Thanks to Dave and Anna Porter of PorterWorks, our entire staff are now certified GreenValuation Specialists®. This designation involves 14 hours of training on the principles of green construction, along with the considerations involved in valuation and lending for these properties.
We are really pleased that there is now a program available to appraisers, lenders, and agents to become certified. This is an area that has seen little in the way of guidelines and standards; now we have at least some baseline to begin to distinguish trained professionals who have taken the effort to understand the essential features of "high performance" properties.
Quick Turn has been actively campaigning for greater education for appraisers, agents and lenders to become familiar with this growing market segment. Nearly 25 percent of the new construction listed in the Triangle MLS is now certified as energy efficient and/or green, yet many professionals still don't know what that means. Certification requirements, and even the terminology, are not yet understood. This often means that there is seldom any enhanced market information provided about these homes.
Consequently, these professionals have no idea how to value a "High Performance" home. Some (many?) appraisers feel that because there is no perceived value in the market. We believe that this may because there has been no effort to educate buyers, agents, and lenders about energy and operational efficiencies that they can expect from these homes.
The statement is often made that a buyer would not pay more for a high performance home, and that this reflects the market opinion. However, if rephrased as which home would you buy for a given price, green or traditional, everything else being equivalent, we suspect virtually everyone would opt for the green home. In fact, they would demand a discount for the traditional home, indicating that they do perceive a value for green.
Even the most basic EnergyStar certification requires a 15% reduction in the Home Energy Rating System (HERS) score (a measure of energy efficiency, determined by a number of factors - including a "blower door" test for air leakage), compared to a code-built home. This HERS rating of 85 translates roughly to a 15% decrease in energy costs, and qualifies the buyer for additional tax incentives and special reduced utility rates.
We are finding that actual ratings for many homes are 30-40% lower than code-built, and some custom builders commonly have HERS ratings of 50 or lower (using 50% or less of the energy). Yet the potential savings never get considered by many lenders or appraisers, even though they may exceed $100 per month in many cases.
We believe it is now essential that all real estate professionals recognize that green/"high performance" properties have enhanced value. Now that we have certification programs available, it is even more essential that they recognize that enhanced training is required for properly marketing and valuation, and DEMAND that certified professionals perform these functions.
If we fail to demand qualified professionals, any efforts to educate the public about buying more efficient homes will fail, as well. Even willing buyers can be sabotaged by lenders and appraisers who refuse to believe that the market can see what they cannot.