Keys Homes
Sunday, October 14, 2012
Study: Green label adds value to home

The Associated Press

An article published in The Los Angeles Times shared research that indicated investing in energy-efficient upgrades can lead to increased resale values.

University of California-Berkeley professor Nils Kok led the "Value of Green Labels in the California Housing Market" study with co-researcher Matthew Kahn of UCLA. The article reported the study indicated green improvements added up to 12 percent in value at the time of sale.

According to the article, the researchers analyzed data for 1.6 million single-family homes located in California that were sold between 2007 and 2012. About 4,300 of the homes had green-label certifications. Researchers compared the green-labeled and non-green-labeled homes with similarities in age, size, amenities and location.

The benefit of making a home green-certified appears to outweigh the costs. In addition to increased sale values, owners of green-labeled homes enjoyed annual savings on energy bills equaling an average of about $700. The results of the study also concluded it cost about $10,000 to improve a home's energy efficiency by 35 percent.

To realize the increased values, homeowners are typically required to go through the processes set forth by Energy Star, GreenPoint Rated or LEED for Homes. These organizations oversee programs that certify improvements.

The article noted the research study recorded an increase in certified-home prices more recently than five years ago. Taking into account all other factors, sale prices for green-labeled homes were relatively higher in 2012 than they were in 2007.

Typical enhancements included upgrading to water- and energy-efficient appliances. Homeowners were also found to have made regular improvements as well as adding insulation. It is believed individuals in the market to purchase a new green home value the secondary qualities, like improved air quality, also found in these houses.

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