HAYWARD -- The latest plan to make the city greener could come at a cost of thousands of dollars for Hayward homeowners and those looking to buy a house in the city, something real estate agents fear will be "the final nail in the coffin" of a floundering market.
The Residential Energy Conservation Ordinance would require homeowners to make their domiciles more energy-efficient. Those fixes include some of the cheap and easy variety -- adding weatherstripping, insulating water heaters and pipes -- as well as more intensive projects, such as having air leaks professionally analyzed and sealed, and adding attic and floor insulation.
City staff members are working up a draft ordinance and considering different triggers that would require compliance. One would require the work be done within two years of the property being sold. Another trigger would be when the owner does extensive remodeling. A third would set a compliance deadline for homes built before 1978, when statewide efficiency standards for new construction were adopted.
City planner Erik Pearson said the average cost would be less than $3,000. Spending caps are being considered: 1 percent of the sale price or assessed value, or 10 percent of the cost of a remodel. Pearson recommended exemptions for low-income or disabled residents.
Pearson added that an energy audit on newer homes being sold "may show that the home is already relatively efficient and no improvements would
Real estate agents were many of the two dozen people who turned up at the city's Sustainability Committee meeting on the subject this month. They said the ordinance would be a huge mistake, some calling it "suicidal" for home sales in Hayward.
"They don't realize how distressed Hayward is," said Judy Rose, who has sold real estate for 34 years. "It's the most difficult city to sell in right now."
According to real estate analyst David Stark of the Bay East Association of Realtors, 60 percent of transactions in Hayward are distressed -- short sales or foreclosures.
"Homeowners don't have any money to do the retrofitting, and buyers are strapped just trying to get into a house," Rose said. "People are struggling, homeowners are upside down. "... This would be the final nail in the coffin for the Hayward market."
Stark said that in addition to being a complicating factor and a deterrent to people buying in Hayward, there hasn't been enough analysis to make the case that the upgrades would be beneficial in the city's mild climate.
During an earlier meeting, a city consultant said energy use for heating and cooling is far less significant in Hayward than in areas with greater fluctuations in temperature, meaning the retrofits would take longer to pay for themselves.
Without taking incentives into account, it would take 30 to 35 years to recoup the initial investment, a staff report states.
The incentives are crucial to the program, Pearson said, and money offered by the city and PG&E go a long way toward making the improvements. PG&E offers $1,000 for people participating in a basic upgrade program, while the city would pay for $750 of ordinance-related measures. With those rebates, sealing and insulation work would cost between $1,690 and $2,266 on average, according to a staff report.
While Stark and Rose said the city would better serve residents with an education campaign to let them know about such incentives, resident Ernest Pacheco told officials he applauds the ordinance and urged its passage as soon as possible.
"There will never be a time when real estate brokers say, 'Let's put something out there that will hurt our business,' " he said. "You are going to (anger) people sometime or other."
Sustainability Committee member and Planning Commissioner Al Mendall said the concerns about the economy are valid.
"Maybe we can delay it until the housing market recovers," he said. "There may never be a perfect time, but maybe some sort of trigger, such as having it take effect when distressed sales fall below 20 percent for two straight quarters. It would be a good addition, it might delay (implementation), but it addresses the concern of timing."
Committee member and Councilman Bill Quirk said they need to be "politically realistic" about the ordinance.
"We have to do things that make it easy for people to comply," he said. "If everyone comes down to City Hall to speak against it, we're not going to do this."
San Francisco and Berkeley passed similar ordinances in the early 1980s.
The draft ordinance is slated to return to the Sustainability Committee on March 2, with a City Council work session on the item scheduled for May 31.
For details, go to www.hayward-ca.gov and click on the RECO link under "News and Announcements."