Just Solutions, along with many of our partners, urges the Federal Housing Finance Agency (FHFA) to require that the home mortgages they back meet updated energy efficiency standards. As the FHFA oversees the government-sponsored enterprises (GSEs) Fannie Mae and Freddie Mac, such action would bring about 70% of mortgages for new homes in the U.S. into line with higher energy efficiency standards, preventing nearly 200 million metric tons in CO2 emissions and creating an estimated 590,000 jobs. Low-income and disadvantaged communities in particular stand to gain from the energy cost savings and health and safety benefits that come with improved energy efficiency.

Just Solutions has produced a trio of briefs examining this opportunity from several perspectives. This brief takes a state-specific approach, examining a proposal to take state action to similarly upgrade Michigan’s residential building energy codes as the state simultaneously embarks upon a campaign to address housing supply challenges. It considers the costs and benefits of adopting the updated energy codes, particularly for lower-income households, and refutes arguments from opponents that such action – either by the state or by the FHFA – would negatively affect prospective homeowners. It makes the case that, given the urgent need to increase housing supply in Michigan, now is the time to ensure that newly-built homes maximize the health, comfort, and safety of residents while minimizing home energy costs.

This trio of briefs will be followed by a webinar to be held in January 2025. With our partners, we are also submitting a letter to the Biden Administration urging that the FHFA take immediate action on this issue.