Green Homes and Sales Trends

Posted by: Howard Sobel on October 19th, 2009

Green is the New Black

The housing industry hasn’t developed a reliable way of breaking down green versus conventional homes sales figures. But its clearly a hot button issue and will even become more important, perhaps mandatory, as we begin to seriously deal with global warming.

green-home-sale-trendsWhat Others are Saying….

“Those builders are seeing that they’ll get more buyers coming to their developments when they have solar. They sell like hot cakes,” Bernadette del Chiaro, an energy specialist at the advocacy group Environment California, told the Los Angeles Times. The Times also quoted Julie Blumden, a vice president at San Jose-based solar tile maker SunPower Corp., as pointing out that the increase in sales velocity is actually paying for the solar systems.

At least one MLS listing service is updating its database to allow for property searches based on a range of green features.

National Association of Realtors®
According to a recent NAR survey, 90 percent of recent home buyers thought energy efficiency was a very important consideration when searching for a home, and the demand for green buildings and environmentally sensitive home features is growing.

Arbor National Mortgage & American Forests notes that 83% of Realtors believe that mature trees have a ‘strong or moderate impact’ on the saleability of homes listed for under $150,000; on homes over $250,000, this perception increases to 98%. This survey is supported by observations from the USDA Forest Service: mature trees add an average of 10 percent to a property’s value.

Ris Media
Way back in 2007, Ris Media reported that the market for true green homes is expected to rise from $2 billion to up to $20 billion over the next five years. Green homeowners are happy with their homes because they are concerned about the health of their families, as well as energy savings and operating costs. Homeowners are buying green homes.

National Association of Home Builders
According to the National Association of Home Builders, the green homes market is expected to increase to 10 percent by 2010. The NAHB hits a new milestone this month, it just green certified its 500th home builder project.

Green Tools You Can Use

Congress may require all appraisers to consider energy efficient improvements in appraisals. Appraisal standards would be uniformly revised to include all energy efficient improvements, typically including double paned windows, extra insulation and solar hot water heaters. Congress is hoping to incentivize owners to upgrade to energy efficient homes and to standardize the formulations used by appraisers to measure the green impact on home equity.

EEM Mortgages
Buy more house. Fannie Mae, Freddie Mac, FHA, and VA all permit borrowers to qualify for larger mortgages using projected energy savings. Every home with retrofitted energy-efficient (EPA approved energy star rated) features is eligible. Green mortgage products may also include low down payments effectively increasing buying power. Details vary, but generally lenders require a professional auditor to certify the energy efficient improvements before buyers can qualify for mortgage breaks.

Get Audited
A seller with a good energy audit is a plus. Sellers can call their local utility company for an energy audit. The audit includes the furnace, the water heater, and major appliances, windows, insulation and the heat seal in general. There is a small cost of about $100, but good results are a good marketing tool.

A poor audit can be also be a good support tool for the selling agent. An independent third party recommendation to upgrade can be a powerful argument towards convincing sellers to invest in sale process.

Tenants are demanding it.

Green on the Cheap

Tenants show a preference for green buildings, because of the health benefits and monthly savings. Inexpensive energy efficient upgrades offer improvements in operating costs and savings to the tenant, all for very little outlay. Given the choice of being a good eco citizen and lower bills, tenants are opting for rentals that have green upgrades. Following are some inexpensive ways to green a home for sale or a unit for rent.

PG&E (California Public Utility) reports the following savings:

Energy Conservation

  1. Programmable Thermostats: At a cost to the owner of $35-$100, you can boost of saving a tenant up to $160 a year. In times like these, with rentals down and vacancies up, this can be an attractive incentive for a prospective
  2. Caulk, re insulate and weatherize for a more complete energy seal. Generally considered the least expensive way to reduce energy costs.
  3. Energy efficient light bulbs for common areas: Many utilities are providing them at cost.
  4. Double Pane Windows can save $120 annually.

Water Conservation
Low Flow Devices:

  1. Faucet Aireators: Placed in the kitchen and bathrooms, it can save as much as 8700 gallons annually, per unit.
  2. Low Flow Shower Heads: Can reduce water use by as much as 8700 gallons annually per unit.
  3. Low flow Toilets: These devices can save as much as 15,000-20,000 gallons annually.

If two homes are similar in character and price and one is green…. the choice is obvious, Green feels good, green is good and green offers a competitive advantage.

Howard Sobel
Your Property Path News Brief



5 Comments on “Green Homes and Sales Trends”

Luxury homes for sale

Really great post. Energy conservation and water conservation are now really important to improve our live quality!!!

really informative, thanks a lot.

Canada Guy

Where are the real green homes? Today’s homes, even when designed to be “green” are much larger than earlier homes and have a much smaller household. Even with efficiency improvements, they are much more wasteful and generate more emissions than the smaller homes of the 50s.

Justin E. Fogle

I am not sure of this blog posting. I was really hoping for hard numbers on sales trends. Sadly, I found the article more about greenwashing projects.

If you are planning on updating this article, please list the MLS that is adding green features and what they are. I know that the NW MLS now has Green Building Certifications under the checklist (sadly they are not available to the consumer unless going through a realtor, i.e. you can not do an internet search at this time to find them). At this time, there are over 80 building certification systems nationally, are there trends with those buildings? I would love to know if someone is tracking them and if they are selling faster than ones without certification.

BTW, What is your take on Green Building Certification Systems? If so, what is the preferred one for clients in your area?

JB Stearns

Great information. Thanks for sharing it with us.


I wanted to comment on Justins regarding hard numbers. When I researched this I was also disappointed. No one is yet tracking green home sales numbers.
When big orgs like NAR and HomeGain cant yet offer hard numbers its because the tracking mechanisms are not yet in place.

If anyone has found hard numbers please share with us…

Thanks for Reading


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