Tag Archives: real estate

Saving ventilation cost by using the wind

Most large modern buildings have active ventilation built in, meaning that electric fans drive the air through the building. The airflow direction is usually fixed at construction time. However, if the wind happens to blow from the opposite direction to the ventilation flow, then the fans require extra energy to counter the wind. On the other hand, if the wind agrees with the airflow in the building, then the fans may not need to be run at all. To save electricity, a building could have a wind direction sensor (a weather vane) on the roof connected to a switch that reverses the ventilation fans, so that the fans always pump air in approximately the same direction as the wind. If the wind is strong enough, a wind speed sensor (a small windmill or windsock) on the roof could stop the ventilation fans altogether.
The tradeoff for this adaptive ventilation system is the initial fixed construction cost and the ongoing maintenance of the weather vane, windsock and controller of the fans. All the extra components of the system (relative to the current unidirectional ventilation) are cheap and robust, so the both the fixed cost and the maintenance should be negligible.
Current ventilation systems have differently shaped air inlets and outlets in the rooms, which suggests that the system requires a particular airflow direction. In this case, adaptive ventilation may be much more expensive than the current ones, because the ventilation shafts and air vents need to be doubled. To avoid the need to build twice as many shafts and vents, have just the air inlets and outlets of the whole building switch roles with the wind direction. The rest of the system can remain unidirectional when the valves from the building’s inlet and outlet to the rest of the system switch appropriately. The air inside the building can then move in the opposite direction of the wind some of the time. In this case, the electricity saving is only realised if the building is sufficiently airtight, which is the case for modern highrises that have unopenable windows. If the air is allowed to move through the building independently of the ventilation and the wind is opposite the airflow in the system, then the fans have to overcome the air pressure difference like in the current systems. This wastes electricity.

When to open windows to cool or warm a building

My uninsulated apartment building went from too cold to too hot in about a week, which is normal in Canberra. People have started to open the windows in the stairwell in addition to their apartment windows. The timing of the opening seems a bit misguided – people open the windows in the morning. During daytime, the air outside is warmer than the air inside the stairwell, but during the night the outside air is colder. To state the obvious: to cool down the building, open the windows for the night and close them for the day. Currently the opposite seems to happen, although I counter this trend by closing the windows in the morning when I notice them open.
In general, if you want the building cooler and the outside air is colder than the inside, then open the windows, but if the outside is warmer, then close them. If you want the building warmer and the outside air is colder than the inside, then close the windows, but if the outside is warmer, then open them. This could easily be automated with temperature sensors outside and inside the building connected to a thermostat and small electric motors opening and closing the windows. Such a system would save some of the heating and cooling costs of the building.
There may be non-temperature reasons to open and close the windows, for example to let smell out of the stairwell or to keep insects from coming in. The second reason is not relevant for my building, because all windows have bugscreens and the exterior doors have a gap an inch wide under them, which the insects can easily use to get in.

Tenancy Ending Checklist

Before the final inspection:
Give or receive valid notice of ending tenancy in writing, resolve any dispute about this.
Confirm any arrangements for agent/landlord to access property in writing.
Schedule final inspection.
Disconnect all utilities connected in your name.
Calculate rent payable until end of tenancy and pay that amount.
Cancel direct debit if necessary.
Clean property as needed when compared to incoming condition report.
Arrange for carpet cleaning if necessary.
Remove any additions, alterations you have done to property.
Print 1) bond refund form, 2) move-in condition report (keep a copy), 3) filled or blank move-out condition report, 4) key receipt to take to final inspection. 5) Put the move-in photos and video on a laptop/other device or print them to take to final inspection.

On the day of final inspection or move-out day:
Take photos of meters (date stamped).
Take photos/videos of condition of property and do your own condition report.
Bring the required forms, photos and video to the final inspection. Attend final inspection.
Return keys and get a receipt or sign a photocopy.
Resolve any issues with condition of property.
Sign bond refund form and lodge with Office of Rental Bonds (you or the agent can do this).

Neighbourhood coordinating to keep houses small and prices high

If apartment buildings are built in a neighbourhood of detached houses, then the house prices fall, especially next to the new apartment buildings. There is less privacy in the garden if many windows overlook it, and there is more congestion and crime if more people live nearby. The neighbourhood’s common interest may be to block the development of large buildings in it. However, an individual homeowner finds it profitable to sell to a property developer who will replace the detached house with a large apartment building, because the cost of reduced house prices is borne by the neighbours, not by the seller.
One way that neighbourhoods try to prevent this tragedy of the commons is to require all homeowners to join an association and agree to be bound by the rule that the association can prohibit new buildings or expansions. Such rule-based solutions are usually vulnerable to legal loopholes and changes in government policy that invalidate the restrictions. Game theory offers a solution without requiring any external enforcement: if one homeowner extends her house or replaces it with a bigger building, or sells to someone who will, then the neighbours respond by building apartment buildings around the property of the first breaker of the social norm of non-expansion. Then the view from the first expanded building is only the walls of the others, which makes the expansion unprofitable and deters enlargement in the first place.
The punishment for the first extension has to be certain enough to deter it. In particular, the homeowners next to the violator of the norm must be incentivised to build even at a loss. This incentive can be provided by requiring the neighbours of the homeowners next to the violator to punish those who do not punish the violator. This punishment can again be the development of large buildings next to their property. Those who refuse to punish the non-punishers can be punished the same way, etc, in concentric circles around the original violator.
The incentives provided by dynamic games such as this one may seem strange, but can be easily coordinated by a homeowners’ association without any legal power. The association simply publishes the rule that (a) enlargement of current buildings or the construction of new ones is forbidden and (b) if someone breaks the rule, then any new construction in a specified radius around the first rule-breaker is allowed. If one enlargement or new building is profitable, then typically a few extensions next to it are also profitable. The fewer neighbours of the first rule-breaker that build bigger houses as punishment, the more profitable an extension is for any neighbour. So some neighbours will punish the first violator. This will make the house prices of other neighbours fall, which reduces the cost to them of selling their houses to property developers for apartment building construction, i.e. reduces the cost of punishing the original rule-breaker.

Buildings replaced quickly, so built badly

In a fast-growing city, many buildings will be replaced by larger ones in a decade or two. Property developers probably take this into account, thus do not hesitate to build low-quality non-durable housing. If the city growth stops at some point and buildings are no longer quickly replaced, then the owners of such housing will get an unpleasant surprise.
People buying or building detached houses do not seem to take city growth into account, because at least in Canberra, I see the erection of large expensive mansions in districts where the house will in 20-30 years be surrounded by high apartment buildings. Tall structures around a mansion tend to reduce its value, and certainly make the garden less private. The investment in fancy gardens, backyard swimming pools, etc, seems a bit short-sighted in locations close to the centre of a growing city.
The mansions also fill most of the plot of land on which they stand, so from an energy efficiency point of view, they might as well join walls with neighbours, as I have written before.

Joining together detached houses saves energy

Suburbs in many countries consist of detached houses that very close to each other – I have seen neighbours’ walls half a metre apart. Both houses could save energy by joining their adjacent walls together, which reduces heat loss in cold weather and heat entry (thus the need for air conditioning) in hot temperatures. Ideally, the joining should happen at the construction stage, but it is not difficult to do after the houses are built. Just enclose the space between the sides of two houses by extending the front and back wall and the roof of each house. It is not a load-bearing construction, it just has to keep the wind out from the space between the houses and provide some insulation to the space.
An added bonus is the creation of a covered storage area (a door to the space between houses should be created if the houses don’t already have a door on that side). A possible downside is that to get from the front of the house to the back, now one has to pass through the house or the storage area. But given the narrowness of the typical walkway between suburban detached houses, passing through the house may be the best route anyway. Also, when enclosing the walkway, a door can be made in each end to keep it open for passage.
Another downside is that windows on the side of the house now look into a covered storage area, not outside. But if the houses are so close together, then the only view from the window is the wall or window of the neighbour. After enclosing the side, this view becomes darker, but that does not seem a great loss. If it is, then energy-efficient lights can be installed in the enclosed area and kept on during waking hours, so people can admire their neighbour’s wall or window. Really, windows with such views can be replaced by a poster-size print-out of a photo of the view, because if the window looks into the neighbour’s window, then the neighbour probably keeps the curtains closed to prevent spying. And a wall through a window looks pretty similar to a photo of the wall stuck over the window.
The real reason to not join the houses is probably marketing and the desire to show off that it targets. People want to boast of owning a detached house, even if it is less than two metres from the neighbour’s. Knowing this, property developers construct such dwellings and market them as detached (“own your own house”, really owned by the mortgage issuer for 25 years). This is similar to the reason why McMansions are built, only the income of the buyers differs. Also similar are the pride and marketing that make people buy large SUVs, pickups and all-terrain vehicles for driving solely on paved roads.

Silly balconies

Everywhere in Australia, I have seen buildings with balconies that overlook busy roads. The view from the balcony often only includes other buildings. These balconies seem useless, because not many people want to sit in the street noise and car exhaust. I have rarely seen anyone on these balconies, and then only moving around for a practical purpose, not enjoying the air and view. Mostly the balconies are used for storing unwanted furniture and sports equipment, or growing potted plants. This makes sense, because even drying laundry over a busy road is problematic – everything gets covered in fine black soot. What does not make sense is adding these balconies to the buildings in the first place. A more practical use of the space would be to close the open parts of the balcony and thus add an extra room to the apartment. It is used as a storage room anyway.

In some cases, the building might have been constructed before the street became too busy or the views blocked by other buildings, but most of the buildings with balconies are new, so this explanation does not apply.

The reason the developers add balconies to their buildings is probably to market the apartments to impractical people. An included balcony makes the apartment sound more luxurious, and usually the view and relaxation opportunities of the balcony are touted in the advertisement. But people inspect the apartment before buying, so they should see the uselessness of the balcony for anything but storage. Inspections are usually scheduled on Saturdays when there is less traffic, and the inspecting buyers don’t sit on the balcony for long enough to become annoyed by the noise and the car exhaust.

There may be rules against the owner of an apartment closing up the balcony to create a room, because this makes the building facade uneven. Coordination problems between apartment owners may prevent them from closing up all the balconies of the building simultaneously.

When to permit new construction

In places with zoning laws (restrictions on what kind of buildings are allowed at a given address), there is often debate on whether to relax the restrictions. This would allow new construction or enlargement of existing buildings. The renters are generally in favour of more buildings, because the increased supply of housing lowers prices at a given demand. The landlords oppose construction, because it reduces the rents they can charge. These economic arguments are already part of the debate.

Much lobbying effort (that costs time and money and may create corruption) could be avoided if the market price of housing (rents or house transactions) was used directly in the regulations. New construction is allowed if the average rent is above a cutoff and denied below. Zoning laws may be a bad thing overall, but if they are to remain, they could be made more resistant to manipulation by basing restrictions on objective indicators, not lobbying.

The good incentives created by this require interest groups to put their money where their mouth is: if landlords want to prevent new construction, they should lower the rents they charge. Only with average rents low would building be blocked. Similarly, if tenants want more housing, they should pay the landlords more. They may of course decide to pool their money and found a property development firm instead.

Property developers want to get construction permits for themselves, but deny them to other property developers (their competition). The motivation to get a permit by fair means or foul is stronger when property prices are higher. In this case, the above reliance on the market price to regulate permits does not create good incentives. If new housing is allowed when prices are high, developers are motivated to form a cartel and raise the price. Permits reward high prices. A good price-based regulation of property development would require the opposite of the rental market mechanism – a low selling price of new housing should lead to more construction permits.

Raising the efficiency of the housing market

Empty housing is wasteful from society’s point of view. Both landlords and renters would benefit from finding a suitable counterparty to contract with faster. There are already online systems for listing housing for rent and sale, and also notice boards for people seeking housing. This is a good start, but a predictive system would be better. Given enough data, computers could forecast who is a good tenant or landlord and which apartment or house suits a given person’s preferences. Less searching would be needed by all involved.

Rental agencies already have a tenant database where they exchange references for renters. A similar online system should be created for landlords and housing (distinguishing the two). Also, the rental agency or real estate bureau should be rated separately from the people working in it, otherwise bad agents may move from one employer to another and escape their reputation. A bad notoriety may even motivate a person to change their name. For good agents, the loss of a reputation not tied to their person may make it difficult to change jobs.

Instead of chancing on complaints or praise in forums, a renter could see a summary rating of many rental agencies, agents and buildings in one place. The building database should include objective measures like the distance of a building to the city centre and the nearest supermarket, the yearly electricity and heating bills, the outdoors noise level in decibels, some average air pollution measure, school catchment areas, floor plan and area, etc. This saves labour for prospective tenants, so each of them does not have to search for the same data from various sources. Information entered by past renters is hopefully objective and protects novice tenants like students from being misled by advertisements like “five minute drive to the city centre” (only at 3 am when the roads are empty, in a Formula 1 car), “short walk to the supermarket” (short compared to the Shackleton Solo expedition), “safe neighbourhood” (compared to a war zone), “quiet” (relative to a rock concert), “spacious” (roomier than a shoebox), “close to nature” (insects and rodents inside). Distances to various landmarks could be automatically downloaded from Google Maps when the building address is known. Crime, pollution and traffic density statistics could similarly be autocompleted.

Renters should be able to select the measures they consider important in the data and get a ranking of the housing on offer according to these. Once someone has rated several apartments, the system could potentially predict the housing that would please that person.