Sunday, April 29, 2012

Going Green Sells Homes and More


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The sale of existing homes and buildings faces stiff competition from new construction builders who, in competing with foreclosures, are now using cutting edge, healthy, ecofriendly technology and code compliance to differentiate themselves. These builders pay close attention to surveys and trends, and existing home sellers and property owners will also want to follow suit.

An increasing number of new buildings are built to meet the EPA's Energy Star Program, USGBC's LEED certifications, HERS Home Energy Rating System, NAHB's Green Building Program, and regional programs such as Build It Green, Built Green, EarthCraft House, Earth Advantage and others. On January 1, 2011 the new California Green Building Code, goes into affect, which requires all new construction to include specific healthy, eco-friendly alternatives.

Along with this competition from new construction, buyer requests for "green" and healthy features in a home is growing. Nearly 50 percent of American adults said that their New Year's resolution for 2010 was to go green, and even more said they are going to strive to reduce their household energy usage this year, according to a new survey by Move.com. In Green Outlook 2009: Trends Driving Change, McGraw-Hill Construction found that 70% of homebuyers said they were more inclined to buy a green home in a down economy than a non-green home. More buyers are looking to not only curtail high utility bills, but also save the planet and their health. With the rising cost of medical expenses it's only logical that there is money to be saved by using healthy materials inside a building.

Featuring a home's green assets creates an attractive selling point in today's market, and many real estate professionals are getting specialized training. The National Association of Realtors has created the NAR GREEN designation, and the Association of Energy and Environmental Real Estate Professionals (AEEREP) has the Eco Broker Green Designation. These organizations and others collaborated in the creation of the Green MLS Tool Kit ( ) aimed at showing local MLSs how to add a green initiative. The Southern California MLS form includes an extensive list of "green" features.

In the May 2009 Certified Home Performance study, conducted by the Earth Advantage Institute and with the assistance of brokers, appraisers, and university professors, it was found there is a sale price premium and marketing time advantage for homes that have a third-party green certification. The study's abstract says: "certified homes in the Seattle metro area sold at a price premium of 9.6% when compared to non-certified counterparts, based on a sample of 68 certified homes. In the Portland metro area, certified homes sold at a price premium ranging between 3% and 5%. In addition, the certified homes stayed on the market for 18 days less than non-certified homes." Other statistics in Atlanta during 2009 show certified green homes sold 3.6% closer to list price and were on the market 31 days less than conventional new construction (108 vs.139 days).

The economics make sense for rental properties as well. A Study by the Institute of Business and Economic Research in April 2008 shows higher rent and occupancy rates for "green" office buildings throughout the U.S. Also of concern for property owners is the affect of indoor air quality on occupants' health. Buildings with poor indoor air quality due to molds, toxins, radon and electromagnetic fields can create unexpected expenses. Not only will correcting these issues bring higher rents and occupancy rates, but remediation will be far less costly than litigation from occupants.

As long ago as November 17, 2008, Daily Real Estate News published results from a Better Homes and Gardens Real Estate survey. The survey said bout 48 percent of home owners would spend $2,500 or more to green up their homes for resale. One-third say they would be willing to spend $5,000 or more on green improvements to make their homes more appealing. So, property owners, it's not just a passing fad. The movement is on. Be sure to include "green" eco healthy features in your property.

Copyright 2010 Cynthia Grier. All rights reserved.

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