Local case studies confirm price premium for green homes identified in recent statewide study
July 19, 2012 LOS ANGELES--Coming on the heels of a statewide study by researchers from the University of California, Berkeley and the University of California, Los Angeles three in-depth case studies of local Los Angeles County homes confirmed that green upgrades increase the value of a home by up to 9 percent. The case studies, funded by Energy Upgrade California in Los Angeles County and the Green Label Rebate Program, provide local support for the statewide findings that homes with green features sell at a higher price.
"Most importantly, I can now reduce my carbon footprint."
To find the added value of green home upgrades, an independent appraiser evaluated three Los Angeles County homes before and after they received green and energy upgrades and the GreenPoint Rated label. The GreenPoint Rated label represents the gold standard in green home construction and remodels and verifies that a home was built or remodeled to meet high environmental standards. Following the green upgrade and labeling, the appraised value of the homes was found to have increased by 5.5 to 9 percent.
"Green upgrades aren't usually tracked as home features on real estate listing services, which makes it challenging for appraisers to determine the monetary value of the upgrades," said Debra Little, the appraiser who directed the study. "We used methodologies beyond the typical appraisal scope, taking into account the energy efficiency benefits as well as factors such as healthier indoor air quality and sealing air leaks ó a construction technique that improves the durability and effective life of a home. We ultimately determined that the many benefits of green homes do lead to higher home values in the local market."
Highlights of the three case studies include:
The Kienzle House, Whittier, CA
*Increase in appraised value after green upgrades: 6 percent
*Home value before green upgrades: $720,000
*Home value after green upgrades: $765,000
*GreenPoint Rated score: 30 points (exceeded the minimum 25 points)
*Reduction in energy costs: $2,237 per year
*Upgrades included: Insulation and air sealing of attic and walls, shower valves, pool pump upgrade, weather stripping
"Saving money is a top priority for almost every American family – but this home makeover has done so much more," said Colleen Kienzle. "My main concern was the air quality in our home, because my middle son has severe asthma, so any type of dirt that comes in through the air conditioning is a big issue. After the upgrades, we've noticed a significant reduction of his asthmatic symptoms, which we are very excited about."
The Brown House, Los Angeles, CA
*Increase in appraised value after green upgrades: 5.5 percent
*Home value before green upgrades: $475,000
*Home value after green upgrades: $500,000
*GreenPoint Rated score: 37 points (exceeded the minimum 25 points)
*Reduction in energy costs: $1,600 per year
*Upgrades included: Insulation and air sealing of attic, crawl space and walls; heating and air conditioning system with duct enhancements; solar panels; pool pump upgrade; water heater upgrade; shower valves
"I was excited to upgrade my house because the potential for savings was great, coupled with the fact that upgrades will make my house more comfortable," said Lisa Brown. "Most importantly, I can now reduce my carbon footprint."
The Gerardo House, San Fernando, CA
*Increase in appraised value after green upgrades: 9 percent
*Home value before green upgrades: $420,000
*Home value after green upgrades: $460,000
*GreenPoint Rated score: 45 points (exceeded the minimum 25 points)
*Reduction in energy costs: $1,963 per year
*Upgrades included: Insulation and air sealing of attic, crawl space and walls; heating and air conditioning system with duct enhancements; roof repair; pool pump upgrade; solar panels
"We have always wanted to make energy upgrades," said Albert Gerardo. "Our energy costs are now relatively low because we often no longer need to turn on the heat and air conditioning. We're very excited because we now have a more energy efficient home, and we will have a role in helping our environment."
Local residents who wish to green their homes can now earn up to $2,000 in rebates for a green label for their home and $8,000 in rebates for energy and green upgrades through Energy Upgrade California in Los Angeles County. Homeowners can learn more about green upgrades and getting a green label for their home at www.energyupgradegreenlabel.org.
"We're helping homeowners make their homes more comfortable and increase their property value," said Howard Choy, general manager for Los Angeles County's Office of Sustainability, one of several statewide partners in the Energy Upgrade California program, and sponsor of the Green Label Rebate Program. "We hope this information and the energy upgrade rebates available to Los Angeles County homeowners will encourage more people to acquire energy efficiency upgrades and green home labels."
Little will publish a white paper detailing the case study findings later this year.
Media, please note: To request interviews with Debra Little and the homeowners, or for more information about the case studies, please contact Jessica Lee at email@example.com or 415-875-3043.
Related research: Statewide study finds significant price premium for green-labeled homes in California
The statewide study, "The Value of Green Labels in the California Housing Market," found that a green home label adds an average 9 percent price premium. The study is the first rigorous, large-scale independent economic analysis of the value of green home labels in California and was led by researchers Nils Kok, visiting professor at the University of California, Berkeley and Matthew Kahn, professor at the Institute of the Environment, Department of Public Policy and Department of Economics at the University of California, Los Angeles.
About Energy Upgrade California in Los Angeles County and the Green Label Rebate Program
Energy Upgrade California in Los Angeles County is administered and overseen by an alliance among L.A. County, Southern California Edison, and Southern California Gas Company. Los Angeles County was one of the first counties in California to roll out this program to provide homeowners with information on home upgrade benefits, financing, incentives and home energy ratings and help with finding participating contractors. Learn more about Energy Upgrade California and the Green Label Rebate Program at EnergyUpgradeGreenLabel.org.