PACE funds energy upgrades to buildings that create jobs, make properties more valuable, and help states achieve policy goals. It’s 100% voluntary and it’s being adopted in every region of our nation.

PACE Updates

New Analysis Shows Residential PACE Delinquency Rates Lower Than Those of Comparable Homeowners

PACENation welcomes new DBRS report showing “strong performance with very low delinquency levels.”

Today, credit rating agency DBRS released the first comprehensive analysis of residential PACE (R-PACE) delinquency rates that combines data across multiple years and PACE providers. Using data on R-PACE assessments over four tax years, the analysis found lower delinquency rates compared to all properties and single-family homes in California.

DBRS rates R-PACE asset-backed securitization transactions. The agency remarked that their analysis of delinquency rates showed “strong performance with very low delinquency levels,” and “consistent performance and very low volatility across tax years.” The analysis highlights the following:

  • The limited performance history shows strong performance with very low delinquency levels around 2% to 4% at the peak, declining to less than 1% within 12 months;
  • PACE delinquency metrics are lower than general aggregate property tax and single-family residential only property tax delinquency levels. PACE also shows consistent performance and very low volatility across tax years; and
  • Healthier performance relative to all residential tax payors may reflect self-selection of PACE homeowners to improve their properties.

PACENation welcomes the additional clarity this report brings to this important discussion. This data provides further confirmation that R-PACE remains a consistent and reliable way for homeowners to fund energy efficiency, renewable energy and resiliency upgrades to their properties. PACENation’s Executive Director David Gabrielson said “This report shows that PACE is a great option for homeowners who choose to make their homes more efficient, safer, and more comfortable – as over 180,000 homeowners already have.”

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MikeNew Analysis Shows Residential PACE Delinquency Rates Lower Than Those of Comparable Homeowners

RMI: FHA Should Reconsider their About Face—About PACE

Source: Rocky Mountain Institute (By Jacob Corvidae and Martha Campbell)

Last week, the Federal Housing Administration (FHA) announced it will stop insuring new mortgages on homes with property assessed clean energy (PACE) loans. As to what motivated its decision—according to its letter to the U.S. Department of Housing and Urban Development—the FHA is “concerned with the lack of consumer protections associated with the origination of the PACE assessment, which are far less comprehensive than that of traditional mortgage financing products.” This announcement directly contradicts guidance issued by the FHA in 2016.

Rocky Mountain Institute feels this decision is misguided for three key reasons.

  1. The FHA overstates the risk of PACE to taxpayers while failing to acknowledge or account for the significant default risk that the excessive energy expenditures of inefficient homes can create for a homeowner.
  2. This will inhibit homeowners from making valuable home improvements, while curbing PACE’s job-creation potential in the construction and renovation industry.
  3. It undermines existing state-level consumer-protection standards that are in place and federal standards that are in development, and may in fact guide homeowners toward more risky financing solutions, such as high-interest rate credit cards, that lack such standards.
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MikeRMI: FHA Should Reconsider their About Face—About PACE


Resources & Downloads

PACENation’s Consumer Protection Policies

PACENation’s consumer protection policies (CPP Version 2) represent the strongest protections and disclosures for homeowners investing in energy efficiency or renewable energy.

Study: PACE Makes Homes More Valuable

In the first economic study of homes with PACE upgrades, three different methodologies and three home price indices were examined and all turned up the same results; PACE is good for the resale value of homes, even after taking into account the financing costs. Published in the Journal of Structured Finance January 2016.

Whitepaper: Benefits of PACE for Commercial Real Estate Companies

For commercial real estate property owners, PACE financing can remove the typical barriers to the implementation of energy efficiency improvements. In this whitepaper, George Caraghiaur explains how to take advantage of the many benefits PACE provides to commercial real estate companies.

2009-2016 C-PACE Market Overview

From 2009-2016, the commercial PACE market provided financing for 1020 commercial projects that amounted to $340 million in total funding.