Portland Residential Home Energy Score Requirement Takes Effect January 1

Real Estate and Land Use

12/14/2017 by David J. Petersen

Portland Residential Home Energy Score Requirement Takes Effect January 1
Starting January 1, 2018, single-family home sellers in Portland will be required to report a Home Energy Score (HES) to potential buyers. The HES is a federally-developed measurement of the energy-related use and associated costs for a home, and is scored between 1 and 10. A HES of 5 means that the home's energy use is comparable to the average Portland home. A score of 10 places the home in the top 10% most energy-efficient homes in the city; a score of 1 places it in the bottom 15%. The HES can be used to qualify for energy-efficiency financing through Fannie Mae and FHA, and properties with a good HES (6 or higher) will stretch some lenders' debt-to-income ratio requirements, making it easier for buyers to qualify for a mortgage.
The HES is determined via a Home Energy Report, prepared by an authorized Home Energy Assessor. The site visit takes about an hour, and the report is expected to cost around $150-250. Assistance is available through the City for low-income sellers. In some cases, newly-built homes can receive their HES through review of the construction plans.
The HES must be reported in any advertisement of the home, whether directly by the owner or through a broker's listing such as RMLS. The full Home Energy Report must be made available to prospective buyers for review during their inspection process. Failure to comply is first enforced with a warning, and then a series of periodic fines. Sales via foreclosure or in lieu of foreclosure are generally exempt, and hardship exceptions are available.
After Berkeley CA, Portland is the second U.S. city to mandate HES disclosures, and the first to require it in sales materials. The HES requirement helps implement Multnomah County's 2015 Climate Action Plan, an effort to reduce carbon emissions in the County by 80% by 2050. More information about the HES program can be found at the City's dedicated website.