8 Surprising Reasons Why Now Might Be the Worst Time in History to Buy a Home
As a member of the unfortunate no-man’s land between Generation X and the Millennials, I feel I can relate better to the younger cohort when it comes to housing decisions. Not only do I struggle to stay marginally employed and constantly stress out about how much money I won’t be able to save for retirement, I've also fretted endlessly over the seemingly unresolveable rent vs. buy debate.
I’ve come to disagree with the long-held traditional view that housing is a great financial investment. And as Freddie Mac and Fannie Mae are seemingly gearing us up for foreclosure nightmare 2.0 with their recently loosened lending standards, I've become even more leery of jumping into a home purchase.
As I was tossing the pros and cons of ownership around the other day, another factor regarding this decision suddenly dawned on me. The technological and green innovations currently being drawn up in prototype and developed all over the world have the potential to drive the housing market in an even more negative direction than it is already forseeably headed. As green building standards become normalized and desirable to home buyers, older (non-green) homes are likely to depreciate significantly.
Innovation increases exponentially and what is happening with housing technology right now is exhilarating. As Scott Stern, an MIT economist, noted when discussing the advancements in robotics development, “technological advances are moving at a faster speed, with unpredictable results."
That is truer than ever for the housing market. Thanks to the volatility in the economy and real estate market, as well as the emerging green trends exploding onto the scene, this may be the best time in the world to wait to buy. Here are eight reasons why it's worth holding off.
1. 3-D printed homes. While this is an idea that is still in prototype, the potential of this technology is staggering to consider. Not only could it significantly reduce building costs and construction time, it could also create design opportunities that have never before been possible.
The 3-D printing process for homes is emerging in a couple of different ways. One idea on the drawing board right now is to use a huge 3-D printer that is brought in by semi-trucks and set up on the building site. Cement trucks would then be used to load the printer with building materials. A second possibility currently being researched at MIT would involve much smaller printers working together as a 3-D printing team to print the building in concert (which frankly sounds much more practical).
2. CNC printed homes. Although this process is a little less futuristic than 3-D printing, the possibilities are no less exciting. A CNC (Computer Numerical Control) building system works by transferring information from a G-code (a formatted set of coded instructions) to a CNC machine, which produces industrial components without direct human assistance.
The CNC then uses that information to cut each plywood panel with absolute precision. The panels are loaded one at a time into the machine until all of the necessary cutting has been completed. These perfectly cut plywood panels and pieces are then joined together to create the frame of the home. This design opens up the potential for more affordable customizing options, an expedited building process and reduced waste. As Mark Fleming, the founder of 3DPrinter.net, pointed out, CNC printing also allows the building process to remain as environmentally low-impact as possible.
“Although the CNC process is subtractive, the computer-developed pieces were designed to waste as little wood as possible. And there is no concrete, and the structural steel is minimal."
3. Wireless electricity (WiTricity). Wireless electricity essentially functions (for the user) the way a wireless Internet system does. It also promises to unburden architects and interior designers from their previous electrical grid constraints. And of course, wireless electricity could also make our lives much more convenient. Imagine never having to deal with a dead cell phone again!
After interviewing Katie Hall, the chief technology officer of WiTricity, journalists Nick Glass and Matthew Ponsford speculated about some of the ways wireless electricity could radically alter our day-to-day lives.
“If all goes to WiTricity's plans, smartphones will charge in your pocket as you wander around, televisions will flicker with no wires attached, and electric cars will refuel while sitting on the driveway."
However, wireless electricity (like many other emerging technologies) is a bit of a double-edged sword. On one hand, it is exciting to consider the ease of living in a home devoid of electric wiring. On the other hand, we can see potentially troubling surveillance consequences and the prospect of yet another career field in danger of being marginalized.
4. Graphene. Touted to be 300 times stronger than steel and only one atom thick, this mammoth-sized discovery has the potential to literally change everything we build.
Graphene is 2-dimensional, transparent, and an unparalleled conductor. And it is just the tip of the iceberg for what is being discovered and tested in the 2-D construction realm. As Tomas Palacios of the MIT graphene research department stated in a 2013 CNN article:
"Now there are more than 10 materials that are all two-dimensional with complimentary properties that could be integrated with graphene to provide extra functionality. Boron nitride for example is also one atom thick and instead of being a conductor it is an insulator of heat, the best insulator we know. If you go to three atoms thick we have another material called molybdenum disulfide which is a semi-conductor, like silicon, but lighter and stronger. These materials can then be combined in order to fabricate completely new material structures that don't exist in nature."
The research and development of graphene is being pursued by nearly every industry on the market, including technology companies and the aviation industry. But there will certainly be consequences for the housing industry when homes can be built only a few atoms thick with much stronger and more durable materials than those currently available on the market.
5. Net-zero energy homes. These homes are rapidly making their way onto the prefab market and being fine-tuned for mass consumer availability. Net-zero energy homes are capable of producing as much energy as they use, making the transition to off-the-grid living more plausible for mainstream consumers than ever before.
While a number of net-zero energy homes are actually still plugged into the grid and working on a deficit/surplus-like exchange with energy companies, the technology is still being improved upon and will most likely lead to an increase in energy-plus buildings. Energy-plus buildings can actually create more energy than they use and could conceivably allow homeowners to sell their extra electricity back to the utility company for additional income throughout the year.
6. The carbon-neutral/carbon-negative trend. From carbon-negative cement and timber-framing to full-blown carbon-negative homes, this is definitely a trend to keep an eye on. Another offshoot, the carbon-neutral home, simply does no added environmental harm.
“A building that is carbon neutral uses no fossil fuels in its operation, no direct greenhouse gases, and as a result, does not contribute to global warming. The energy it uses may be produced on site or may be drawn from a utility grid but it must be 'clean,' produced by wind turbines, photovoltaics, or other renewable energy systems."
Carbon negative homes, which are both fossil fuel-free and create a surplus of energy, take things a step further. Homes can be made more carbon neutral/negative by using solar power and solar hot water heating systems, harvesting rainwater or harnessing wind energy.
7. The passive house trend. Passive homes combine solar collection systems, natural ventilation flows and superinsulation to create residences that more efficiently collect and retain a desirable temperature.
What's even more exciting about some of the newly designed modular passive homes is their price tag. A new passive house pop-up home is on the verge of hitting the market for a mere $41,000. That sure makes buying an old house and trying to bring it up to green standards seem financially foolish.
8. Solar sockets and solar windows. Solar sockets are still in development and may be a long way from hitting the market, but they will make energy very cheap if they are ever succesfully launched. A solar socket is basically a small, dual-sided round disk that attaches to a window via suction cups. The side that attaches to the window is fitted with a small solar panel that charges during the day, while the other side of the disk is an electric outlet you can plug anything directly into.
Solar windows, however, are just starting to emerge on the market in a limited capacity. The biggest buzz surrounding solar windows is their potential for turning skyscrapers into huge solar energy collection systems.