Last reviewed: September 2026 · By the HVAC Brief Editorial Team · Our sourcing and editorial standards
Renters are twice as likely as homeowners to live in a poorly insulated home, two and a half times as likely to find it drafty, and more than twice as likely to cool it with window units.
This is the split incentive, visible in federal data: the landlord pays for upgrades, the tenant pays the bill, and rental housing ends up older and leakier. It covers 39.4 million renting households.
About 39 million US households rent and 83 million own. EIA’s Residential Energy Consumption Survey records the heating and cooling equipment, thermostat and building condition of both, which makes it possible to measure the gap directly rather than argue about it.
The gap, measure by measure
| Measure | Owners | Renters | Renters vs owners |
|---|---|---|---|
| Heating equipment 20 years old or more | 18.3% | 23.7% | 1.3x |
| Air conditioning 20 years old or more | 9.9% | 9.0% | 0.9x |
| Has any air conditioning | 91.2% | 83.5% | 0.9x |
| Central air (of homes with AC) | 81.5% | 62.0% | 0.8x |
| Window or wall units as main cooling (of homes with AC) | 13.8% | 32.3% | 2.3x |
| Heat pump as main heating (of heated homes) | 14.7% | 14.4% | 1.0x |
| Smart or programmable thermostat | 61.8% | 36.3% | 0.6x |
| Poorly insulated or not insulated | 14.9% | 31.1% | 2.1x |
| Drafty all or most of the time | 8.5% | 21.0% | 2.5x |
| Could not use air conditioning at some point | 4.6% | 6.2% | 1.3x |
| Could not use heating at some point | 3.4% | 5.3% | 1.6x |
| Electricity included in rent or condo fee | 0.8% | 10.5% | 13.1x |
The building is the biggest gap
The largest differences are in the building itself, not the equipment. 31% of renters describe their home as poorly insulated or not insulated, against 15% of owners. 21% say it is drafty all or most of the time, against 8.5%.
That matters for heating and cooling because the envelope sets the load. A leaky home needs more capacity and costs more to keep comfortable, whatever equipment is installed. Our insulation analysis shows how this varies with the age of the housing.
Older heat, cheaper cooling
Renters’ main heating equipment is older: 23.7% is 20 years old or more against 18.3% for owners. Their cooling is more often a window or wall unit than central air, and less often controlled by a smart or programmable thermostat.
Two measures are close to identical: heat pump use and the age of air conditioning equipment. The split incentive shows up most clearly in the things a landlord would have to invest in and a tenant would benefit from, such as insulation, sealing and central systems.
Who pays the bill
10.5% of renters have their electricity included in the rent. For them the incentive runs the other way: the landlord pays the bill and the tenant has little reason to conserve. Either way, the party making the investment decision is not the one bearing all the costs. Equipment age across the whole stock is in our equipment age analysis, and households that lost the use of their systems are in our energy insecurity report.
Frequently asked questions
Do renters have worse heating and cooling than homeowners?
On most measures, yes. Renters are about twice as likely as owners to live in a home they describe as poorly insulated or not insulated (31% against 15%), and about two and a half times as likely to find it drafty all or most of the time (21% against 8.5%).
What is the split incentive?
It is the problem that the person who pays for an efficiency upgrade is not the person who benefits. A landlord who installs insulation or a better system pays the cost, while the tenant who pays the energy bill gets the savings. With little reason to invest, rental housing tends to have older, less efficient equipment.
Is renters’ heating equipment older?
Yes. 23.7% of renters’ main heating equipment is 20 years old or more, against 18.3% for owners. Air conditioning age is similar between the two groups.
How do renters cool their homes?
Far more often with window or wall units. 32% of renters with air conditioning rely mainly on window or wall units, against 14% of owners. 84% of renters have any air conditioning, against 91% of owners.
Do renters have smart thermostats?
Much less often. 36% of renters have a smart or programmable thermostat, against 62% of owners.
Are renters more likely to lose heating or cooling?
Somewhat. 6.2% of renters could not use their air conditioning at some point in the year, against 4.6% of owners; for heating the figures are 5.3% and 3.4%.
Is anything the same for renters and owners?
Heat pump use is almost identical: 14.4% of renters’ heated homes against 14.7% of owners’. So is the age of air conditioning equipment.
Methodology and limitations
- Source: EIA Residential Energy Consumption Survey 2020 public use microdata v7, KOWNRENT (1 own, 2 rent). The small group occupying without paying rent is excluded from both columns.
- Each measure uses its own base, shown in the table label: for example, central air and window units are shares of homes with air conditioning, and heat pump use is a share of heated homes.
- Insulation and drafts are respondent-reported (ADQINSUL, DRAFTY), not measured by inspection.
- Equipment age is bracketed in RECS; the 20-years-or-more share is the top bracket.
- Every figure clears EIA’s reliability standard (relative standard error at or below 50, at least 10 sampled households), computed with EIA’s Jackknife method.
- Renters and owners differ in income, housing type and region, so these gaps describe the two groups as they are, not the effect of tenure alone.
Sources
- US Energy Information Administration, RECS 2020 public use microdata.
The HVAC Brief is an independent trade publication. We do not sell equipment, take manufacturer advertising, or accept payment for placement in our research. Corrections welcome.
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