Buyers are becoming more educated on the process of purchasing energy efficient homes. Beyond the curb appeal, decisions on upgrading your home for sale should include a review of your energy usage. In the previous article on purchasing an energy rating home in this series, we covered the Energy Efficiency Mortgage (EEM) and how that can help a potential buyer qualify for a larger loan. In the case of FHA and VA loans there are even tax advantages to purchasing an energy efficient home.
As the seller of a home, you may consider having an energy audit of your home by a certified Home Energy Rater so you know in advance where the home falls on the HERS index. The index is used by mortgage lenders to determine qualification for an EEM. A HERS index less than 85 is a good number to shoot for when selling an existing home in Ohio. That is a home that uses 15% less energy than the reference home established point of 100. For more information on the HERS index and the EEM see the article on How to Buy a Green Home.
Buyers are looking at greener homes in their purchasing decisions. Better Homes and Gardens released the results of its “Next Home Survey”. Nearly 48% of the 2,300 potential home buyers questioned said that greener buildings will be more important when they purchase their next home. Buyers will be looking at both the green materials and the practices of the builders as noted in the survey.
So the government is taking action. The Energy Task Force in the Obama administration is looking at a national mandatory rating system. The system may depend on the number of certified HERS raters to support an infrastructure for the mandate.
Legislation that is intended to employ a large number of the 17 percent construction workers out of work is the Home Star initiative, currently in draft form at the Federal level. The idea is to provide tax incentives for home owners to upgrade their homes with energy saving insulation and home sealing. For this purpose it has been dubbed the name “Cash for Caulkers” after the popular “Cash for Clunkers” program that provided a jump start for auto sales.
Introduced into the cap-and-trade bill was a requirement for home sellers to provide an energy audit to the buyer and the seller would be required to repair any deficiencies before the sale would be approved. Governments are attempting to set up a system for controlling greenhouse gas emissions, and cap-and-trade is a proposal for taxing inefficient use of energy.
Local laws are also changing. In 2008 Santa Fe, TX began requiring that new homes post a confirmed HERS index. Effective January 1 of this year, Montgomery County, MD is requiring an energy audit along with an inspection when selling a home.
The state of Oregon will be taking it a step further if legislation passes in its climate change agenda for 2009. The proposed language requires that home owners selling or renting will be required to post a certificate showing energy use and greenhouse gas emmissions. The law will also extend to commercial buildings by 2012.
Legislation is coming, be thinking now of providing an energy efficient home before listing your home for sale.
This is a three-part series on ways to save money by investing in energy efficient home improvements. Review the ways to save money by investing in home improvements in these three areas.
- Home Energy Series, Part I: Controlling Costs, Save $
- Home Energy Series, Part II: Buy an Energy Home
- Home Energy Series, Part III: Sell a Green Home