortgage nearly doubled to about 5.25% in May from 2.75% last winter. The move higher came as the Federal Reserve began fleshing out plans to raise interest rates and trim its nearly $9 trillion balance sheet in a bid to tackle inflation that recently hit a near 40-year high.
While home prices have continued to climb this year, household wealth tied up in stocks and bonds has suffered, with the S&P 500 index SPX, +0.95% off 14% from its Jan. 3 closing high through Monday and the Nasdaq Composite Index COMP, +0.94% nearly 24% below its peak, according to FactSet data.
However, even in a somewhat “draconian” scenario, where the demand “side for housing is meaningfully altered by reduced affordability, the supply side remains exceptionally supportive” for home price appreciation, Flanagan’s team wrote.
Why? Blame the subprime mortgage mess and decades of underbuilding. Those catalysts led to record low supply of existing homes (see chart), which will take time to “normalize.
Housing crunch likely persists, even if demand dwindles. B OF A GLOBAL
Home supply was tight before the pandemic made it worse, as many families looked for bigger houses outside of big cities to adapt to remote work. That remains a key factor in B of A’s forecast for home prices to climb 15% for 2022 and 5% for 2023.
“Shelter is still scarce and residential real estate is still a good inflation hedge: To the extent there is any distress in housing, and forced sellers emerge, we think owner-occupied or non-owner-occupied buyers will be there to at least partially absorb the sales,” they said.
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