With a current zeitgeist around environmental protections and sustainability, more homeowners than ever are focused on green design and eco-friendly features. Add in the benefit of energy and water savings and it’s easy to see why green homes are in high demand. But all is not equal with sustainable architecture from one area of the country to another. As a report sponsored by Payless Power shows, there’s a wide variation in the value of a green home, meaning if the goal is to benefit the environment and your pocketbook you may want to consider the location of your new abode.
The study reached conclusions about the value of green homes by evaluating features on over 70,000 homes listed on Redfin from different regions around the country. Researchers also interviewed more than 1,000 people from a range of age groups.
Payless Power then compiled the information and found some interesting results about the values of green homes versus non-green homes. For the purpose of this study, green features are defined as properties with LEED/Energy Star certification, solar panels or other eco-friendly elements.
The increased value of green homes
According to the report, green design elements increase the value of a home an average of 41% compared to non-green homes. The study evaluates this value increase for homes in different cities. Their findings put Detroit, MI, at the top of the list where green homes boast an impressive 180% higher value than traditional homes. Next on the list was Chicago, IL where the average home price runs around $556,000 and the sales of green homes in the same area averages an elevated $1,535,000 (176%). Montgomery and Birmingham, both in Alabama, took the third and fourth spots while Philadelphia snagged the fifth position.
Other areas with over 100% of increase of value due to features such as passive design, renewable energy, rainwater harvesting systems and LED lighting include St. Petersburg, FL, Raleigh, NC and Cape Coral, FL. At the bottom of the to 20 list, San Diego, CA offers a 65% increase in value for green features, but with traditional home prices averaging $1,165,000, the increased amount of $1,922,000 may be unattainable for most.
These findings suggest that homeowners seeking to make eco-friendly upgrades may witness substantial returns on their investments in certain locations. Moreover, cities with lower home values for eco-friendly features offer opportunities for buyers to find green homes at a more affordable price point compared to conventional housing.
Green home prices across the country
When it comes to homes on the market that are considered green, the Payless Power study highlights areas with high availability and compares the average price of those properties to energy-efficient homes in other regions. Atlanta, Georgia, stands out as the city with the highest percentage of green homes for sale, with 87% of all listed properties featuring eco-friendly elements. However, despite this high prevalence, green homes in Atlanta have an average price of around $588,600, making them more accessible than other expensive cities.
The top three cities commanding the highest green home prices are San Francisco, CA (nearly $2.5 million on average), Scottsdale, AZ (nearly $2.2 million), and Boston, MA (over $1.6 million). On the other hand, cities like Detroit, MI (under $322,000), Yukon, OK (just over $340,000) and El Paso, TX (just over $362,000) offer more affordable access to the benefits of green homes. Other locations in the top 10 for cities where green homes are less expensive include several Texas locations like San Antonio, Corpus Christi, and Fort Worth. Also on the list is Montgomery and Birmingham, AL, Clarksville, TN and Yonkers, NY.
The draw of green homes to different generations
Environmental consideration is foremost in the minds of young home buyers. In fact, millennials and Gen Zers were 27% more likely than baby boomers to buy a green home.
The study delved into the preferences of different generations concerning green homes. It revealed that a significant number of respondents expressed a desire to have eco-friendly features in their homes. The most sought-after green home features included energy-efficient appliances (54%), LEED/Energy Star certification or solar panels (49%), LED lighting (46%), energy-conserving insulation (46%) and smart energy-monitoring technology (33%), indicating a growing trend among younger homebuyers.
Advantages of going green
In addition to the increased property value of green homes, buyers are making an investment in lower monthly bills. With the most desired green home features being those that monitor or reduce energy consumption, prospective buyers have strong incentives to invest in environmentally sustainable properties.
Whether you’re buying, selling, or looking to reduce energy costs, investing in a green home can be a smart and environmentally responsible decision. The benefits of green home features go beyond financial gains, providing homeowners with the satisfaction of contributing to a greener and more sustainable future.
Via Payless Power
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