“I do think the majority of people see it as a bonus,” Scher says. “We’re not getting a flood of people coming through who want it specifically because it’s eco-friendly.” Instead, “they’re coming to look at it because it’s beautiful, and then there’s the added layer of ‘oh, we can feel good about living in it.’ ”
As a result, home sellers are finding that the premiums they’ve spent on so-called green building best practices don’t necessarily translate into a higher sales price. “We’re seeing it across the board,” not just in eco-conscious materials, Scher says. “Whether it’s the kind of tiles you use, or the quality of windows, or a slate roof versus and asphalt roof, any of those premiums aren’t showing a return in the market right now.”
And that means that conservation-minded buyers might end up getting some bargains, where the price of “green” homes doesn’t reflect the money that went into their construction or, for that matter, the low operating cost of living in the house itself.
Hidden Value
In Salinas, Calif., a $3.6 million, 6,330-square-foot house has a neutral footprint thanks to large solar panels set on the property’s 10.8 acres. “Just from the list price and how much my clients have invested, it’s a great value,” says the Compass agent Mark Peterson, who’s listed the property.
The sprawling, Spanish-style home is hooked up to public utilities, but is designed for more than two weeks of off-grid living. Along with the solar panels there’s a backup generator, and there’s a well-onsite as a backup water source, even though it’s also hooked up to the town water system. (The backups can be turned on on demand.)
But, Peterson says, “it’s hard to market these features as the primary draws. At the end of the day, a house is still about how it feels and what its environment is like.”
So despite the home’s minimal energy costs and comparatively light environmental impact (it is, after all, still a mansion), Peterson says that he still has to price the house just like any other. Its price per square foot is $569; a house a few doors down on the same street, set on a lot just the tenth the size of Peterson’s listing, had almost the exact price per square foot until last month, when it took a $200,000 price cut. Now it’s currently priced at $3.8 million, or $542 per square foot.
Down the road, a house that’s half the size but on a larger plot is priced at just under $3 million, or $889 a square foot. Neither of those houses has environmentally sustainable systems comparable to Peterson’s listing.
“When someone’s purchasing a house,” Peterson says, “they’re still going to look at aesthetics first.”
This article was provided by Bloomberg News.