Keen for Green
Homebuyers reveal they love green features, but don’t always want to ante up.
Homebuyers tend to have a strongly favorable opinion of green features….if the impact on price is not mentioned, according to NAHB’s publication What Home Buyers Really Want.
Buyers rated “ENERGY STAR appliances” and “ENERGY STAR rating for the whole home” first and third on a list of 120 home features deemed essential or desirable. Over 70 percent agreed that they would prefer to purchase from a builder who provides energy ratings.
Yet there are limits to buyers’ enthusiasm for green. While 94 percent rated ENERGY STAR appliances as at least desirable, a relatively modest 36 percent said ENERGY STAR appliances were essential (a smaller percentage than for items like ceiling fans, exterior lighting, or a bathroom linen closet). And though over 80 percent of home buyers are concerned about the environment, only 14 percent said they were willing to pay more for an environment-friendly home. Further, when responding to a hypothetical cost-benefit scenario, buyers on average revealed they needed a 14 percent annual rate of return to invest in energy efficiency up front.
Nevertheless, the general favorable impression of green features is clear enough among home buyers that it’s not surprising builders have reacted by including a variety of these features in the homes they build, cost permitting.
What qualifies as a green feature is not always obvious. Typically, industry experts envision something beyond narrowly defined energy efficiency. The list of 23 green questionnaire products and practices is based on the major sections of the National Green Building Standard. The survey asked builders to check one of these products or practices if it was commonly used in homes they built during the past year.
At the top of the list are low-e windows and high-efficiency HVAC systems, each used by roughly 90 percent of builders in the survey, followed by programmable thermostats at 86 percent (Figure 1). It’s perhaps surprising that programmable thermostats aren’t even more common given their low cost, especially when compared to items like windows and HVAC systems. Anecdotally, several builders have reported that a small but discernible share of their customers tend to resist devices that require programming.
After the top three items, ENERGY STAR appliances and duct systems designed to minimize leakage are commonly used by well over 70 percent of builders. In the next tier is a cluster of four building products and practices commonly used by 65 to 67 percent of builders. In addition to improving the home’s thermal envelope, this group includes three items not directly related to the home’s energy performance: moisture control, minimizing material usage, and water-conserving fixtures.
For most of the 23 green products in the survey, usage is relatively uniform across geography (the four principal Census regions) and builder size. (Builders were grouped by those who started fewer than 25, 25 to 99, or more than 100 homes the previous year). For example, at least 86 percent of builders in each region and at least 90 percent in each size category commonly install low-e windows.
The exceptions to this uniformity include a couple of green practices that are more common in the West than in other Census regions. Recycling construction waste, commonly used by 36 percent of builders overall, is commonly used by 64 percent of builders in the West, probably due to state or local recycling requirements or incentives. Passive solar design, commonly used by only 12 percent of builders overall, is commonly used by 24 percent of builders in the West.
Across the list of green items covered in the survey, the use of at least one item is nearly ubiquitous. Ninety-six percent of builders reported using one or more of them. Builders thinking about certifying their homes to the National Green Building Standard, or otherwise expanding their use of green features in order to attract buyers, may find it instructive to see these NAHB survey results on which specific green products and practices their peers have most often found practical and cost-effective.