Thursday, July 5, 2007

Green Building IS Worth It.

I came across a fellow blogger at Lime.com that asked if his green building was worth the effort over conventional building if he is only going to be moving away soon anyway. Of course I had to respond:

I would say it is worth it! And most Realtors would agree with the value of building green. Here is some green market data I gleaned while getting my certification from EcoBroker.
  1. When you build the studio, have a certified Energy Star inspector come out and rate it. Have them rate your home too, while they are there. More than 2000 builders have constructed over 200,000 Energy Star qualified new homes, locking in financial savings for homeowners that exceed $60 million annually. The nations 10 largest homebuilders are now Energy Star partners, and 23 of the top 25 builders offer Energy Star qualified homes. It is something that gets marketed when you sell your home. Even if your home does not qualify, the rating it is given can enable the buyer of your home to qualify for a larger loan to make it more energy efficient before they move in. Government programs have incentives for such things.
  2. Do a quick search for an organization that specializes in green residential buildings in your area. I know Built Green operates near you in Colorado, and Build it Green is my local one in the SF bay area. They might be able to help you with your project, and any certification they offer can be marketed like the Energy Star marketing mentioned above.
  3. Analysis indicates home value increases by about $20 for every $1 reduction in annual utility bills ("More Evidence of Rational Market Values for Home Energy Efficiency" from the Appraisal Journal).
  4. 94% of 300 American consumers surveyed by the Cahners Residential Group in 2001, cited their most sought-after green upgrade as energy savings, followed by water-saving appliances and recycled building materials. In addition, roughly nine in ten (91%) said energy efficient features in a new home are extremely or very important.
  5. In a 2002 nationwide study of more than 400 home buyers conducted by American LIVES, more than half the respondents said they are willing to pay more for formaldehyde-free insulation, environmentally friendly paints, solvent-free andhesives, and other materials that do not release chemicals into the air.
  6. In 2003, with the help of energy efficient technologies, Americans saved over $8 billion on their energy bills while preventing greenhouse gas emissions equivalent to the emissions from 18 million vehicles. These benefits have helped develop a national market for energy efficient products, with more than one billion Energy Star products sold and billions of square feet of building space improved.
  7. The most important environmental issues for consumers are: saving energy, using recycled content building products, improving air quality, and saving old-growth threes.
When you sell your home, my advice would be to market your home's green qualities. Certainly your studio built with green in mind from the ground up is very marketable! There are people willing to pay a premium, and even move from farther away in an effort to find a green home. Make sure your agent markets your home in:

Dwell Green
EcoBroker
Green Real Estate
Green Homes For Sale
Listed Green
and Sustainable Sources

Never price your home higher for any upgrade. Price your home competitively with your neighbors. The lower you price your home, the more people will see it, and bid the price up. This is especially true if they are competing for a green building. You can always reject an offer if no one competes like you expected, and raise the price. However, starting too high and lowering the price as you follow the market down is much more difficult to fix, and makes your home a dud weather you built with straw bale or baby seal fur!

Have fun with your renovation, and rest assured: It is definitely worth it to build it green.

1 comment:

maxmsf said...

That's some good data - thanks G! I've heard different things about the ratio of energy savings to home value, ranging from zero, to 10-1, to 20-1. For better or worse, I have a feeling that people will start putting a premium on the health value of green, maybe moreso than the environmental impact.