Material and Construction Cost
Cost is one of the major challenges for the project. In comparison to a traditional 5 Khana Ger - which is usually around 1.5 million MNT- the estimated cost for the Passive Ger design is valued at approximately 29 million MNT. It is important to understand however why the cost difference between a traditional ger and a passive ger is so large and what the long term gains would be for investing in this energy efficient and urban-adapted version of the housing typology.
When taking into consideration the traditional costs of a 5 Khana Ger, one is often only paying for a few locally made components; Toono (Oculas), Uni (rafters), Bagana (Pillars), Khana (Walls), Haalga(door), Floor (Shal), Felt Cover of Roof Ring (Urkh), Roof (Deever), Wall Cover (Tuurga), White Dense (Outer Cover of Ger). All of these products are locally made, although some of the materials can be sourced from China and Russia, like the Chinese felt or the Russian wood. While the initial purchasing cost of the Ger is low, there are many long term maintenance costs that come with the housing system, such as having to: take down the gers twice a year to air out the felt in order to prevent mold growth, wash the interior wall textiles because of the dust collection from the coal, replace the outer content fabric and floor on average every 3 years, redig another 2 meter deep pit-latrine in your Hasha when the solid human waste in your original pit-latrine is overflowing, baggin and storing your coal every heating season - to name a few maintenance challenges. In addition the long term negative air, soil and water pollution risks would like result in serious long term health risks for all members of the family. The long term costs of a traditional Ger therefore could entail larger long term costs.
As a result, seeing the Passive Ger as long term investment would reward households with better quality of living and healthier environmental conditions and while potentially being more cost effective in the long term. At an area of 56.12 M2 and a total cost of 29 million MNT, the cost per square meter of the Passive Ger is approximately 516,750 MNT per M2; making the energy efficient housing typology a competitively housing solution, as the Passive Ger is a more affordable price in comparison to other apartments and homes in Ulaanbaatar for the same square footage and potentially less amenities.
Financial Package
While energy efficiency is a critical goal for the Passive Ger, affordability is ultimately what enables the project to be feasible in the long term. Taking into consideration the subsidized interest rate (eight percent) that the MGFC would provide, a general financial packaged for the housing product has been outlined to ensure the owner’s ability to pay the mortgage - while bundling in the costs of the alternative heating system to the coal burning stove.
The table below outlines the key financial components that were taken into consideration in order to develop a comprehensive financial package, to arrive at an affordable monthly mortgage payment of 212,400 MNT per month for an average household income of 1 million MNT per month. The table includes: the current selling price of the Passive Ger at 29 million MNT, the minimum initial down payment of the future homeowner of 9 million MNT, the price of the air to air heat pump at 3.6 million MNT, the loan size of 23.6 million MNT, a ten year loan period (which is the most commonly prefered period of time to take out a housing loan according to Arig Bank), and the subsidized interest rate of 8%.
In addition, in order to ensure that the Passive Ger is properly insured, homeowners will be encourage to purchase housing insurance from Practical Daatgal or Bodi Daatgal (which are Mongolian insurance agencies that provide comprehensive packages to cover the Passive Ger’s housing system) to not only protect the property’s value by financial protection against damage due to disasters, theft and accidents.
Operating Costs
The energy efficient components of the Passive Ger were carefully value engineered in order to focus on the most essential modern amenities while avoid excessive operating costs. By staying close to the standard operating costs of a 5 member family in a 5 Khana Ger, and taking into consideration how much the average family currently spends on coal (335 USD for the total heating season), electricity (20,000 MNT per month) and water (2,000 MNT per month at the water well).
In comparison, with the Passive Ger, the estimated heating costs with the air-to-air heat pump system is a total of 257 USD (base on a study conducted my Kirk Smith and the ADB - and estimated to cost lest based on the energy efficient building envelope of the Passive Ger, standard electricity consumption of other household appliances (20,000 MNT per month) and water (15,000 MNT per month with the water truck). As a result, in comparison to the traditional operating cost of 1,101,500 MNT for a standard 5 Khana, the Passive Ger’s operating costs are estimated at 1,062,500 MNT.