Builders, buyers and lenders get new guidance for valuing green homes
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The value of homes built to new energy codes should be reflected in the appraisals for lending, and appraisers can use new information from the Appraisal Institute to reflect better buildings.
The Appraisal Institute and the Building Codes Assistance Project released guidance for homebuilders, buyers and lenders related to valuation of green and energy-efficient homes.
“New homes built to the 2012 or 2015 IECC [International Energy Conservation Code] are high-performing, and the appraisals should reflect that,” said Maureen Guttman, president of the Building Codes Assistance Project. “This letter gives the industry step-by-step guidance to help make that happen.”
“Appraised Value & Energy Efficiency: Getting It Right” is a two-page document that provides important information for those involved in the purchase or sale of a home that has green or energy-efficient features. According to the guide, “Energy efficiency can be overlooked in the appraisal process for a variety of reasons. However, there are many specially trained appraisers who are qualified to assess the value of these features.”
The guide includes ways builders can help the buyer assure a competent appraiser is selected. It also assists buyers in learning about the loan and appraisal process and working with the lender. And it offers information for lenders about hiring the right appraiser for the assignment. One recommendation is to access the online list of qualified appraisers in the Appraisal Institute’s Valuation of Sustainable Buildings Professional Development Program Registry.
The Appraisal Institute is the nation’s largest professional association of real estate appraisers with nearly 21,000 professionals in almost 60 countries. The Building Codes Assistance Project is a non-profit organization that strives to be the premier resource for energy code support, coordination, technical assistance, news and information.
“As the leader in green and energy-efficient real estate valuation, the Appraisal Institute provides timely, relevant information to those who need it,” said Appraisal Institute President M. Lance Coyle, MAI, SRA. “Working with the Building Codes Assistance Project, we have produced helpful tips to promote the hiring of competent, qualified appraisers.”
Since 1994, the Building Codes Assistance Project’s goal has been to reduce building energy use by promoting the adoption, implementation and advancement of energy-efficient building codes and standards on the state and local levels and internationally.