Two Toronto-area builders announced plans last month for subdivisions that will be among the first in Canada entirely built to new energy-saving standards.
Under the Energy Star program, which the federal government started as a pilot project this past January, homes must be built with at least 40 per cent more energy efficiency than required by Ontario Building Code legislation.
This can mean changes such as upgraded insulation, high-performance windows, sealed air ducts, and more efficient heating and air-conditioning systems.
The changes have frequently been available to buyers as an option, but last month marked the first time at least two builders - The Daniels Corp. and Mason Homes - listed them as standard. Other builders such as Oshawa-based Halminen Homes were expected to make announcements soon afterward.
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| Illustration courtesy of The Daniels Corp. |
| The Daniels Corp. is one of Ontario's first homebuilders to include the Energy Star program in homes it is building in subdivisions for first-time buyers. |
The Energy Star program got a big boost in August when the Canada Mortgage and Housing Corp. (CMHC) announced people buying an Energy Star-certified home would be eligible for a 10-per-cent rebate on their mortgage insurance and be able to amortize the principal over a 35-year period.
"This is a pilot project for Ontario homebuyers which may be rolled out to the rest of the country," says Lenard Hart, director of business development for EnerQuality, which manages the pilot Energy Star for New Homes program in Ontario. "We've met and passed all of the expectations for this already. It's going extremely well."
Hart says other Canadian provinces have similar programs already in place, such as Build Green in Alberta and British Columbia, and Power Smart in Manitoba.
All of the programs were modelled after a similar federal R2000 initiative. He adds Ontario's Energy Star program is under licence from the U.S. Environmental Protection Agency (EPA).
In the Greater Toronto Area's fast-paced housing market, builders have started to realize the program can offer a distinct marketing advantage. The push towards energy-efficient homes also comes at a time when consumers remember how high gasoline prices went this summer. Some analysts suggested the cost of fuel might cause home heating bills to go way up this coming winter.
"There was definitely a really strong relationship between the two," says Hart. "People have been thinking about energy conservation and it's definitely raised their consciousness to a whole new level."
Hart says he was at this year's International Home Show in Toronto last month, where an entire aisle was dedicated to environmentally green products. "I had lots of questions from people who wanted to know how they could save on their energy bills. With continued low interest rates, lots of people have been interested in buying homes. If those rates go up, everyone will still be interested in how they can keep their monthly costs like fuel down."
Bank of Canada governor David Dodge did indeed raise the key overnight lending rate late last month to three per cent. Canada's five major banks quickly followed suit by posting higher mortgage rates, raising the cost of borrowing money to buy a home.
Meanwhile, The Daniels Corp. has already started work on FirstHome, its 354 townhouse development, in the Mississauga community of Erin Mills. With prices starting at $129,900, homeowners who do take advantage of the 35-year mortgage will save an estimated $150 per month on their monthly carrying costs. And it will also mean significantly lower heating and air conditioning bills once the purchaser moves in, says Don Pugh, Daniels' vice-president of low-rise development.
"We have been committed to affordable housing and saving energy for quite some time," he explains. "This seemed to be the perfect way to combine both. The project was almost ready to roll out when we first heard of Energy Star."
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| Don Pugh |
Pugh says Hart was invited to speak to a group of Daniels' executives, including company president Mitchell Cohen. They instantly realized it would be good for entry-level buyers in their FirstHome project, who were already interested in saving as much money as possible.
"We looked at each other in that meeting and all agreed it was the right thing to do. This (Energy Star certification) seemed like such a great fit for what we were doing," says Pugh. "We've always believed in affordable housing and energy conservation."
Energy Star officials had already done presentations to other builders, but Daniels was the first company who looked at it for "affordable housing," Hart recalls.
"They were one of the first ones to really get it when it comes to the Energy Star program," says Hart. "Everyone else said 'Yeah, this would be good for our higher-end homes like gated communities,' but nobody realized it could be for affordable housing, too."
The FirstHome development will feature "stacked" townhouses, with one unit built right on top of the other. Garages will be built away from the actual home, says Pugh.
Mason Homes, based north of Toronto in Concord, has announced that from now on all of its homes will be built to the Energy Star standards. The company has projects already selling in Uxbridge and Barrie. It will start selling units this month in Lindsay and next year in Peterborough.
Hart says Mason Homes president Sean Mason has committed to including the Energy Star upgrades at no extra charge for the time being.
Toronto builders are under increasing pressure to be creative in designing their homes. Ontario Ministry of Housing studies show a projected four million people will move to the province over the next 30 years. Most of those people are expected to locate in the GTA.
Earlier this year, that pressure grew more intense as the province approved its greenbelt legislation, protecting the environment in a wide stretch of land around the GTA. That means as the population grows, builders can't use 1.8 million acres of land stretching from the Niagara Peninsula to just north of Oshawa.
Ontario's housing market also posted record numbers this year. Most of those gains were in the condominium sector, but the low-rise market was also up, forcing builders to find different ways to market their homes.
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| Lenard Hart |
"The market is very competitive, there's no doubt about it," says Pugh. "This is a chance for us to really make a difference, though. We're hoping to start a tradition where kids will grow up in Energy Star homes and then get older and look for energy efficient homes themselves. This is good for us and the environment."
Hart says as more builders start offering Energy Star-certified homes, officials may look at raising the standards in coming years.
"The idea is an Energy Star home is the best in the industry when it comes to energy efficiency. As more builders come on board, that could very well increase."
Web Watch: www.masonhomes.ca
www.energyefficiency.org (EnerQuality website)
(David Hatton can be reached at hatton@businessedge.ca)
