Article by Andrew Shepard
Published May 6, 2011
With the downturn in the housing market that has resulted in a new economic environment in the building industry, many builders and developers are looking for creative solutions to weather the storm. This has resulted in builders using a number of different strategies, including focusing on the remodel market, building at the lowest cost possible, building green or high-performance homes, or just getting out of the industry all together.
Transparency brings about successful home sales
Arguably, one of the most interesting approaches builders have used to differentiate themselves is transparency – they seek to let the consumers know exactly what they are buying. They have adopted green building certifications and energy performance scores as tools to achieve this more transparent message. By bringing progressive construction details into the foreground, builders are creating entirely new buying criteria that the residential market has not seen before. Many of America’s leading builders — for example, KB homes – have changed the paradigm and are making this case to their buyers every day, citing specific features that improve energy efficiency, durability, and health. All of these benefits should be important to consumers today.
The cost-per-square-foot paradigm is a rabbit hole that unfortunately lures many builders and buyers. Like almost every manufactured good there are inexpensive options to accomplish seemingly similar results. Building homes is no different. With every decision a builder makes there are cheap, affordable, sensible, premium, expensive and excessive buying options. The trick to building an affordable, marketable home is making the correct decisions at each step of the building process.
The concept of building “high-performance” homes coupled with providing transparency for the buyer pulls the curtain back on this process, allowing the buyer to see what’s behind the walls of the most significant investment they will potentially ever make. When most buyers are on a budget, then location, cost-per-square-foot, stainless steel, and granite become the easiest metrics to measure value. However, providing transparency to buyers is increasingly proving that the value of a home is truly more than the superficial cosmetics. (http://www.ideal-homes.com/innovation.php)
Building high-performance homes is as much about process as it is about products.
By process and techniques alone, a home’s efficiency can be improved by as much as 20 to 30 percent beyond than what typical construction may yield. Energy modeling can produce reports that demonstrate the efficiency that has been built into the new home through the utilization of unnoticeable techniques. Many builders shy away from such techniques due to the perception that they cost more or because they don’t want to manage the learning curve in educating key subcontractors. However, many leading builders have shown that once subcontractors have been properly trained and high performance techniques become standard practice, the excuse dissolves. The result is a better trained work force, subcontractors who are more engaged, and a better built home.
You can’t manage what you don’t measure; moreover, inspect what you expect
Some buyers would be surprised to know that the quality and performance of their newly constructed, standard-built home was never inspected or tested. Leading builders are exploiting this fact by allowing their homes to be third-party inspected and verified, with the results being made available to the buyer. Green certification and energy performance scoring are easy-to-understand, collective examples of these results. Savvy consumers will shop around to find the greatest value in their home purchase. Builders promoting green certification and energy scoring have an upper hand in providing consumers with real, in-depth and cutting-edge information than can offer a true comparison point against other homes on the market.
Instant information access means builders must know their value proposition
In the era of the Internet, defining a “good deal” and describing value has now become a more sophisticated proposition. Buyers are more educated than ever and the builders who are responding to this are finding success. These, new-age, savvy customers are learning the right questions to ask, and with PDAs and Smart phones they will verify the answers in a matter of seconds. Because of this, realtors and brokers must be armed with accurate and convincing sales tools to communicate the quality and efficiency of a home. Green certification and energy performance scores are the tools that builders and realtors need. It is also becoming more important than ever that realtors and brokers can speak to, and understand, some of these construction details and attributes. Training programs such as Eco-Broker or Earth Advantage Sustainability Training for Accredited Real Estate Professionals (STAR) are providing realtors and brokers with the knowledge needed to address these issues with buyers.
This phenomenon is not just a local Oregon trend, but is being realized by leading builders all over the country. The criteria for a Portland, Maine home may be very different than from a home in Phoenix, Arizona, or from one here in Portland, Oregon. However, the priorities of the buyers potentially are very much the same: location, value, comfort, healthy, durability and efficiency. With an integrated approach to selling homes, green certification and energy efficiency are important pieces in the selling proposition.
More industries, corporations and businesses, are implementing triple bottom line policy. This refers to prioritizing business practices around three basic elements; People, Planet, and Profit. Consumers who work for such organizations are going to bring these priorities with them when making major purchases. Builders utilizing green certification and energy performance scores are prepared to meet the needs of these well paid, intelligent and savvy customers.
So, what’s the energy performance of your home? If you don’t know; what else don’t you know about your home?
About the Author
Andrew Shepard is a Green Building Consultant with Earth Advantage Institute and a Builder Outreach Specialist with the Energy Trust of Oregon New Homes Program and the Northwest ENERGY STAR New Homes Program. Currently Andrew is involved with new residential construction, Earth Advantage’s Sustainable Training for Accredited Realty Professionals program (S.T.A.R.), and involved with the USGBC’s LEED for Homes program. Andrew sat on the committee that developed the Sustainable Communities standard, and was involved with drafting the 2009 Earth Advantage Silver Program. He has completed training with Earth Advantage, ENERGY STAR, the Oregon Department of Energy, is a certified Verifier for the Northwest ENERGY STAR New Homes program and has completed training for the LEED-H program.