Escrow Trust Advisors | Studies Show Energy-Efficient Homes Pay Off
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Studies Show Energy-Efficient Homes Pay Off

Studies Show Energy-Efficient Homes Pay Off

Energy-efficiency ratings have started finding their way into listings for residential properties.  A recent survey conducted by The Earth Advantage Institute, a non-profit group in Portland, OR, found that Energy Star or LEED (Leadership in Energy and Environmental Design) certifications increase the sale price of a home.  EAI states that new homes certified for sustainability and energy efficiency sell for 8% more, on average, than their non-certified counterparts.  The news is better for existing construction, where the same certification can add a premium of about 30% to the home.

In response to the trend, new training programs are finding their way into the banking and appraisal industries.  The institutions have found it necessary to teach officers how to acknowledge the benefits of energy efficient designs and how to translate them into lending and appraisal practices.  Banks are starting to realize that, when a borrower pays less for heating and electricity in an energy-efficient home, their ability to pay (and thus, credit-worthiness) increases, making them less risk for the underwriting bank.

Sales price isn’t the only place energy efficiency pays.  In the Portland, OR, market, a recent review of listings showed that energy-efficient homes spent 18 days less than comparable non-certified properties on the real estate market.