Residential Labeling Where Are We Now? Title Style. Joan Glickman Home Energy Score Program Administrator September 11, 2016

Transcription

1 Residential Labeling Where Are We Now? Click What s To on Edit the Master Horizon? Title Style Joan Glickman Home Energy Score Program Administrator September 11, 2016

2 Where Are We? Tremendous interest in ratings at least among efficiency advocates Growing recognition that market transformative approaches are needed 2 Lots of Opportunities Training Financing Policy Public Information And much more Traditional programs & incentives will NOT get us to where we need to be in terms of energy or carbon reductions Can be difficult deciding where to focus Lots of Different Players Utilities Home Inspectors Contractors REALTORS Lenders Multiple Listing Services Appraisers Retailers Manufacturers Buyers, Sellers, Current Owners

3 Why Do Homeowners & Buyers Care About Energy Efficiency? U.S. Census: Energy costs are higher than property tax & insurance for average U.S. homes NARI Report: Energy improvements are good investments that bring financial relief and joy 3 Insulation Upgrade: 61% say greater desire to be home, 95% same or increased sense of enjoyment, and 66% major sense of accomplishment HVAC Replacement: 57% say greater desire to be home, 59% say increased sense of enjoyment, 55% major sense of accomplishment $3,000 $2,500 $2,000 $1,500 $1,000 $500 $0 Average U.S. Homeowner Costs: 2012 (US Census) $2,506 $2,082 $1,023 Energy Property Tax Homeowner's Insurance Sources: National Association of Insurance Commissioners, 2012, Annual Homeowners Insurance Report; National Association of REALTORS and the National Association of the Remodeling Industry (NARI), 2015

4 Studies Nationwide Show Energy Efficient Homes Sell for More, Faster Certified homes sell for 9.6% more 6 Certified homes sell for 4.2% more & 18 days faster 6 Certified homes sell for 2.1 to 5.3% more 9 Homes that disclose energy costs sold 20 days faster 5 Natural gas homes command $11 more per square foot 11 Homes that use green fields consistently perform better on market indicators 8 PACE homes delivered$199 to $8,882 above cost of improvements 7 ENERGY STAR homes sold at $5,566 premium at $2.99 per ft 2 more, & 89 days faster 10 Homes designated relatively energy efficient sold for an average $3,416 premium 4 Houses with one or more green element sell for 5.9% more 2 New certified homes sold for 12.9% more,$13.82 per ft 2 more, & 42 days faster 1 Certified homes sold for a higher percentage of their asking price & 31 days faster 2 4 Sources: 1 Argeris, 2010; 2 Cadena & Thomson, 2015; 3 Carson Matthews, 2009; 4 Corgel, Goebel, & Wade, 1982; 5 Elevate Energy, 2015; 6 Griffin, 2009; 7 Goodman & Zhu, 2016; 8 Institute for Market Transformation, 2015; 9 Kahn & Kok, 2013; 10 Pfleger et al., 2011; 11 Springer, 2015.

5 The Research Says: Homebuyers Value Energy Efficiency Studies Show a Sales Premium of: 2% to 12.9% for designated energy efficient homes 1, 2, 3. 7, 12 $2.99 to $13.82 per square foot for every dollar saved on annual electricity bills from efficiency investments 1, 5, 10, 15 $3,416 to $8,882 for designated energy efficient homes 4, 8, 9, 12, 13, 14, 15 VS. Designated energy efficient Comparable home 5 Sources: 1 Argeris, 2010; 2 Cadena & Thomson, 2015; 3 Carson Matthews, 2009; 4 Corgel, Goebel, & Wade, 1982; 5 Dinan & Miranowski, 1989; 6 Elevate Energy, 2015; 7 Griffin, 2009; 8 Goodman & Zhu, 2016; 9 Halvorsen & Pollakowski 1981; 10 Horowitz & Haeri, 1990; 11 Institute for Market Transformation, 2015; 12 Kahn & Kok, 2013; 13 Laquatra, 1986; 14 Longstreth, 1986; 15 Pfleger et al., 2011.

6 The Research Says: Homebuyers Value Energy Efficiency Studies Show a Sales Premium of: 2% to 12.9% for designated energy efficient homes 1, 2, 3. 7, 12 $2.99 to $13.82 per square foot for every dollar saved on annual electricity bills from efficiency investments 1, 5, 10, 15 $3,416 to $8,882 for designated energy efficient homes 4, 8, 9, 12, 13, 14, 15 VS. Designated energy efficient Comparable home 6 Sources: 1 Argeris, 2010; 2 Cadena & Thomson, 2015; 3 Carson Matthews, 2009; 4 Corgel, Goebel, & Wade, 1982; 5 Dinan & Miranowski, 1989; 6 Elevate Energy, 2015; 7 Griffin, 2009; 8 Goodman & Zhu, 2016; 9 Halvorsen & Pollakowski 1981; 10 Horowitz & Haeri, 1990; 11 Institute for Market Transformation, 2015; 12 Kahn & Kok, 2013; 13 Laquatra, 1986; 14 Longstreth, 1986; 15 Pfleger et al., 2011.

7 More Evidence from Around the World From 2016 ACEEE Summer Study Paper: Predicting Home Energy Rating and Disclosure Program Impacts for North American Jurisdictions Alex J Hill, Dunsky Energy Consulting Lead Author 2013 study of nine EU jurisdictions Found between 2% and 6% appreciation in home value attributed to one-letter rating improvement Assessments of Home Energy Rating & Disclosure on Conversion Rates Jurisdiction Portion of Buyers Influenced by Rating/Disclosure Report Recommendations When Making Renovations Austin, TX 12% (first year of program) (ACEEE 2011) Australia (ACT) 15% (Energy Consult 2006) France 37% (ADEME 2012) Portugal 17.5% (ADENE 2015) 7 The Netherlands 22% (Murphy 2014)

8 8 So How Do We Get This Info Into the Hands of Home Buyers & Others Who Can Use It?

9 Home Energy Information Accelerator 1 Expand Pipeline Vision of widespread use of reliable home energy information in real estate transactions, enabling fair value at time of sale for energy efficient and high performing homes Develop Tools & Systems Demonstrate Use Recognize Champions Success Metric: Expand availability and use of reliable home energy information to demonstrate replicable models of automated, linked systems influencing home sales 9

10 The Home Energy Information Accelerator Partners National Partners Five Pilot Locations Appraisal Institute CoreLogic Council of Multiple Listing Services Green Button Alliance Homes.com Home Innovation Research Labs Home Performance Coalition National Association of Realtors Center for Realtor Technology National Association of State Energy Officials PicketFence.com Real Estate Standards Organization Realtors Property Resource LLC U.S. Green Building Council California Build it Green, CRMLS Chicago Metro Elevate Energy; Illinois Department of Commerce & Economic Opportunity, MRED Colorado Colorado Energy Office, IRES Northeast/VT - Northeast Energy Efficiency Partnerships, Vermont Energy Investment Corporation Oregon - Earth Advantage, Oregon Department of Energy, Enhabit

11 Building the Pipeline of Ratings: Growing Activity by State and Local Governments The following use Home Energy Score Other cities and states exploring residential energy labeling policies: Portland, OR; Fort Collins, CO; Rhode Island; New York; Massachusetts

12 3D Sim Training & Testing Opened the Market Free online Assessor training & test 350+ Active Assessors 12 Home Inspectors ramping up

13 Home Energy Score Highlights 45,000+ homes scored since 2012 Growing uptake: Last 12 months, on average 1,500 homes scored/month 7 software tools now using our API; others expected soon New semi-customizable label No need to enter data in two places v.2016 Scoring Tool will include PV

14 Building Effective Information Infrastructure Real Estate Standards Organization: Called on MLSs to Adopt Standard Green Fields by January 2018 REColorado (Denver, CO) Aspen Glenwood (CO) Cincinnati (OH) MLSs that Currently Feature Home Energy Score MRIS (DC, VA, MD) NEREN (VT, NH) & Others! 14

15 Financing Options for Energy Efficiency Improvements Finance up to 15% of as completed home value for energy improvements $500 incentive to lender on each loan Pay off existing energy improvement debt (including PACE) Requires a Home Energy Score, HERS report, or comparable locally-supported report 15 Finance up to $3,500 in weatherization or water-efficient improvements with no energy report Source: Fannie Mae HomeStyle Energy Mortgage Loan Real Estate Fact Sheet

16 Additional Loan Opportunities FHA s stretch policy Allows borrowers to qualify for a 2% stretch on debt-to-income ratios for homes that score a 6 or higher, or for improving less efficient homes to that threshold Aligned with Fannie Mae s HomeStyle Energy policy Property Assessed Clean Energy (PACE) $2.2 billion financed in California for energy efficiency, renewable energy, and water efficiency Other states looking to adopt Home Energy Score can be used to identify cost-effective measures, provide an objective estimate of savings, and document value after improvements are completed State & Local Loan and Financing Options 16 Obama Administration Announces Clean Energy Savings for All Americans Initiative, 2016

17 Making Sure Efficiency Information Makes Sense -- When & Where It Counts Opportunity to Harmonize Ratings Use Common Calculation Engine Generate Common Metrics Estimated Utility Costs Other Allow Comparison of New & Existing Homes

18 Resources Informing This Presentation Cadena, Anjelita, & Thomson, Thomas A. (2015). An Empirical Assessment of the Value of Green in Residential Real Estate. Capturing Energy Efficiency in Residential Real Estate Transactions: Steps that Energy Efficiency Programs Can Take Crawford, Jeremy. (2016). Home Energy Efficiency Information: Coming to Your MLS by Fannie Mae HomeStyle Energy Mortgage Loan Real Estate Fact Sheet Goodman, Laurie S., & Zhu, Jun. (2016). PACE Loans: Does Sale Value Reflect Improvements? Hill, Alex J., et al. (2016). Predicting Home Energy Rating and Disclosure Program Impacts for North American Jurisdictions. ACEEE Summer Study on Energy Efficiency in Buildings. Home Energy Score for Real Estate Fact Sheet Institute for Market Transformation (IMT). (2015). Greening the MLS: Bringing High-Performance Homes to Light in the District of Columbia. Kahn, Matthew E., Kok, Nils. (2013). The capitalization of green labels in the California housing market. Regional Science and Urban Economics. National Association of REALTORS 2015 Remodeling Impact Report Pfleger, W., Perry C., Hurst, N., Tiller, J. (2011). Market Impacts of ENERGY STAR Qualification for New Homes. U.S. Green Building Council [USGBC]. (2014). LEED in Motion: Residential. Unlocking the Value of an Energy Efficient Home: A Blueprint to Make Energy Efficiency Improvements Visible in the Real Estate Market White House, FACT SHEET: Obama Administration Announces Clean Energy Savings for All Americans Initiative. 18

19 Thank You! 19

20 20 Additional Slides/Back-Up

21 Home Energy Score 21

22 Partner Network

23 Partner Requirements Partners oversee Assessors to implement Home Energy Score Upon Joining Sign a partnership agreement Develop an implementation plan Annual Commitment Complete 500+ Scores per year Rescore 5% of homes (Quality Assurance) On-going Participate in Partner webinars Receive data for all homes scored in your area

24 Partner Highlights State & Local Efforts Utilities City of Berkeley, CA: Requires Home Energy Score prior to home sale through its Building Energy Saving Ordinance. Colorado Energy Office: Statewide program focused on real estate integration. Homes scored through home inspectors and utilities. Realtor outreach/education. Missouri Statewide Home Energy Certificate: Gold certificate for Score of 8 or higher. Silver certificate for homes that make majority of recommended improvements. United Illuminating and Eversource w/ Connecticut Department of Energy & Environmental Protection: Two utilities implementing on behalf of the state through statewide Home Performance with Energy Star program. New Jersey Natural Gas: Homes scored after install of high-efficiency furnace/boiler/water heater to drive additional EE measures. Columbia Water & Light (MO): Integrated into Home Performance program, homes scored before & after improvements. Focus on Energy (WI): Initially planned with a direct install program and now plans to integrate into Home Performance program.

25 2015 Training and Testing Opened the Market to More Assessors (e.g. Home Inspectors) This 3-D Tool developed with significant input from outside experts & practitioners. Uses computer-based simulations to recreate a range of job-site scenarios. DOE conducted in-classroom/in-the-field validation study Confirmed effectiveness of simulation tool in determining a candidate s competency to deliver the Home Energy Score. DOE now recognizes certifications from many different building-related organizations. As a result Many more building professionals are now be able to offer the Score.

26 Energy Disclosure Can Be A Good Step Chicago Homes that Disclose Energy Costs Spend Less Time on Real Estate Market (Elevate Energy, 2015) Homes that disclose energy costs: median 43 days on market; 66% closing rate Homes that did not disclose: median 63 days on market; 53% closing rate Homebuyers appreciate having more information rather than less; poor ratings don t discourage home purchases This helps them make the most informed decision possible, even if they will need to fix an energy feature of the home Analysis of European disclosure programs shows, ratings do not likely influence home buying decisions in terms of which property to purchase (Hill et al., 2016, p. 11) 26

27 Semi-Customizable Label Now Available