Colorado's #1 Rated Appraisal Company

Colorado’s #1 Rated Appraisal Company

— From the Colorado Governors Energy Office:

Market penetration of efficient ENERGY STAR New Homes continues impressive climb; Colorado recognized by the American Council for an Energy-Efficient Economy as one of top five states with exceptional state-led energy efficiency program.

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Nearly 45% of new homes built in Colorado in the first half of 2010 were ENERGY STAR qualified, according to new information released by the Governor’s Energy Office (GEO) and the Environmental Protection Agency (EPA). This data is the latest to show how homebuilders and home buyers in the state continue to realize the advantages associated with homes designed and built to earn the ENERGY STAR label.

When Governor Bill Ritter’s Energy Office initiated the ENERGY STAR New Homes program in 2007, market penetration of ENERGY STAR New Homes started at just under 8 percent. That level increased to 19.4 percent in 2008 and reached nearly 33 percent last year, making the market for new homes that lower energy bills an important part of the New Energy Economy.

“The success of ENERGY STAR New Homes program shows how, once again, the New Energy Economy is a bright spot even in difficult economic times,” said GEO director Tom Plant. “These homes are saving Coloradans money, reducing pollution, increasing our energy security and strengthening the market for energy-smart construction.”

The work of GEO and its partners in building the ENERGY STAR New Homes marketplace won honors again this week. The latest recognition came from the American Council for an Energy-Efficient Economy (ACEEE), which named Colorado’s ENERGY STAR New Homes program one of the five “exceptional state-led energy efficiency programs” in the country.

“Simply put, energy efficiency works. These state programs benefit customers in numerous ways, generating significant energy savings, training thousands of professionals, lowering energy costs and reducing the negative environmental impacts of energy use,” said ACEEE executive director Steve Nadel. “Many featured programs demonstrate collaboration between public and private stakeholders, serving as models for effectively coordinated and highly-leveraged programs that can last for years to come.”

“Energy efficiency efforts are thriving at the state level in ways that most people may not be aware of today. The program winners demonstrate how state governments can implement successful, cost-effective energy efficiency programs aimed at a variety of customer types,” said David Terry, executive director for the National Association of State Energy Offices.

The success of Colorado’s ENERGY STAR New Homes program also received recognition from the U.S. Environmental Protection Agency in 2009 and again in 2010, when it honored the program with the ENERGY STAR Partner of the Year Award. The GEO credits the hard work of more than 130 community partners – including local governments, non-profits, utilities, real estate professionals, homebuilders and home energy raters for the honor. To learn more about Colorado’s ENERGY STAR New Homes program visit www.coloradoenergystarhomes.com

–End of excerpt from GEO

Many times, homeowners, lenders, developers, etc., wish to understand if their “green feature”, or green certification has any affect on value. Director of Colorado Appraisal Consultants, and Certified General Appraiser, Cody Gale, answers this question in the following way “Does updating your bathroom add value to your house?”. He continues, “Green property improvements are similar to other property improvements, in that, in some fashion, they enhance some aspect of the building or house. Whether it has to do with energy efficiency, occupant comfort, landscaping, etc., the corresponding market perception of that feature must be contemplated within the scope of the assignment including the specific market and property type. As an appraiser, lumping an Energy Star or LEED home into one “green” category can get you into trouble, as they have varying enhancements, some that add to value more than others.”

This is why the selection of an appriaser with in-depth green building knowledge is especially critical in today’s current lending environment. “I’ve seen people make the mistake, whether it’s because they truly don’t know, or just are not probing enough, of lumping green into the same overarching category and making conclusions based on data-sets that effectively compare apples to mangos. Does this impact value? You bet.”

In addition to his Masters Degree from the University of Denver in Real Estate Finance & Construction Management, Mr. Gale holds his LEED AP designation and serves on the Executive Commercial Real Estate Committee on the Market Research Team.

Even within one Green Building Certification scheme, such as LEED, it is constantly evolving such that seldom times, no two LEED buildings have the same green features even if they are next door to each other. Just look at LEED NC (New Construction)- From years 2008 to 2009, LEED NC underwent its scheduled update which happens every three years. In addition to a complete reweighting of all LEED points, the major categories of Energy Performance and Water Efficiency increased their baseline standards substantially.

“Just in the WE (Water Efficiency) category alone, the baseline for water efficiency measurements changed from being based on the Energy Policy Act of 1992, to the Energy Policy Act of 2005, including 2006 UPC standards. On top of that, a 20% water reduction is now a prerequisite to LEED NC version 3, as opposed to be optional in LEED NC v2.2. This change inevitably effects the cost to build, what level of Certification can be achieved, and most importantly, the performance of the building “.

From a value standpoint, these changes will likely require further data segregation, as a LEED NC v3 building is now “superior” to a LEED NC v2.2 building. These changes will remain a constant struggle for appriasers, as the lag in data will inevitibly be an obstacle.

Colorado Appraisal Consultants is proud to offer Green Property Valuation to serve the unique needs of appraising this type of property.  To date, there is no “official” standard for valuing these types of buildings or houses, making it even more important to select an appraiser who understands what affect various ‘green’ features may have on Market Value.

Disclaimer: Thanks for reading. As always, this is not advise, consultation, or research based material. Rather, blogged opinions.

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