RT Journal Article
SR Electronic
T1 PACE Loans: <em>Does Sale Value Reflect Improvements?</em>
JF The Journal of Structured Finance
FD Institutional Investor Journals
SP 6
OP 14
DO 10.3905/jsf.2016.21.4.006
VO 21
IS 4
A1 Laurie S. Goodman
A1 Jun Zhu
YR 2016
UL https://pm-research.com/content/21/4/6.abstract
AB This article determines how the resale value of homes with PACE (Property-Assessed Clean Energy) improvements and financing compare with similarly situated homes that have no PACE involvement. The authors use a number of different methodologies to show that the net impact of PACE on resale value of a home, after taking into account the cost of improvements, ranges from $199 to $8,882. Moreover, the premium for PACE homes purchased out of foreclosure was closer to the higher end of the range. They conclude that a home with a subordinate PACE loan will provide collateral for FHA and GSE recoveries in a foreclosure sale that is at least as high as comparable properties without PACE improvements.TOPICS: MBS and residential mortgage loans, legal/regulatory/public policy