The Washington Report

The National Association of REALTORS® (NAR) joins the National Association of Home Builders (NAHB) on an amicus brief supporting a legal challenge to the U.S. Department of Energy’s (DOE) rules that set energy‑efficiency standards for gas appliances.  

Petitioners, the American Gas Association (AGA), and other natural‑gas trade groups have asked the U.S. Supreme Court to review the lower court’s interpretation of these rules, which require efficiency levels achievable only with newer condensing technology. This change would effectively eliminate widely used non‑condensing gas furnaces and commercial water heaters from the market. Non-condensing units are currently installed in most homes and buildings using gas appliances. Because condensing units require entirely different ventilation systems, many existing homes and buildings simply aren’t compatible with the mandated technology. Replacing a failing non‑condensing unit could force owners into expensive renovations or require switching to electric appliances. These challenges are especially significant for space‑constrained homes such as rowhouses, townhomes, and older apartments. The rules pose significant affordability challenges and may introduce new disclosure and liability risks for REALTORS® during real estate transactions.

If the Supreme Court agrees to review the case, it will consider whether DOE had overstepped its authority under the Energy Policy and Conservation Act (EPCA), which prohibits efficiency standards that effectively remove products with unique performance characteristics from the market.

NAR’s legal advocacy efforts to support consumers and housing affordability remain a priority. NAR will continue to monitor any developments in this case and provide updates accordingly. 

USDA Rural Development announced changes to policies governing its Section 502 direct loan program earlier this month, which helps low- and very-low-income borrowers purchase homes in rural areas. The changes, effective February 10, touch on several aspects of how loans are processed and who qualifies.

The most significant change for homebuyers is a reduction in the program's loan limit. Previously set at 80% of local HUD limits, the cap has been lowered to 60%, meaning borrowers will have access to less financing than before. USDA also removed the ability to grant exceptions to this limit.

Among the other updates, SNAP benefits will no longer count toward a borrower's income when determining eligibility, and appraisals must now be completed before a loan can be approved, eliminating the prior practice of obligating loans "subject to appraisal." Applicants with unresolved federal debt will no longer be able to seek an exception to continue the application process. The certified packaging fee has been capped at $750, and the 38-year loan term now requires state director approval.

When direct loan funds are unavailable, applicants will now be directed to consider the Section 502 guaranteed loan program as an alternative. USDA also updated its priority processing thresholds for loans that include affordable housing financing.

Unlike formal rulemaking, handbook updates do not require public notice or a comment period, so these changes were not subject to formal stakeholder input before taking effect.

NAR will continue to monitor implementation of these changes and their impact on rural homebuyers and REALTORS® serving rural markets.