Imagine this: You have finally found a buyer for your house, and he is willing to take it "as is" with a quick escrow. Just in the nick of time. But wait. First, you have to schedule a state-mandated energy audit, and then, before closing, you will have to take whatever retrofit measures the audit calls for. Bye bye quick escrow. And so much for the "as is" sale. Ah, California, there's no place like it for conducting real estate business.

No, there aren't currently any requirements in place that would create such a scenario. But if the supporters of Assembly Bill 2678 (Nunez and Laird) have their way, there certainly could be.

AB 2678 was introduced in February of this year. It has already been heard by, and passed, the Committee of Utilities and Commerce. According to the Committee's staff summary, "[the bill] requires the California Energy Commission (CEC) to establish an ongoing proceeding to develop requirements for time-of-sale energy-efficiency audits for residential and commercial buildings." Further, "[it] requires the CEC to apply any considerations deemed appropriate, including the availability of energy auditing systems, mechanisms for determining levels of energy-efficiency investments, the costs of energy-efficiency investments, [and] the ability to finance energy-efficiency improvements as part of the mortgage or sales agreement ..." [my emphasis].

The California Association of Realtors® (CAR) is strongly opposed to this legislation as it is currently formulated. CAR is urging its members to make that opposition known to their respective representatives in the Assembly.

Why this opposition? It is not because CAR doesn't like energy efficiency. It is because this bill would impose those requirements at the time of a sale, and only at the time of a sale. If you are not selling your home, the legislation would not require you to have an energy-efficiency audit nor would it require you to make any "energy efficiency investments."

Among other things, CAR notes in its opposition, "Research shows that only 22 percent of the properties most in need of energy efficiency retrofits will actually be sold by 2020. AB 2678 will be grossly ineffective in achieving its goals." Moreover, CAR adds, "The mandatory audit and retrofit requirements ultimately created could add THOUSANDS of dollars to every transaction. And every $1,000 increase in the price of a home disqualifies 26,600 families from owning."

AB 2678 is similar to many of the other proposed time-of-sale requirements that have been introduced over the years. These have included proposals ranging from requirements to install low-flush toilets to requirements to add safety features such as swimming pool gates. The goals of such legislative efforts may be worthy. (That is a different argument, to be decided on a case-by-case basis.) But if they are worthy, then why not impose them on everyone, not just those who are selling or buying a home?

The answer, of course, is clear. The electorate as a whole would likely not put up with the imposition of such often-costly requirements. Trying to force such things on everyone would shorten the political life of most legislators. But, making it a time-of-sale requirement doesn't require such risk. Persons who are buying or selling a home constitute a continually-changing and legislatively unrepresented class. They are, in a word, vulnerable to the mandates and bright ideas of government.

Fortunately, there is a group that does look out for the interests of home buyers and sellers. That would be CAR in California; and counterpart state Realtor® organizations throughout the U.S. With respect to federal legislation, it is the National Association of Realtors®. To be sure, looking out for the interests of home buyers and sellers may also be a self-interested thing for Realtor® organizations to do. But what's the wrong in that? It's better than putting a burden on home sales for the sake of making political points.