Water Cooler Talk
There are a million factors that homebuyers look at before purchasing a new home. What makes Real Estate such a unique market is that each buyer and seller have unique qualities that they are looking for. There are countless third party websites that estimate the value of a home. If you ask any real estate professional; however, they will tell you that 99% of the time those estimates are way off. Real estate websites overvalue quantitative information and often highlight only one metric: competing sales in the surrounding area. What’s lost are some of the most important qualities to home buyers: the home’s style, functionality, and need for improvements. Increasingly, homebuyers are considering another metric in the value of a home: energy efficiency.
Unfortunately, the energy efficiency of a home can be difficult to assess. A home uses energy in a variety of ways, all of which can be heavily effected by the behavior of its residents. That’s why home energy audits exist–to help homeowners understand the health, safety, comfort, and energy consumption of their dwelling. The results of home energy audits and efficiency work can be quantified for many homeowners through their utility bills. For home buyers and sellers, energy efficient improvements are a smart and quantifiable way to help your home’s value catch up with the inflated values on the world wide web.
The homeowners we’ve worked with bear witness to the value of those improvements. Here’s a quote from a homeowner we recently completed work for:
“My BGE bill went from $165 per month in a 1600 sq ft home to (wait for it…) $82 a month!”
A reduction of $80 a month can be a significant reduction in a homebuyer’s monthly bills. Compounded monthly over a 30-year mortgage, a new purchaser of this home would save $36,343 at a 1.5% inflation rate. Clearly, there’s a lot of value in home energy efficiency.
The Real Estate industry is taking notice. Consider the following facts and figures:
Homes that have energy efficient improvements can gain a higher value for the upgrades in an official appraisal.
The Appraisal Institute has a specific certification program that instructs appraisers on how to recognize and valuate GREEN features siting it as a “specialized topic” that should be valued accurately.
The National Association of Realtors has encouraged the use of and developed a GREEN MLS Implementation Guide to help multi-listing service companies implement GREEN fields and search criteria in the MLS siting that “the demand for GREEN is growing.”
The National Association of Realtors has a GREEN Designation that educates realtors specifically on consulting, marketing, and selling GREEN homes.
New home builders must build all homes to a certain energy standard and many new home builders opt to specialize in Energy Star and LEED building.
Mortgage lenders offer energy efficient mortgages so that homeowners in existing homes can make energy efficiency improvements which help them compete in the housing market.
Multi-listing services like, Metropolitan Regional Information Systems, Inc., track trends in home buying and consumer wants and expectations on energy efficiency. Andrew Strauch, Vice President of Product Innovation and Marketing stated that “With higher energy costs and an overall concern for the environment, more homebuyers increasingly factor in environmental efficiency when searching for a new home.”
Utility companies are part of the movement to reduce energy consumption in Maryland and offer discounts and rebates to homeowners that take advantage of energy efficient improvements to their homes.
We’ve made our case for being educated in green real estate talk so what’s next? Use the programs that the State, County, City, and utility companies have put in place to make the improvements that will create a more sustainable lifestyle for you.