Financing the Energy Efficient Home – Saga Part 1

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appraisal_formWhere to begin?  We’ve been working on financing for almost 9 months.  I had hoped to be in a position to start construction early in 2013 and thought I had budgeted enough time and money to do this.

We’re not amateurs; we did a construction loan on our existing house and, without tooting my own horn that much – we’re pretty darn good credit risks if you believe all the score stuff.  😉  So what’s the deal?

A perfect storm of nonsense, that’s what.

  • Banks are exceedingly paranoid about lending their money at low rates.  Especially jumbo loans that might have to pass scrutiny and not get sold on the secondary market.
  • Large banks, despite being some of the most “creative” when it came to financing and building up the subprime mortgage market, are excessively difficult to work with.  And then have the nerve to talk to ME about how risk averse they are.  Seriously?  Does the word “robo-signing” mean anything to you?
  • Banks seem to do less and less “bank” stuff, and instead – prefer to make money playing with other peoples’ money.
  • Interest rates at historic lows means that banks have little interest in making 30 year mortgage commitments.
  • Credit unions rock – I love mine – but they stopped doing construction loans about the time I needed one….
  • Pair Modernist with Energy Efficient and the banks / appraisers don’t know what the heck to do with themselves.
  • And the new rules designed to prevent the fraud that occurred a few years ago have effectively crippled the ability for “normal” (and qualified!) folks to get a loan.

Early in the process we started with one bank and (mistakenly) abandoned them when we got a poor appraisal.  Instead of forging ahead and looking for options or other comps to work with this appraisal and get it to where we needed. we had another bank and went to them.

mortgage-appraiser

Me – dealing with banks.

In our defense, the 2nd bank was promoting themselves as having an interest in community lending, and specifically, putting together a Modernist home loan program because their research indicated that Modernist homes – well designed and well loved – simply didn’t go to foreclosure.  As I have mentioned previously, Triangle Modernist Houses is a force for Modernism in the area and were also trying to forge relationships with banks to help preserve our at risk homes in the area and have a modern-friendly bank that understood that while “simple” in design, usually a Modernist home is more costly than that of a home built for square footage.

After a process that I likened to a financial colonoscopy, we were approved.  However, when the commitment letter arrived, it contained terms that were so impossible, we simply could not go forward.  This was very disappointing in that we had spent so much time, and pretty much had had positive feedback all through the process.

Live and learn.  So – we’re back and bank number one – and we DID learn something from the last experience – we are understanding the appraisal process and what we can and can’t do, who is and isn’t qualified, and how we can position ourselves for success.

Next post will discuss financing the energy efficient part.  Another challenge.  Heaven forbid you do anything “different”…

 

The Thermal Envelope

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If you can’t tell – I’m the ‘She’ in the About Us page.  I am not the technical engineer.  I have a good solid understanding of mechanics and more technical things based on my career, experience and the fact that I can be a little bit of a gearhead with the cars.  However, I am also a sales / marketing person at heart and I am a firm believer in “Do not let Perfect be the enemy of Good”.  I am an 85% is FINE – get it done person.  So – I blog.  I write.  I am the extrovert.  I am the one usually spinning out of control and scurrying around.

I share this because you will see some posts from the ‘He’ here shortly and just in case you couldn’t tell – I wanted to let you know you’d see several authors.  Also – if you want more of the nitty gritty technical stuff – it’s coming.  Trust me.

At a higher level – I may be focused more on aesthetics than performance, but I do appreciate a high performance ANYTHING.  I also appreciate that our current house was overbuilt and outperforms all the other houses in the neighborhood.  We’ve already been familiar with geothermal heat pumps, alternative types of insulation, better sealed envelopes and windows with argon filled sealed spaces and low e coatings.

After we selected the wall system – it became apparent that we were onto something – one product – several functions.  It begged some thought and discussion about how to carry this “theme” to other areas.  Hubby had said early on as an “architect test” that he wanted a house with no 2×4’s and no sheetrock, and it appeared we could get that for the walls by using concrete sandwich panels.  Also, with steel, concrete and glass being our mantra, we had a lot of flexibility on materials.

Roofing traditionally is metal or membrane or shingles.  Since we had rejected the flat roof purely out of functional paranoia, a single sloped roof was in order.  However, I was 100% in love with the flat roof “look” and it fit so nicely into my mind’s eye of the mid century look I was trying to get.  Enter the insulated roof panel.  Initially developed for refrigerated buildings, we could easily now get R-50 in a LONG panel that was totally thermally isolated and that gave us the inner and outer surfaces, as well as some great insulation.  Several companies provide this type of panel, but we found a local installer and a fairly local manufacturer.  Metl-Span had just what we needed and Metal Roofing Corporation is an amazing partner and dove in helping us fully utilize the benefits of the product for both our roof, as well as the extensive shading structures we have to manage the summer sun.

red roof

The roof helps with LEED (insulation factor, airtight, no thermal paths, and solar reflectivity – not to mentions “local” material within a few hundred miles.) and provided the look and feel we were going for.  The inside of the roof will sit on our open bar joists (for a loft like look) and provide the finished ceiling.

Next – we’ll see how International Precast was able to help us connect the roof to the wall insulation as the cooler building (ha! pun!) continues.

We’re building a cooler.

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A cooler what, you ask?  No, a cooler.

The reason a cooler works so well at maintaining the temperature of the things inside it, is that it fully insulates the contents from the ambient temperature.  For the most part (except for the opening lid) there is no thermal path that connects and conducts outside temp to inside temp.  Therefore, your beers stay icy cold!

coolerWhile we might not want to be icy cold, certainly the thermal envelope of any building is the single most important part of the building process, and minimizing the thermal paths, from outside to inside is paramount (as is sealing it up, but more on that later).

Conventional construction – whether 2×4’s or 2×6’s or even 2×8’s have wooden thermal paths every 16 to 24 inches or so.  Therefore, you can stuff some high R value insulation in those spaces, but your still fighting those paths.  Folks have gotten around that but essentially building a house within a house and offsetting the studs, but that seemed, to us, to be a little complicated.  So – what will we use for a wall system?  What can minimize these thermal paths, and is durable and cost effective?  SIP panels?  These are a really good product to minimize the thermal paths, but still very conventional and you still have to put something on the inside of them for walls, and then something else for your exterior finish.

We’d heard about some concrete panels with insulation – essentially the Superior Walls method, but that still wasn’t the answer.  Finally – we found the concrete sandwich panel.  3 inches of concrete, 4 inches of insulation, and then 3 more inches of concrete.  What this did, was allowed the panels to provide our exterior finish (remember – we like the minimalist aesthetic), our insulation, and our interior wall – which we can paint, adorn, or leave in all its grey glory.

Interestingly, this “all in one” material started us down a path for a couple of themes, including one material providing finished inside / insulation / finished outside and also working to minimize the subcontractor on the project to try to contain costs.

So – we now have the walls for our cooler – and we’ll talk about how the insulation could be continuous around the house…..

What do we want?

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questionsSimple question, right?  But the answer isn’t the simple.  We knew we wanted an energy efficient home, but “how” energy efficient?  We knew we wanted a Modernist home, but how Modern?

We knew we wanted one level.  Having lived in our current home that is essentially 3 levels – and really only using one – it’s apparent that the other floors are somewhat wasted.  And – since we have dogs – old dogs and blind dogs – accessibility is important.  Having elderly dogs and vision impaired dogs help you learn about things like “aging in place” and accessible (or universal) design.

I am probably more into the aesthetics and the design process than my husband.  He’s definitely into the performance and the materials.  Not to say that he’s not quite particular about design, because he is – he just sees more beauty in a functional design and I might be swayed by anything ‘shiny’…

In working with tonic design, we knew they had recently done a LEED Silver home.  What’s cool about that is that it is the was the first Modernist LEED home in NC.  With basic tenets of modern architecture being lots of light / windows / volumes, it becomes an additional challenge to make these types of homes energy efficient.  It’s pretty easy to make a box with tiny windows LEED Gold or so, but not so easy when you want to use materials like glass, steel and concrete – historically pretty horrible insulators.

As we worked through the design process, we focused on the house and the shop and how we could build efficiently, and how we could make sure that the buildings related to each other correctly and to the site correctly.  The “shop” portion of the project is important to us, so it needed to be fully integrated into the plans.  It was not going to be an ‘outbuilding’ or anything that spoke a different language than the house.

The result is ShopHouse.  A study in glass, concrete and steel that also ends up being LEED Platinum.  Getting that to happen is going to require the right materials and the right team.

Is there a Match.com for Architects / Clients?

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words about projects

words about projects

Who is going to design this new house?  Then, who’s going to build it?  How will they view our project?  How involved can we be?  Can this person take our list of must haves and translate that into something REALLY COOL?

In the last post, I noted that we’d done several TMH tours and had started to get a good “feel” for the local architecture scene.  TMH is an amazing resource for all things Modern.  Between the tours, the website that has amazingly comprehensive listings for homes for sale and the local architects’ resumes (both past and present) – we started here.

Hubby and I sat in the couch and had our notepads and dueling laptops, and we went through the listing of Triangle architects one by one, writing our lists with ‘definites’, and ‘maybes’.  After we completed that exercise – we compared notes.  Anyone that made both our ‘definites’ made the short list.  Where we both had ‘maybes’, we discussed, and same thing when we had an architect that made only one ‘definite’ list.

Because this is a personal matchmaking decision, I won’t name names – but I do think its important to share what we did and why we ended up where we did.  We had 4 architects / firms that we wanted to engage and speak with in greater depth.  We had talked to several of them on site during a tour, but that’s not the time to discuss anything in any detail.

We spoke to 2 single architects that were not a design – build firm.  One fit with our energy efficiency objective, having worked on some very efficient homes with probably the most extreme area builder of ‘green’ (man, I hate that word) homes, and another fit our need for aging in place and truly understood our goal to make the house ‘dog friendly’.  Ultimately, we decided that it was imperative to us to have a design – build firm.  We’ve both refereed finger pointing sessions at work as to which team was at fault for some failure and we didn’t want to do that in our house.

That left us with two good design – build firms.  There was some initial concern that, while there was not a single tonic design home that we didn’t like, were they “too far out there” and too much an artist and not enough scientist (or engineer, or builder) to execute what we knew would be a very technical project.  We appreciated their design process that allowed a feasibility study to be done at a VERY reasonable cost and would likely help us understand if we could make this all work.  But, with the other firm, after viewing a more modern home of theirs, we thought perhaps they were “just right” – so we started there.

We went through an extensive schematic design process with Firm #1.  It was very enjoyable as we went through 4 different designs and spoke to each one of them about what appealed to us, and what did not.   One of the more bizarre items that we threw out there was that we wanted a house with “no sheetrock and no 2×4’s”.  While it sounds odd, it was really meant more to challenge the teams to think differently and not necessarily an edict.  Ultimately, we learned a LOT through the initial design process with the first team.  We learned that I wasn’t going to win the battle and get a flat roof, and that we really did want single floor living, and that we were going to be pushing the envelope on both design and energy efficiency.

Technically, we could have gone forward with the design we had – it worked, it was certainly aesthetically pleasing, and I am sure would have been a great, custom, liveable house.  But – it wasn’t as “boundary pushing” as we were looking for.  It was conventionally constructed and contained many of the dreaded sheets of sheetrock and tons of 2×4’s…  Because tonic design had the Feasibility Study option – we felt we owed it to ourselves to see if there was a better fit out there before making such a major commitment.

After a meeting or 2 with Vinny, Katherine and Maggie, it was apparent that this team not only would rise to the occasion – they would thoroughly enjoy the challenge and loved the idea of no sheetrock and no 2×4’s.  The design process was so tactile and creative (think building blocks, clear lucite chunks, clay, paper, scissors and tape) it allowed a level of engagement and involvement by us, the client, that it truly felt like “our” house already.  There was a sense of adventure when we started on the LEED Platinum route, and when we started asking about concrete sandwich panels, and all sorts of other nontraditional materials – it was met with a true sense of engagement and the collaborative effort we were looking for.  We knew this was the place and that the house would be exceptional.

Next up – performance, cost and form following function.  (or, as it’s sometimes known – the engineer vs the marketing chick….)

And so it begins….

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Why build?  Why now?  What to build?  Where to build?  Can’t we just buy something?  Are we nuts?  Will our marriage survive this?

All valid questions.  (And some with answers that remain to be seen….)  We’ve got some catching up to do here, since we pretty much have plans and are ‘this close’ to breaking ground.  So stay tuned for some daily posts – or perhaps a couple times a day to get current.

After 15 years in our current home – we decided that, although it’s a great house in a great neighborhood, it would be nice to:

  • have more space (acreage)
  • have true ‘one floor living’ to help with aging in place (we’re not old, but we’re not getting any younger – and besides – when you live with a couple of blind dogs, you find out pretty quickly how daunting stairs can be…)
  • be able to build a real cutting edge, energy efficient home, and
  • be able to build a true modernist home.

Our style has evolved and matured, and while this house is in no way traditional, it was as far as we could push the envelope at the time, and within the bounds of the neighborhood covenants.  We also know that, from staying current with trends and homeshows, it’s way easier to find modern fixtures and styles now, than it was when we built (1997).  It’s either the Mad Men effect, or the HGTV influence.  Either way – we’re thankful.  Also, the entire “green” initiative has grown by leaps and bounds.  When we built, getting a 14 SEER heat pump was “crazy” and our builder commented that he had seen units that large outside the Sears Tower….  Never mind the “low e – squared” windows, and recycled blue jean insulation batting.  Now – there is LEED, and PassivHaus, and Energy Star (oh my!) and a host of technological advances.

Dear Husband has stated that he’s not “green” to be “green”, he’s green because he’s cheap.  He’s not cheap, but he’s practical.  Energy costs have nowhere to go but up.  In the US, we’ve enjoyed artificially low energy costs for years – and you saw what happened when we had crazy price increases (and they never really came back down).  So – focusing on operating costs of a house is just smart business and hedges your expenses in the long run.  If you can lock into a 30 year mortgage, and focus on energy costs, maybe our retirement savings will last as long as we do…  ha ha….

So – after years of touring homes on the AIA Tours, and TMH (Triangle Modernist Houses) tours, and ALMOST pulling the trigger on 2 cool homes,

dp6 house_rear

(driving our neighbor / Realtor crazy) – we decided that if we’re going to do it – let’s do it once, do it right, and do it for us.

So next – we pick an architect.