Study: ‘Green’ Homes Sell for More, Depending on the Agent
October 16, 2018
Many homeowners may assume that if they retrofit their home with energy-efficient upgrades that they’ll be able to charge a premium at resale. But that’s not always the case nowadays, and the sales price boost may depend on how well the client chose their selling agent, according to recent studies analyzed in a new article by Kenneth Harney, a syndicated real estate columnist.
In the past, studies have confirmed there is a price boost for “green” homes at resale. Some studies of home sales in California and Texas, for example, have shown green-certified homes tend to sell for anywhere from 2.1 percent to 8 percent more than similar homes with minimal or no green features.
But two recent studies by appraisers are calling into question the assumption of a green perk in home sales. The studies suggest that green improvements may help net a slightly higher price, but the premium will greatly depend on several factors, particularly how well versed the real estate selling agent is at selling green home features.
Sandra Adomatis, a real estate appraiser in Florida, found in both studies that having a real estate professional who is trained and knowledgeable at selling green properties is key to getting a price premium for green home features. Adomatis, who headed both research studies, looked at transactions of home sales in the San Francisco Bay area, Virginia, and Maryland, and found that green-certified homes did tend to sell for a premium—even up to 5 percent in some cases—but it depended on the real estate professionals’ marketing. The studies examined price differences in transactions by comparing similar homes, those with significant green features and those without. In some cases, where the properties were not heavily marketed or certified as green—despite having green features—the premiums dropped to 1 percent or lower.
An agent with formal training in the area—such as someone with a GREEN designation, which is also offered by the National Association of REALTORS®—may have a better skill set in knowing how to sell and present such added features. Harney also notes that a real estate professional trained in such ways would know to call out such green details in their local Multiple Listing Service, and for those MLSes that have it include “green fields” in their listings or a “green addendum” to detail the special features that make the home energy efficient.
Updated: January 16, 2019