Guest Pontificating over at Digging in the Driftless

September 5, 2010

I don’t have any energy to write a new post for this blog because I’ve been devoting my extra typing time to my mom’s blog Digging in the Driftless.  For those who weren’t already aware, I am (slowly and thorough an un-ending iterative process) designing a house which my parents eventually plan to build on their land west of Madison and move to in 2012 and mom occasionally conscripts me to write green building related posts about the process.

This last installment deals with trying to keep bank financing out of the green building process  – as my parents hope to.  This is it … or you can read it and several comments in situ here.


Last Tuesday, Denise posted about how she and Doug are planning to apply the Goldilocks Principal to their building time line.

Rather than build their new home and move into it directly from their existing house in Madison, they are planning to sell their current house and seek  small interim shelter  through the construction phase before they move into their new home.

This is a great strategy for paring down the design to essentials, but it has another very important benefit.  By selling their house before they start to build, they will have the capital  for their eco-dream home without a bridge loan or mortgage.  I am an architect (in training) not a finance expert, but I do have  strong feelings about banks and the building industry.

Boring American Houses … available by the millions

The company I work for, Whole Trees Architecture and Construction, recently hosted a young Italian architect.  Over a bottle of wine and a plate of pasta carbonara, he asked us why all American neighborhoods seem so generic.

It’s not that we have no taste, I explained.  It’s simply that we move around too often.  Americans almost never buy a house “for life,” so we’re afraid to build the kind of  space we actually want to live in.  We’re driven by the almighty power of “resale value”.   Both new construction and remodeling are completely dominated by the latest hot-button trend for an under counter “drinks fridge” or white tile bathroom.

Doug and Denise succumbed to this pressure when they fixed up their fixer-upper.  Because they were planning to move soon to their land, they got talked  into granite counters and oak cabinetry as well as a master bathroom.  There’s no question some of these new features are pleasant, but none of it references their style or lifestyle.    And that granite counter … its a constant pain to clean.  Will it help sell the house?  Remains to be seen.

The Bank’s Perspective

Bank-financed homes (read, most homes) are the extreme example of  this “Granite Counter Problem.”   Bank loan officers do not care about design or good taste.

No, their employers expect them to promote the easy and profitable turnover of  housing stock.  They think that means the most generic house possible.  [Yes.  I’m dissing the American mortgage system and not even talking about the housing crisis.  Well, folks, the banks are responsible for a lot of bad things, all at the same time.]

But who is going to live in these blah-built houses?   Who will wake up within these over-sized walls, raise children, entertain friends and follow their dreams in Pine View Hills (sorry, no pines and no hills) Floor Plan 228-b?  (Hint: It’s not the loan officer.)

Why are we letting bankers (of all people) decide how we live?

Whole Trees Case Study

Sadly, we often do because we don’t have an alternative.    This is something I ran into in the course of my design work.  Last summer a woman came to us for a very small house design.  She wanted to build a small retreat in the woods on land she had recently acquired.  Her goal was a cozy, open feeling with a minimal bathroom and a single bedroom.  She’d given the plan a lot of thought, and we soon designed a little gem  for her.  We worked up the full drawing set, which she took  to her bank for financing.

Full stop!   The bank couldn’t find any “comparables” with only one bedroom, was uncomfortable with the green building elements and flatly refused to finance the project.

Our client was heartbroken.  We approached several other banks and heard the same thing from all of them.  At the height of the housing crisis when every news station in the country was decrying the glut of over-large homes on the market, no bank would consider supporting this small one.  (Oh there, I did mention the loan crisis.)

In the end we were able to re-design the house, adding a loft “second bedroom” over the first thus satisfying the bank’s paper requirements.  The end result was to make the space larger and more expensive – this will increase her mortgage, taxes and the space she must clean –  all directly contrary to her desires for her house.

Building without a bank frees you from the conventional thinking that goes hand in hand with conventional financing.

You can have anything you want.  You just can’t have everything you want.

So starting with what is probably a smaller amount of money to spend on your new home can help reign in your own plans, and that’s a good thing.

Studies have shown that when people pay for things with credit cards versus cash, they spend more extravagantly and tend to forget their purchases more quickly.  I would bet that the same applies to a mortgage loan versus your own savings.

Banks are infamous for urging people to go to the upper limit of their loan eligibility and take out larger mortgages than they really want or need.  This fuels house inflation on every level … something you want to avoid when building green.

Saving for and paying for your construction costs up front is a constant and visceral reminder to make your design choices wisely.   While you’re weighing the need for (say) an exercise room in your house, think about average cost per square foot, if it will require changing the footprint of the house, what additional electricity and plumbing needs it might have … and the extra “stuff” you’ll inevitably fill it with.  Then balance that against the cost of joining a gym, buying a used bike or just walking Fido more often.

The easiest and cheapest way to make your house more sustainable is to make it smaller, and the best time to change the design is in the conceptual stage.  The cash-up-front rule reminds you to really think all your choices through and weigh them against each other.

In the end, not only will you have a smaller house, more perfectly tailored to your needs, but you won’t have decades of mortgage payments tying you to a lifestyle you might not prefer and may not even be able to maintain.


One Response to “Guest Pontificating over at Digging in the Driftless”

  1. denisedthornton Says:

    To me, the term “conscripts” seems a little harsh.

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