Making the Invisible Visible: Valuing Energy Efficiency Improvements in a Real Estate Transaction

Often, when homeowners make improvements to an existing house, the most important aspects of home performance – including safety, comfort, energy efficiency, durability, and environmental impact – are literally invisible during key steps of any home sale or refinance transaction.

One result is that energy efficiency investments are overlooked or inaccurately valued at the time of a home sale. The key to making these investments visible to everyone involved in a home sale – including appraisers, Realtors®, buyers, and sellers – is standardized documentation and consistent communication across the energy efficiency and real estate industries.

new paper from CNT Energy and National Home Performance Council shows how proper documentation, verification, and standardization of energy efficiency improvements can add value to a home that owners can recoup at sale.

The paper provides a blueprint and outlines seven steps the energy efficiency industry must take to unlock the value of efficiency in the real estate market:

Unlocking the Value of an Energy Efficient Home

  1. Consistently document energy efficiency improvements
  2. Ensure data is incorporated into the appraisal process
  3. Work with the real estate community to reflect these improvements in local for-sale listings
  4. Capitalize on existing education and training opportunities
  5. Report on the growing inventories of energy efficient homes
  6. Develop standardized IT solutions
  7. Work with partner financial institutions

The outcome is that energy efficient features become visible and can be accurately valued when a home is sold. This lays the groundwork for a virtuous cycle in which homeowners are eager to invest in energy efficiency improvements because they know that they can recover some or all of their investments at the time of the home sale.

The full paper is available online at  www.cntenergy.org/media/Unlocking_Value_2013.pdf

Those interested in learning more are invited to participate in a webinar on Wednesday, October 2,  at 11 a.m. CDT. Details and registration are available at www.cntenergy.org/events/.

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Tags: Realtor, appraiser, efficiency, energy, estate, home, improvement, real, sale, transaction, More…use, value

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Comment by Glen Gallo on September 16, 2013 at 5:17pm

Excellent read thanks for sharing

Comment by Joseph Lamy on September 3, 2013 at 12:35pm

The negawatt...watta concept..an unholy un-grail, ..from wiki..

"Roughly 10% of all U.S. electrical generating capacity is in place to meet the last 1% of demand and there is where the immediate efficiency opportunity exists.

On March 15, 2011, the Federal Energy Regulatory Commission (FERC), the agency that regulates the U.S. electrical grid, approved a rule establishing the approach to compensation for demand response resources intended to benefit customers and help improve the operation and competitiveness of organized wholesale energy markets. This means that negawatts produced by reducing electrical use can demand the same market prices as real megawatts of generated electricity

How the whole-house captain and solarPV carport net zeroed the house and rode the Golden Chariot into the sunset magazine

Comment by tedkidd on August 29, 2013 at 8:36am

Until we can see MPG for homes and compare to MPG of other homes, it will be a complex argument.  People tend to dismiss or deeply discount complex arguments of value.

We need to take this: http://bit.ly/gainsvillegreen and turn the data into a present value argument of the negawatt, the value of the better MPG.  

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