New Appraisal Guide Helps Boost Green Home Valuations

Home builders and buyers know they’ll have to pony up extra cash for an energy-efficient home. But such an investment can show inconsistent returns when it comes time for the appraisal.

According to the U.S. Department of Energy, homes built to the 2012 or 2015 International Energy Conservation Code (IECC) are 15-16% more efficient than those built to the 2009 IECC or earlier. It only makes sense those homes should have a higher value.
Fannie Mae, Freddie Mac and FHA guidelines already require appraisers to consider the energy efficient features of the home, and if the market supports an adjustment in the appraised value, one must be made. But an average appraiser won’t take this into account if they aren’t made aware.
To address this variation across the industry, NAHB recently collaborated with the Building Codes Assistance Project (BCAP) and Appraisal Institute (AI) to create a guide for home builders, buyers and lenders for the valuation of homes built to today’s stricter energy codes. They can also be used as informational pieces in understanding the importance of hiring a proficient “green” appraiser and where to find them.
The guide, Appraised Value & Energy Efficiency: Getting It Right, provides important... Read the story


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