diff --git a/lib/elements/dom-if.js b/lib/elements/dom-if.js
index 70289708..8c09d912 100644
--- a/lib/elements/dom-if.js
+++ b/lib/elements/dom-if.js
@@ -16,6 +16,8 @@ import { microTask } from '../utils/async.js';
 import { root } from '../utils/path.js';
 import { wrap } from '../utils/wrap.js';
 import { hideElementsGlobally } from '../utils/hide-template-controls.js';
+import { fastDomIf, strictTemplatePolicy } from '../utils/settings.js';
+import { showHideChildren } from '../utils/templatize.js';
 
 /**
  * The `<dom-if>` element will stamp a light-dom `<template>` child when
@@ -85,7 +87,7 @@ export class DomIf extends PolymerElement {
   constructor() {
     super();
     this.__renderDebouncer = null;
-    this.__invalidProps = null;
+    this.__syncProps = null;
     this.__instance = null;
     this._lastIf = false;
     this.__ctor = null;
@@ -181,8 +183,11 @@ export class DomIf extends PolymerElement {
     let parentNode = wrap(this).parentNode;
     // Guard against element being detached while render was queued
     if (parentNode) {
-      if (!this.__ctor) {
-        let template = this._templateInfo ? this : /** @type {HTMLTemplateElement} */(wrap(this).querySelector('template'));
+      if (!this.__template) {
+        // When `removeNestedTemplates` is true, the "template" is the element
+        // itself, which has been given a `_templateInfo` property
+        let template = this._templateInfo ? this :
+          /** @type {HTMLTemplateElement} */(wrap(this).querySelector('template'));
         if (!template) {
           // Wait until childList changes and template should be there by then
           let observer = new MutationObserver(() => {
@@ -196,37 +201,63 @@ export class DomIf extends PolymerElement {
           observer.observe(this, {childList: true});
           return false;
         }
-        this.__ctor = templatize(template, this, {
-          // dom-if templatizer instances require `mutable: true`, as
-          // `__syncHostProperties` relies on that behavior to sync objects
-          mutableData: true,
-          /**
-           * @param {string} prop Property to forward
-           * @param {*} value Value of property
-           * @this {DomIf}
-           */
-          forwardHostProp: function(prop, value) {
-            if (this.__instance) {
-              if (this.if) {
-                this.__instance.forwardHostProp(prop, value);
-              } else {
-                // If we have an instance but are squelching host property
-                // forwarding due to if being false, note the invalidated
-                // properties so `__syncHostProperties` can sync them the next
-                // time `if` becomes true
-                this.__invalidProps = this.__invalidProps || Object.create(null);
-                this.__invalidProps[root(prop)] = true;
+        this.__template = template;
+        if (!fastDomIf) {
+          this.__ctor = templatize(template, this, {
+            // dom-if templatizer instances require `mutable: true`, as
+            // `__syncHostProperties` relies on that behavior to sync objects
+            mutableData: true,
+            /**
+             * @param {string} prop Property to forward
+             * @param {*} value Value of property
+             * @this {DomIf}
+             */
+            forwardHostProp: function(prop, value) {
+              if (this.__instance) {
+                if (this.if) {
+                  this.__instance.forwardHostProp(prop, value);
+                } else {
+                  // If we have an instance but are squelching host property
+                  // forwarding due to if being false, note the invalidated
+                  // properties so `__syncHostProperties` can sync them the next
+                  // time `if` becomes true
+                  this.__syncProps = this.__syncProps || Object.create(null);
+                  this.__syncProps[root(prop)] = true;
+                }
               }
             }
-          }
-        });
+          });
+        }
       }
       if (!this.__instance) {
-        this.__instance = new this.__ctor();
-        wrap(parentNode).insertBefore(this.__instance.root, this);
+        if (fastDomIf) {
+          const host = this.__dataHost || this;
+          if (strictTemplatePolicy) {
+            if (!this.__dataHost) {
+              throw new Error('strictTemplatePolicy: template owner not trusted');
+            }
+          }
+          // Pre-bind and link the template into the effects system
+          const templateInfo = host._bindTemplate(this.__template, true);
+          // Install runEffects hook that prevents running property effects
+          // (and any nested template effects) when the `if` is false
+          templateInfo.runEffects = runEffects => {
+            if (this.if) {
+              runEffects();
+            } else {
+              this.__syncProps = runEffects;
+            }
+          };
+          // Stamp the template, and set its DocumentFragment to the "instance"
+          this.__instance = host._stampTemplate(this.__template, templateInfo);
+          wrap(parentNode).insertBefore(this.__instance, this);
+        } else {
+          this.__instance = new this.__ctor();
+          wrap(parentNode).insertBefore(this.__instance.root, this);
+        }
       } else {
-        this.__syncHostProperties();
-        let c$ = this.__instance.children;
+        let c$ = fastDomIf ? this.__instance.templateInfo.childNodes :
+          this.__instance.children;
         if (c$ && c$.length) {
           // Detect case where dom-if was re-attached in new position
           let lastChild = wrap(this).previousSibling;
@@ -242,33 +273,41 @@ export class DomIf extends PolymerElement {
   }
 
   __syncHostProperties() {
-    let props = this.__invalidProps;
+    let props = this.__syncProps;
+    this.__syncProps = null;
     if (props) {
-      for (let prop in props) {
-        this.__instance._setPendingProperty(prop, this.__dataHost[prop]);
+      if (fastDomIf) {
+        props();
+      } else {
+        for (let prop in props) {
+          this.__instance._setPendingProperty(prop, this.__dataHost[prop]);
+        }
+        this.__instance._flushProperties();
       }
-      this.__invalidProps = null;
-      this.__instance._flushProperties();
     }
   }
 
   __teardownInstance() {
     if (this.__instance) {
-      let c$ = this.__instance.children;
-      if (c$ && c$.length) {
-        // use first child parent, for case when dom-if may have been detached
-        let parent = wrap(c$[0]).parentNode;
-        // Instance children may be disconnected from parents when dom-if
-        // detaches if a tree was innerHTML'ed
-        if (parent) {
-          parent = wrap(parent);
-          for (let i=0, n; (i<c$.length) && (n=c$[i]); i++) {
-            parent.removeChild(n);
+      if (fastDomIf) {
+        this._removeBoundDom(this.__instance);
+      } else {
+        let c$ = this.__instance.children;
+        if (c$ && c$.length) {
+          // use first child parent, for case when dom-if may have been detached
+          let parent = wrap(c$[0]).parentNode;
+          // Instance children may be disconnected from parents when dom-if
+          // detaches if a tree was innerHTML'ed
+          if (parent) {
+            parent = wrap(parent);
+            for (let i=0, n; (i<c$.length) && (n=c$[i]); i++) {
+              parent.removeChild(n);
+            }
           }
         }
       }
+      this.__syncProps = null;
       this.__instance = null;
-      this.__invalidProps = null;
     }
   }
 
@@ -283,7 +322,14 @@ export class DomIf extends PolymerElement {
   _showHideChildren() {
     let hidden = this.__hideTemplateChildren__ || !this.if;
     if (this.__instance) {
-      this.__instance._showHideChildren(hidden);
+      if (fastDomIf) {
+        showHideChildren(hidden, this.__instance.templateInfo.childNodes);
+      } else {
+        this.__instance._showHideChildren(hidden);
+      }
+      if (!hidden) {
+        this.__syncHostProperties();
+      }
     }
   }
 
diff --git a/lib/elements/dom-repeat.js b/lib/elements/dom-repeat.js
index e330dce9..03add1eb 100644
--- a/lib/elements/dom-repeat.js
+++ b/lib/elements/dom-repeat.js
@@ -339,7 +339,10 @@ export class DomRepeat extends domRepeatBase {
     // until ready, since won't have its template content handed back to
     // it until then
     if (!this.__ctor) {
-      let template = this.template =  this._templateInfo ? this : /** @type {HTMLTemplateElement} */(this.querySelector('template'));
+      // When `removeNestedTemplates` is true, the "template" is the element
+      // itself, which has been given a `_templateInfo` property
+      let template = this.template = this._templateInfo ? this :
+        /** @type {HTMLTemplateElement} */(this.querySelector('template'));
       if (!template) {
         // // Wait until childList changes and template should be there by then
         let observer = new MutationObserver(() => {
diff --git a/lib/mixins/property-effects.js b/lib/mixins/property-effects.js
index 802586e9..bec51d4c 100644
--- a/lib/mixins/property-effects.js
+++ b/lib/mixins/property-effects.js
@@ -19,9 +19,7 @@ import { camelToDashCase, dashToCamelCase } from '../utils/case-map.js';
 import { PropertyAccessors } from './property-accessors.js';
 /* for annotated effects */
 import { TemplateStamp } from './template-stamp.js';
-import { sanitizeDOMValue, legacyUndefined, legacyNoBatch, legacyNotifyOrder, orderedComputed } from '../utils/settings.js';
-
-const btp = window.location.search.match(/btp/);
+import { sanitizeDOMValue, legacyUndefined, legacyNoBatch, legacyNotifyOrder, orderedComputed, removeNestedTemplates, fastDomIf } from '../utils/settings.js';
 
 // Monotonically increasing unique ID used for de-duping effects triggered
 // from multiple properties in the same turn
@@ -1974,11 +1972,23 @@ export const PropertyEffects = dedupingMixin(superClass => {
       if (this[TYPES.PROPAGATE]) {
         runEffects(this, this[TYPES.PROPAGATE], changedProps, oldProps, hasPaths);
       }
-      let templateInfo = this.__templateInfo;
-      while (templateInfo) {
+      if (this.__templateInfo) {
+        this._runEffectsForTemplate(this.__templateInfo, changedProps, oldProps, hasPaths);
+      }
+    }
+
+    _runEffectsForTemplate(templateInfo, changedProps, oldProps, hasPaths) {
+      const baseRunEffects = () => {
         runEffects(this, templateInfo.propertyEffects, changedProps, oldProps,
           hasPaths, templateInfo.nodeList);
-        templateInfo = templateInfo.nextTemplateInfo;
+        for (let info=templateInfo.firstChild; info; info=info.nextSibling) {
+          this._runEffectsForTemplate(info, changedProps, oldProps, hasPaths);
+        }
+      };
+      if (templateInfo.runEffects) {
+        templateInfo.runEffects(baseRunEffects);
+      } else {
+        baseRunEffects();
       }
     }
 
@@ -2684,14 +2694,23 @@ export const PropertyEffects = dedupingMixin(superClass => {
         // and link into list of templates if necessary
         templateInfo = /** @type {!TemplateInfo} */(Object.create(templateInfo));
         templateInfo.wasPreBound = wasPreBound;
-        if (!wasPreBound && this.__templateInfo) {
-          let last = this.__templateInfoLast || this.__templateInfo;
-          this.__templateInfoLast = last.nextTemplateInfo = templateInfo;
-          templateInfo.previousTemplateInfo = last;
-          return templateInfo;
+        if (wasPreBound || !this.__templateInfo) {
+          this.__templateInfo = templateInfo;
+        } else {
+          const parent = templateInfo.parent || this.__templateInfo;
+          const previous = parent.lastChild;
+          parent.lastChild = templateInfo;
+          templateInfo.previousSibling = previous;
+          if (previous) {
+            previous.nextSibling = templateInfo;
+          } else {
+            parent.firstChild = templateInfo;
+          }
         }
+      } else {
+        this.__templateInfo = templateInfo;
       }
-      return this.__templateInfo = templateInfo;
+      return templateInfo;
     }
 
     /**
@@ -2736,13 +2755,13 @@ export const PropertyEffects = dedupingMixin(superClass => {
      * @override
      * @protected
      */
-    _stampTemplate(template) {
+    _stampTemplate(template, templateInfo) {
+      templateInfo =  templateInfo || /** @type {!TemplateInfo} */(this._bindTemplate(template, true));
       // Ensures that created dom is `_enqueueClient`'d to this element so
       // that it can be flushed on next call to `_flushProperties`
       hostStack.beginHosting(this);
-      let dom = super._stampTemplate(template);
+      let dom = super._stampTemplate(template, templateInfo);
       hostStack.endHosting(this);
-      let templateInfo = /** @type {!TemplateInfo} */(this._bindTemplate(template, true));
       // Add template-instance-specific data to instanced templateInfo
       templateInfo.nodeList = dom.nodeList;
       // Capture child nodes to allow unstamping of non-prototypical templates
@@ -2757,8 +2776,7 @@ export const PropertyEffects = dedupingMixin(superClass => {
       setupBindings(this, templateInfo);
       // Flush properties into template nodes if already booted
       if (this.__dataReady) {
-        runEffects(this, templateInfo.propertyEffects, this.__data, null,
-          false, templateInfo.nodeList);
+        this._runEffectsForTemplate(templateInfo, this.__data, null, false);
       }
       return dom;
     }
@@ -2776,23 +2794,22 @@ export const PropertyEffects = dedupingMixin(superClass => {
     _removeBoundDom(dom) {
       // Unlink template info
       let templateInfo = dom.templateInfo;
-      if (templateInfo.previousTemplateInfo) {
-        templateInfo.previousTemplateInfo.nextTemplateInfo =
-          templateInfo.nextTemplateInfo;
+      const {previousSibling, nextSibling, parent} = templateInfo;
+      if (previousSibling) {
+        previousSibling.nextSibling = nextSibling;
+      } else if (parent) {
+        parent.firstChild = nextSibling;
       }
-      if (templateInfo.nextTemplateInfo) {
-        templateInfo.nextTemplateInfo.previousTemplateInfo =
-          templateInfo.previousTemplateInfo;
+      if (nextSibling) {
+        nextSibling.previousSibling = previousSibling;
+      } else if (parent) {
+        parent.lastChild = previousSibling;
       }
-      if (this.__templateInfoLast == templateInfo) {
-        this.__templateInfoLast = templateInfo.previousTemplateInfo;
-      }
-      templateInfo.previousTemplateInfo = templateInfo.nextTemplateInfo = null;
       // Remove stamped nodes
       let nodes = templateInfo.childNodes;
       for (let i=0; i<nodes.length; i++) {
         let node = nodes[i];
-        node.parentNode.removeChild(node);
+        wrap(wrap(node).parentNode).removeChild(node);
       }
     }
 
@@ -2923,18 +2940,33 @@ export const PropertyEffects = dedupingMixin(superClass => {
         this, node, templateInfo, nodeInfo);
       const parent = node.parentNode;
       const nestedTemplateInfo = nodeInfo.templateInfo;
-      if (btp && parent.localName.match(/(dom-repeat|dom-if)/)) {
+      const isDomIf = parent.localName === 'dom-if';
+      const isDomRepeat = parent.localName === 'dom-repeat';
+      // Remove nested template and redirect its host bindings & templateInfo
+      // onto the parent (dom-if/repeat element)'s nodeInfo
+      if (removeNestedTemplates && (isDomIf || isDomRepeat)) {
         parent.removeChild(node);
         nodeInfo.parentInfo.templateInfo = nestedTemplateInfo;
         nodeInfo = nodeInfo.parentInfo;
+        nodeInfo.noted = true;
         noted = false;
       }
       // Merge host props into outer template and add bindings
       let hostProps = nestedTemplateInfo.hostProps;
-      let mode = '{';
-      for (let source in hostProps) {
-        let parts = [{ mode, source, dependencies: [source], hostProp: true }];
-        addBinding(this, templateInfo, nodeInfo, 'property', '_host_' + source, parts);
+      if (fastDomIf && isDomIf) {
+        if (hostProps) {
+          if (!removeNestedTemplates) {
+            nodeInfo.parentInfo.noted = true;
+          }
+          templateInfo.hostProps = 
+            Object.assign(nestedTemplateInfo.hostProps || {}, hostProps);
+        }
+      } else {
+        let mode = '{';
+        for (let source in hostProps) {
+          let parts = [{ mode, source, dependencies: [source], hostProp: true }];
+          addBinding(this, templateInfo, nodeInfo, 'property', '_host_' + source, parts);
+        }
       }
       return noted;
     }
diff --git a/lib/mixins/template-stamp.js b/lib/mixins/template-stamp.js
index eb439af5..3f8cfe21 100644
--- a/lib/mixins/template-stamp.js
+++ b/lib/mixins/template-stamp.js
@@ -72,9 +72,11 @@ function applyEventListener(inst, node, nodeInfo) {
 }
 
 // push configuration references at configure time
-function applyTemplateContent(inst, node, nodeInfo) {
+function applyTemplateContent(inst, node, nodeInfo, parentTemplateInfo) {
   if (nodeInfo.templateInfo) {
-    node._templateInfo = nodeInfo.templateInfo;
+    // Give the node an instance of this templateInfo and set its parent
+    node._templateInfo = Object.create(nodeInfo.templateInfo);
+    node._templateInfo.parent = parentTemplateInfo;
   }
 }
 
@@ -255,7 +257,7 @@ export const TemplateStamp = dedupingMixin(
       if (element.hasAttributes && element.hasAttributes()) {
         noted = this._parseTemplateNodeAttributes(element, templateInfo, nodeInfo) || noted;
       }
-      return noted;
+      return noted || nodeInfo.noted;
     }
 
     /**
@@ -437,13 +439,13 @@ export const TemplateStamp = dedupingMixin(
      * @return {!StampedTemplate} Cloned template content
      * @override
      */
-    _stampTemplate(template) {
+    _stampTemplate(template, templateInfo) {
       // Polyfill support: bootstrap the template if it has not already been
       if (template && !template.content &&
           window.HTMLTemplateElement && HTMLTemplateElement.decorate) {
         HTMLTemplateElement.decorate(template);
       }
-      let templateInfo = this.constructor._parseTemplate(template);
+      templateInfo = templateInfo || this.constructor._parseTemplate(template);
       let nodeInfo = templateInfo.nodeInfoList;
       let content = templateInfo.content || template.content;
       let dom = /** @type {DocumentFragment} */ (document.importNode(content, true));
@@ -454,7 +456,7 @@ export const TemplateStamp = dedupingMixin(
       for (let i=0, l=nodeInfo.length, info; (i<l) && (info=nodeInfo[i]); i++) {
         let node = nodes[i] = findTemplateNode(dom, info);
         applyIdToMap(this, dom.$, node, info);
-        applyTemplateContent(this, node, info);
+        applyTemplateContent(this, node, info, templateInfo);
         applyEventListener(this, node, info);
       }
       dom = /** @type {!StampedTemplate} */(dom); // eslint-disable-line no-self-assign
diff --git a/lib/utils/settings.js b/lib/utils/settings.js
index bc81c7bd..13eae5c0 100644
--- a/lib/utils/settings.js
+++ b/lib/utils/settings.js
@@ -263,3 +263,43 @@ export let cancelSyntheticClickEvents = true;
 export const setCancelSyntheticClickEvents = function(useCancelSyntheticClickEvents) {
   cancelSyntheticClickEvents = useCancelSyntheticClickEvents;
 };
+
+/**
+ * Setting to remove nested templates inside `dom-if` and `dom-repeat` as
+ * part of element template parsing.  This is a performance optimization that
+ * eliminates most of the tax of needing two elements due to the loss of 
+ * type-extended templates as a result of the V1 specification changes.
+ */
+export let removeNestedTemplates = true;
+
+/**
+ * Sets `removeNestedTemplates` globally, to eliminate nested templates
+ * inside `dom-if` and `dom-repeat` as part of template parsing.
+ *
+ * @param {boolean} useCemoveNestedTemplates enable or disable removing nested
+ *   templates during parsing
+ * @return {void}
+ */
+export const setRemoveNestedTemplates = function(useCemoveNestedTemplates) {
+  removeNestedTemplates = useCemoveNestedTemplates;
+};
+
+/**
+ * Setting to place `dom-if` elements in a performance-optimized mode that takes
+ * advantage of lighter-weight host runtime template stamping to eliminate the
+ * need for an intermediate Templatizer `TemplateInstance` to mange the nodes
+ * stamped by `dom-if`.  Under this setting, any Templatizer-provided API's
+ * such as `modelForElement` will not be available for nodes stamped by
+ * `dom-if`.
+ */
+export let fastDomIf = true;
+
+/**
+ * Sets `fastDomIf` globally, to put `dom-if` in a performance-optimized mode.
+ *
+ * @param {boolean} useFastDomIf enable or disable `dom-if` fast-mode
+ * @return {void}
+ */
+export const setFastDomIf = function(useFastDomIf) {
+  fastDomIf = useFastDomIf;
+};
diff --git a/lib/utils/templatize.js b/lib/utils/templatize.js
index e4f5ba42..ba4eb3e0 100644
--- a/lib/utils/templatize.js
+++ b/lib/utils/templatize.js
@@ -103,6 +103,48 @@ function upgradeTemplate(template, constructor) {
  */
 const templateInstanceBase = PropertyEffects(class {});
 
+export function showHideChildren(hide, children) {
+  for (let i=0; i<children.length; i++) {
+    let n = children[i];
+    // Ignore non-changes
+    if (Boolean(hide) != Boolean(n.__hideTemplateChildren__)) {
+      // clear and restore text
+      if (n.nodeType === Node.TEXT_NODE) {
+        if (hide) {
+          n.__polymerTextContent__ = n.textContent;
+          n.textContent = '';
+        } else {
+          n.textContent = n.__polymerTextContent__;
+        }
+      // remove and replace slot
+      } else if (n.localName === 'slot') {
+        if (hide) {
+          n.__polymerReplaced__ = document.createComment('hidden-slot');
+          wrap(wrap(n).parentNode).replaceChild(n.__polymerReplaced__, n);
+        } else {
+          const replace = n.__polymerReplaced__;
+          if (replace) {
+            wrap(wrap(replace).parentNode).replaceChild(n, replace);
+          }
+        }
+      }
+      // hide and show nodes
+      else if (n.style) {
+        if (hide) {
+          n.__polymerDisplay__ = n.style.display;
+          n.style.display = 'none';
+        } else {
+          n.style.display = n.__polymerDisplay__;
+        }
+      }
+    }
+    n.__hideTemplateChildren__ = hide;
+    if (n._showHideChildren) {
+      n._showHideChildren(hide);
+    }
+  }
+}
+
 /**
  * @polymer
  * @customElement
@@ -206,45 +248,7 @@ class TemplateInstanceBase extends templateInstanceBase {
    * @protected
    */
   _showHideChildren(hide) {
-    let c = this.children;
-    for (let i=0; i<c.length; i++) {
-      let n = c[i];
-      // Ignore non-changes
-      if (Boolean(hide) != Boolean(n.__hideTemplateChildren__)) {
-        if (n.nodeType === Node.TEXT_NODE) {
-          if (hide) {
-            n.__polymerTextContent__ = n.textContent;
-            n.textContent = '';
-          } else {
-            n.textContent = n.__polymerTextContent__;
-          }
-        // remove and replace slot
-        } else if (n.localName === 'slot') {
-          if (hide) {
-            n.__polymerReplaced__ = document.createComment('hidden-slot');
-            wrap(wrap(n).parentNode).replaceChild(n.__polymerReplaced__, n);
-          } else {
-            const replace = n.__polymerReplaced__;
-            if (replace) {
-              wrap(wrap(replace).parentNode).replaceChild(n, replace);
-            }
-          }
-        }
-
-        else if (n.style) {
-          if (hide) {
-            n.__polymerDisplay__ = n.style.display;
-            n.style.display = 'none';
-          } else {
-            n.style.display = n.__polymerDisplay__;
-          }
-        }
-      }
-      n.__hideTemplateChildren__ = hide;
-      if (n._showHideChildren) {
-        n._showHideChildren(hide);
-      }
-    }
+    showHideChildren(hide, this.children);
   }
   /**
    * Overrides default property-effects implementation to intercept
@@ -365,10 +369,14 @@ function createTemplatizerClass(template, templateInfo, options) {
  * 
  * @suppress {missingProperties} class.prototype is not defined for some reason
  */
-function addPropagateEffects(template, templateInfo, options, methodHost) {
+function addPropagateEffects(target, templateInfo, options, methodHost) {
   let userForwardHostProp = options.forwardHostProp;
   if (userForwardHostProp && templateInfo.hasHostProps) {
-    const isTemplate = template.localName == 'template';
+    // Under the `removeNestedTemplates` optimization, a custom element like
+    // `dom-if` or `dom-repeat` can itself be treated as the "template"; this
+    // flag is used to switch between upgrading a `<template>` to be a property
+    // effects client vs. adding the effects directly to the custom element
+    const isTemplate = target.localName == 'template';
     // Provide data API and property effects on memoized template class
     let klass = templateInfo.templatizeTemplateClass;
     if (!klass) {
@@ -382,7 +390,9 @@ function addPropagateEffects(template, templateInfo, options, methodHost) {
         klass = templateInfo.templatizeTemplateClass =
           class TemplatizedTemplate extends templatizedBase {};
       } else {
-        klass = class TemplatizedTemplateExtension extends template.constructor {};
+        // Create a cached subclass of the base custom element class onto which
+        // to put the template-specific propagate effects
+        klass = class TemplatizedTemplateExtension extends target.constructor {};
       }
       // Add template - >instances effects
       // and host <- template effects
@@ -398,21 +408,31 @@ function addPropagateEffects(template, templateInfo, options, methodHost) {
       }
     }
     if (isTemplate) {
-      upgradeTemplate(template, klass);
+      upgradeTemplate(target, klass);
       // Clear any pending data for performance
-      template.__dataTemp = {};
-      template.__dataPending = null;
-      template.__dataOld = null;
-      template._enableProperties();
+      target.__dataTemp = {};
+      target.__dataPending = null;
+      target.__dataOld = null;
+      target._enableProperties();
     } else {
-      Object.setPrototypeOf(template, klass.prototype);
+      // Swizzle the cached subclass prototype onto the custom element
+      Object.setPrototypeOf(target, klass.prototype);
+      const hostProps = templateInfo.hostProps;
+      for (let prop in hostProps) {
+        prop = '_host_' + prop;
+        if (prop in target) {
+          const val = target[prop];
+          delete target[prop];
+          target.__data[prop] = val;
+        }
+      }
     }
     // Mix any pre-bound data into __data; no need to flush this to
     // instances since they pull from the template at instance-time
-    if (template.__dataProto) {
+    if (target.__dataProto) {
       // Note, generally `__dataProto` could be chained, but it's guaranteed
       // to not be since this is a vanilla template we just added effects to
-      Object.assign(template.__data, template.__dataProto);
+      Object.assign(target.__data, target.__dataProto);
     }
   }
 }
@@ -632,7 +652,7 @@ export function modelForElement(template, node) {
     // An element with a __templatizeInstance marks the top boundary
     // of a scope; walk up until we find one, and then ensure that
     // its __dataHost matches `this`, meaning this dom-repeat stamped it
-    if ((model = node.__templatizeInstance)) {
+    if ((model = node.__dataHost ? node : node.__templatizeInstance)) {
       // Found an element stamped by another template; keep walking up
       // from its __dataHost
       if (model.__dataHost != template) {
diff --git a/test/runner.html b/test/runner.html
index ddbb05a4..f6975ce7 100644
--- a/test/runner.html
+++ b/test/runner.html
@@ -71,7 +71,11 @@ subject to an additional IP rights grant found at http://polymer.github.io/PATEN
       'unit/path.html',
       'unit/templatize.html',
       'unit/dom-repeat.html',
+      'unit/dom-repeat.html?removeNestedTemplates=true',
       'unit/dom-if.html',
+      'unit/dom-if.html?removeNestedTemplates=true',
+      'unit/dom-if.html?fastDomIf=true',
+      'unit/dom-if.html?removeNestedTemplates=true&fastDomIf=true',
       'unit/dom-bind.html',
       'unit/array-selector.html',
       'unit/polymer-dom.html',
diff --git a/test/unit/dom-if.html b/test/unit/dom-if.html
index bdb1935b..8e45135e 100644
--- a/test/unit/dom-if.html
+++ b/test/unit/dom-if.html
@@ -14,6 +14,11 @@ subject to an additional IP rights grant found at http://polymer.github.io/PATEN
   <script src="../../node_modules/@webcomponents/webcomponentsjs/webcomponents-bundle.js"></script>
   <script src="wct-browser-config.js"></script>
   <script src="../../node_modules/wct-browser-legacy/browser.js"></script>
+  <script type="module">
+    import { setRemoveNestedTemplates, setFastDomIf } from '../../lib/utils/settings.js';
+    setRemoveNestedTemplates(location.search.match(/removeNestedTemplates/));
+    setFastDomIf(location.search.match(/fastDomIf/));
+  </script>
   <script type="module" src="../../polymer-legacy.js"></script>
   <script type="module" src="./dom-if-elements.js"></script>
 </head>
diff --git a/test/unit/dom-repeat-elements.js b/test/unit/dom-repeat-elements.js
index 8b836da5..bc10f972 100644
--- a/test/unit/dom-repeat-elements.js
+++ b/test/unit/dom-repeat-elements.js
@@ -464,9 +464,9 @@ Polymer({
 Polymer({
   _template: html`
     <template is="dom-repeat" items="{{items}}" id="outer">
-      <template is="dom-if" if="">
+      <template is="dom-if" if="" name="outerIf">
         <template is="dom-repeat" items="{{item.items}}" id="inner">
-          <template is="dom-if" if="">
+          <template is="dom-if" if="" name="innerIf">
             <button on-click="handleClick">{{item.prop}}</button>
           </template>
         </template>
diff --git a/test/unit/dom-repeat.html b/test/unit/dom-repeat.html
index 1a8d10f9..5788df62 100644
--- a/test/unit/dom-repeat.html
+++ b/test/unit/dom-repeat.html
@@ -14,6 +14,10 @@ subject to an additional IP rights grant found at http://polymer.github.io/PATEN
   <script src="../../node_modules/@webcomponents/webcomponentsjs/webcomponents-bundle.js"></script>
   <script src="wct-browser-config.js"></script>
   <script src="../../node_modules/wct-browser-legacy/browser.js"></script>
+  <script type="module">
+    import { setRemoveNestedTemplates } from '../../lib/utils/settings.js';
+    setRemoveNestedTemplates(location.search.match(/removeNestedTemplates/));
+  </script>
   <script type="module" src="../../polymer-legacy.js"></script>
   <script type="module" src="./dom-repeat-elements.js"></script>
   <style>
@@ -108,7 +112,6 @@ subject to an additional IP rights grant found at http://polymer.github.io/PATEN
     </dom-repeat>
   </div>
 
-
   <test-fixture id="primitiveLarge">
     <template>
       <x-primitive-large></x-primitive-large>