Understanding Home
Decision Making
Residential buildings account for approximately 20% of energy consumption in the U.S. To achieve local, state, and federal decarbonization and electrification objectives, it’s important to understand how people make and prioritize decisions about their homes.
Some energy efficiency research is conducted myopically seeking to understand the potential for residential electrification in isolated studies about residential HVAC systems, smart thermostats, water heaters, windows, etc. Narrow research questions asked in isolated settings fail to fill in the complete picture of home decision-making as it relates to energy.
ILLUME interviewed 121 home renters and owners across four states to better understand the broader context of home improvement decision-making. We took an exploratory approach that leveraged open-ended interviews, where we asked people how they used and viewed the space of their homes, changes they had made or were thinking of making, and habits of home maintenance and care.
Through these conversations, we learned that people make decisions about their homes and energy-using (or saving) equipment in the context of broader priorities and concerns related to their homes, families, and everything else going on in their lives.
Introducing the Decision-Making Framework
ILLUME’s core research revealed a six-factor framework to understand how people perceive their homes and explore their motivations to make changes. Through this visualization, policymakers, energy industry professionals, and program designers can examine the intricate interplay of decision-making factors and their impact on achieving sustainable and energy-efficient homes.
To bring the framework to life and provide a personal perspective, we share profiles of a few people who participated in our study. Their stories highlight the application of the framework and illustrate how it can guide effective decision-making in a relatable context.
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Attitudes
Home means different things to people and depends on other factors, such as life stage, values, and identity. These factors impact how people experience their homes and what and why they make changes to them.
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Maintenance
People approach home maintenance differently, ranging from proactive planned home maintenance tasks to reacting to broken appliances or a problem impacting comfort, safety, or the ability to use a space.
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Resources
Resources include time, money, energy, and access to technologies, materials, and contractors.
Resources are the driving force behind home improvement possibilities and they vary across people and change over time. -
Characteristics
People take space, existing equipment, and the characteristics of their home into account when considering the type of appliance they want to install or the renovation they want to take on.
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Upgrade Type
People are more likely to prioritize visible exterior and interior upgrades to their homes. The complexity and visibility of an upgrade also impact whether people opt to use a contractor or take a do-it-yourself (DIY) approach.
Renter Disempowerment Impacts Opportunity
Renters are more constrained than homeowners in their ability and agency to make choices to upgrade appliances or renovate their homes. Many renters expressed concerns about asking for too much from their landlord or maintenance person, citing concerns about rent increases, being perceived as too high-maintenance, and the time and hassle required to get their landlord’s attention.
Angela’s Story
Angela lives with her family in a three-bedroom, two-bathroom townhouse that she rents in Tucson, Arizona. She and her family like their neighborhood and its proximity to the school and local amenities, however, she describes her landlord as both intrusive and negligent.
“I’m scared that if I ask the landlord for money for [work I did in the apartment], he might raise the rent on us knowing that the unit is now more valuable. I don’t think they’re going to mind, but I also don’t want them to know that we’re improving the place and then they increase the rent.”
Angela, Renter, Tucson, AZ
At one point, both the washer and dryer in her townhouse broke, and the landlord only replaced the washer, telling her to hang her clothes outside to dry in the Arizona sun. The landlord refused to purchase or fix her broken dryer, so Angela wound up purchasing a new dryer on clearance for about $400 on her own. Now she refuses to communicate directly with her landlord.
Angela’s priorities before the negative interactions with her landlord
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Attitudes
Angela likes the features and spaciousness of the townhome they are renting, and particularly the convenience and location near to their children’s school and other amenities.
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Maintenance
Angela prioritizes regular cleaning, but as a renter, she is often more reactive than proactive when it comes to repairs and replacement.
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Resources
Angela is budget conscious, and with two kids and a full-time job, she has limited time for home projects or to ask her landlord to address issues.
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Characteristics
Angela’s environment (hot summers of Arizona) and her identity as a renter impacts how she makes decisions to purchase new appliances or prioritize renovating her outdoor space.
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Upgrade Type
Angela wants to upgrade her visible outdoor space for her family to enjoy.
Angela wants to update and create a beautiful outdoor space too. But constrained communications with the landlord resulted in delays in resolving other issues in the townhouse – including a non-functional shower and plumbing issues.
Angela’s priorities after the negative interactions with her landlord
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Attitudes
Angela’s poor relationship with her landlord impacts her ability to address issues and impacts how she feels about her home.
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Maintenance
Angela has had to deal with additional repairs and replacement because of her negligent landlord.
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Resources
Angela and her husband feel they need to address any issues in the home, even those that should be taken care of by the landlord, such as plumbing issues. This puts additional constraints on their already-limited time and financial resources.
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Characteristics
Angela likes the townhouse features, but is considering looking for other places to live because of her poor relationship with the landlord.
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Upgrade Type
Angela wants to upgrade her visible outdoor space for her family to enjoy, but she may need to invest money into upgrading her showerhead and/or purchasing a new dryer – two upgrades that are less visible to others but will increase her happiness and satisfaction with her home.
Many renters, like Angela, are more likely to live without appliance upgrades and renovations that support electrification and decarbonization objectives. Angela’s relationship with her landlord impacts her attitude about her home and her financial resources because she has had to pay out of pocket for changes her landlord should have covered. She and her husband are budget conscientious and try to figure out how to complete repairs on their own.
Application to Energy Efficiency
In many instances, renters are more likely to pursue lower-cost, surface-level upgrades. Most electrification upgrades will require the landlord to act, and it’s unlikely that renters will be able to advocate for these changes on their own.
Tools such as building codes and incentives targeted at building owners may be more effective means of promoting electrification in the small multifamily sector. Application of these tools should consider how to protect tenants, so renters are not priced out of their homes because of the implementation of these upgrades.
Ability to Choose Impacts Emotion Around Home Choices
In our interviews, people were excited to share their choices about some home projects, while the emotions around other home projects were much more negative. In general, we found that people tended to prioritize more visible and frequently used rooms, spaces, and appliances for upgrades, and, when discussing these projects, they described feelings of joy and empowerment. This reflects positive feelings about being able to make meaningful changes to elements of the home that they interacted with daily.
In contrast, when unforeseen or emergency repairs or replacements needed to be addressed, people were more likely to describe feelings of stress, frustration, and disempowerment. That these emergency situations often involved the invisible systems of the home (e.g. a roof leak, water heater replacement, or HVAC failure), reflected the lack of agency in choosing to make these changes
Diamond’s Story
Diamond lives in a 3,600-square-foot home in Macon, Georgia with her husband, and children. She shared a list of upgrades she would like to make, including new bathrooms and energy-efficient windows, to increase the home’s potential resale value and bring her energy costs down.
“I want my home’s windows to be efficient for the weather and to help the electricity bills go down. I want to keep my house up to par, so when we sell it, we have no problem because we maintained everything.”
Diamond, Homeowner, Macon, GA
However, recently a storm flooded and damaged her basement triggering her severe mold allergy. Her home insurance denied her claim and she is now saving money to make the necessary repairs while putting other projects on hold. The basement repairs became her top priority because of her mold allergy.
Diamond’s priorities before the flood
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Attitudes
Diamond is proud of her home and believes it is a special place for her family to build memories.
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Maintenance
Diamond proactively keeps up with upgrades so that her home and its appliances are energy-efficient and functioning properly.
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Resources
Diamond views her home as an investment and regularly addresses home renovations and appliance upgrades by setting aside finances to keep her home well-maintained. She reprioritizes home renovations to stay within her budget.
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Characteristics
Diamond appreciates her home’s layout, but has several renovation projects she would like to make, as her time and budget allow.
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Upgrade Type
Diamond has a long list of aesthetic updates she wants to make in her home, such as renovating the bathrooms and bedrooms, and less visible upgrades such as new energy-efficient windows.
Before the flood, Diamond prioritized aesthetic and functional upgrades to support her family life, including renovating the bathrooms and replacing windows. The damage caused by the flood has required her to put some of those projects on hold to focus on more immediate concerns related to mold and other impacts of the flood.
After the flood, Diamond’s priorities changed
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Attitudes
After the storm flooded her basement, she was disappointed to have to move out for two weeks because of the mold.
This has impacted her attitude toward the home, especially as she is concerned about her allergies and would like to reduce her symptoms. -
Maintenance
Repairing the basement has become the focus of her home improvement efforts in lieu of other projects such as upgrading the windows and doors.
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Resources
Because her insurance didn’t cover addressing the mold in the basement after the flood, Diamond’s resources have been stretched thin as she has had to prioritize more urgent home repairs over the home projects she wanted to complete.
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Characteristics
Diamond’s house projects have shifted to addressing necessary repairs to the basement because of the flood.
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Upgrade Type
Addressing the mold in the basement takes precedence and she is putting the renovations she hoped to do on hold.
Diamond’s priorities shifted significantly in the aftermath of the flood as all her home projects are now focused on addressing flood damage. Other projects have been put on hold until they have the time and money to address them.
Previous Experience—Good and Bad—Shapes Decisions
Many people explain their home decision-making in terms of their previous experiences with contractors, brands, or equipment types. In general, people we spoke with were more likely to do their own research when pursuing appliance upgrades and renovations that were simple, more visible, and for projects with longer timelines.
By contrast, for less visible and more complex upgrades, such as HVAC and water heater replacements, people are typically more comfortable relying on contractor recommendations. In some cases, however, poor previous interactions with a contractor significantly impact the person’s subsequent choices.
Eric’s Story
Eric lives by himself in a two-bedroom condominium in Chicago. Eric is concerned about the environment and interested in electrification, but conscious of waste. He’s in the process of renovating the bathrooms himself because of prior problems with contractors.
He’s hesitant to hire a contractor unless it’s for a larger more complicated renovation. Otherwise, he asks his friends to help him out on the weekends with his bathroom renovation.
“If I’m going to pay more for electrifying all my appliances in my house, the breakeven period can’t be longer than I plan to live in the house. Filling up the landfills [with old appliances] isn’t great either. So, we shouldn’t just electrify.”
Eric, Condominium Owner, Chicago, IL
Eric’s priorities when he moved in
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Attitudes
Although his condo was not his first choice—his previous home sold much more quickly than anticipated, and he needed to find a new home right away—it has features he loves. He is happy with how his living and work-from-home situation has turned out; he likes that the home has an open-concept kitchen, dining, and family area.
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Maintenance
Eric is comfortable with regular maintenance and upgrades but has been delayed by some supply chain issues.
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Resources
Eric is cost-conscious but also willing to invest in high quality items that will last longer. When he looks for new appliances, he shops around for the most cost-effective appliances that have the longest lifespans. Energy efficiency is important to Eric.
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Characteristics
He bought his condo with the plan to make updates to some “dated” features in the kitchen and bathrooms.
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Upgrade Type
Eric had a smart thermostat in his previous place and is thinking of installing one in this condo to adjust the temperature automatically.
He wants to eventually renovate his kitchen and when he does, he will shop around for the most cost-effective appliances with the longest lifespans. He thinks electrification sounds good, but there are so many variables at play that decision-making is not always easy. Eric says that reliability and functionality are the two most important features of appliances, but he also prioritizes aesthetics.
Eric’s priorities now
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Attitudes
Eric prioritizes aesthetics, but for him, reliability and functionality are the two most important features of appliances.
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Maintenance
Eric is comfortable with regular maintenance and upgrades but hesitates to make major renovations that require hiring a contractor after poor experiences with a contractor early on in his ownership of the condo.
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Resources
Since renovating his bathroom himself, he is taking the time to make sure he has the materials he needs. Eric is comfortable with doing his own research and describes himself as ‘frugal.’
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Characteristics
Eric likes the layout of the condo, but eventually would like to upgrade dated features in the kitchen. As an avid cook, he appreciates the kitchen and its 6-burner gas stove.
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Upgrade Type
Eric feels comfortable re-doing a small bathroom but says that he wouldn’t want to do a bigger project on his own in case he made a mistake that was costly or unsightly in a more central part of the condo. He wants to make aesthetic changes, but functionality and reliability are at the top of his priority list.
After some negative experiences with contractors (delays, poor quality work, and unfinished projects), Eric is focusing on the house projects he is confident he can complete himself. Since he’s doing this on his own, he’s taking more time to do research and collect the materials he needs before he starts demolition and renovation.
Application to Energy Efficiency
Contractors are critical players in promoting electrification technologies, not only in terms of what equipment to purchase but also in how it is installed and in explaining to the homeowner how to use the equipment correctly. In many cases like Eric’s, bad experiences with a contractor could result in overall lower satisfaction with new technologies and energy-efficient equipment.
Good experiences can shape future decisions too. It is important not only to train contractors to sell and properly install electrification technologies, but also to explain the equipment installed and how to optimally operate it, especially in conjunction with their existing system to improve the outcome for everyone.
How do we apply the Decision-Making Framework?
Using the decision-making framework’s factors to look across individuals, helps us see patterns in what people prioritize as they consider purchasing equipment or renovating their homes.
Meet People Where They Are
Marketing Takeaway: The framework helps to highlight opportunities for marketing, education, and outreach, based on people’s priorities and interests.
Program Design Takeaway: Understanding people’s priorities in terms of how they think of their home and are making decisions can enable program designers to create programs that better meet home occupant needs. For instance, rebates on equipment might not be a good fit for renters who do not have the ability to make changes to their equipment.
Contractors Are Critical Partners
Marketing Takeaway: Contractors are valuable channels for introducing new technologies to customers.
Program Design Takeaway: Investing in contractor education and training will enable them to serve as electrification liaisons in their communities. Similarly, energy concierges or electrification coaches can help bridge the gap in education around new technologies and how they might work in different situations.
Understand What Matters to People
Marketing Takeaway: Given that peoples’ concerns are broader than energy or energy savings, outreach and marketing should highlight more persuasive non-energy impacts related to comfort, health, and air quality.
Program Design Takeaway: Creative offerings designed to address air quality or other non-energy impacts alongside savings may allow efficiency programs to have a broader reach.
Using ILLUME’s decision-making framework provides valuable guidance and structure for the energy industry. By considering the factors in our framework, organizations can make more informed and strategic decisions that will lead to more effective and impactful outcomes.
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