Existing Homes with a Certification Earn 30% More
Earth Advantage Institute, a nonprofit green building resource, announced the results of its annual certified home analysis in the Portland metropolitan region for the 2010 to 2011 year. The study is part of the organization’s research efforts that include gathering data on green building valuation.
Existing homes with a sustainable certification sold for 30 percent more than homes without such a designation, according to sales data provided by the Portland Regional Multiple Listing Service (RMLS) to Earth Advantage Institute. This finding is based on the sale of existing homes between May 1, 2010 and April 30, 2011 in Multnomah, Clackamas, Columbia, and Washington Counties in Oregon, and Clark County in Washington.
Better sales prices were also seen for newly constructed homes with a sustainability certification. As a group, new homes with a sustainability certification in the six-county Portland metropolitan area sold for 8 percent more than new non-certified homes.
This result continues a four-year trend in which new homes with a third-party certification for sustainable construction and energy performance have consistently sold for more than newly constructed homes that had not been certified. The term “certified home” includes homes that received an Earth Advantage New Homes, ENERGY STAR, or a LEED® for Homes designation, or a combined Earth Advantage/ENERGY STAR certification. Sales information is reported by participating real estate brokers to RMLS. The Portland metropolitan area region includes Multnomah, Clackamas, Columbia, Washington and Yamhill Counties in Oregon and Clark County in Washington. There were no certified new home sales in Columbia and Yamhill Counties that enable comparisons in those areas.
Differences clearly exist among the counties within the metropolitan area. The county exhibiting the greatest difference between new certified and new non-certified homes was Clackamas, where homes with a certification sold for 23.3 percent more than non-certified new homes. Clark County was the one area in the metropolitan region where newly constructed certified homes did not sell for more. However, certified existing homes in Clark County did perform better than their non-certified counterparts. As a group, existing homes with a sustainability certification in Clark County sold for an average of $288,400 versus $222,900 for homes without such a certification, or 29 percent more. Table One summarizes the information received, for both new and existing homes, across the metro region.
|Table One Average Sales Price 2010-2011|
|Clackamas||Columbia||Multnomah||Washington||Yamhill||Clark County WA|
|Non certified||$ 305,647||$ 200,732||$ 292,837||$ 313,040||$239,147||$296,567|
|Non certified||$ 299,696||$174,144||$277,449||$ 259,835||$209,264||$222,918|
|Certified||$ 372,591||$138,000||$448,886||$ 354,245||$315,000||$288,363|
|Source: RMLS Portland May 2011|
Portland RMLS was the first regional multiple listing service in the country to provide sales information for homes with green certification, at the request of Earth Advantage Institute. RMLS began tracking information in 2007.
Two important trends are shown by the four years of sales data. First, the market share of certified homes among all newly constructed homes stayed consistent, with 18 percent of the new homes in the Portland market receiving a sustainability certification. Second, a price premium for certified homes as a group was observed in each year.
Table Two Market Summary May 2007-April 2011
Portland Metro Region
|Number certified new homes||Total New homes sold||Market share certified homes||Price Premium|
|May 1, 2007 to April 30, 2008||833||6125||13.6%||20.5%|
|May 1, 2008 to April 30, 2009||674||4135||16.3%||12.0%|
|May 1, 2009 to April 30, 2010||118||597||19.8%||14.0%|
|May 1, 2010 to April 30, 2011||408||2237||18.2%||18.9%|
“This is important news for builders and home buyers alike,” said Dakota Gale, Sustainable Finance Program Manager, Earth Advantage Institute. “While it must be noted that the data are supplied by real estate agents themselves through standard RMLS forms, and are based on averages, not comparables, we can still see a consistent trend that third-party certification continues to result in a higher sales price, even during the past year when home sales were down.”