Agents, brokers and builders alike are looking at ways to tap into the "green" movement — an emerging awareness about minimizing environmental impacts. And what they find can be overwhelming, as the number of green-branded designations and products and services has soared.
But what does green mean? That depends on who you ask.
Green can mean different things to different people. Some people throw their plastic water bottles in the recycling bin, and then crank up their air-conditioning. Going green could be alternately viewed as trendy, a marketing ploy, a moral choice, a lifestyle, or an economic decision.
Pollution from gasoline and other energy consumption can harm the environment and your personal finances, as an example.
Some real estate agents and brokers are jumping onto the green bandwagon by taking classes to become certified in less environmentally threatening practices, for example, and some building companies are altering construction practices and products to take Mother Nature into account. Residential and commercial buildings are big contributors to environmental damage through sources like greenhouse gas emissions, building materials and water usage.
According to data from the Energy Information Administration, U.S. emissions alone represented about 22 percent of the world’s total in 2004, and about 17 percent of greenhouse gases are from the residential sector while 18 percent are from the commercial sector. The industrial sector accounts for 36 percent and transportation amounts to 28 percent.
The average size of an American home has doubled since the 1950s. Now at an average size of 2,349 square feet, modern homes can feature huge bedrooms with private porches, coffee bars and walk-in closets.
While people may not need the added amenities, they may want them. Arrol Gellner, an architect with 30 years of experience in residential and commercial architecture, said he believes that the trend toward big houses has in itself damaged the environment because it is using unnecessary resources.
"Families are smaller than they were at that time and that doesn’t make sense to me," Gellner said. "People don’t have to give up things that they like, but I don’t see justification in all that square footage because all of it doesn’t get used."
And what makes a building "green," or more eco-friendly?
Giant homes require more resources, namely wood and other building supplies, and also require more energy to heat and cool than smaller homes. Home designs, construction materials and appliances can improve energy efficiency for homes of any size.
The National Association of Home Builders released Model Green Home Building Guidelines in 2004. The building guidelines outline standards for "resource-efficient, cost-effective home building."
There are also programs available for real estate agents to become "green"-certified. EcoBroker, a program that offers real estate professionals resources for addressing environmental issues, has offered a certification program since 1992 that now has 4,000 members in the United States, Canada, the Caribbean, Mexico and New Zealand. Licensed real estate professionals take a series of classes and must take a four-hour class during every year of certification to maintain the "EcoBroker" designation.
This is one of many "green" certification courses.
A "Green Leadership Certification is available for $100 from Green Real Estate Certification, and the National Association of Green Agents and Brokers also offers a green certification course.
So how do designations like EcoBroker and others similar to it help agents help customers?
EcoBroker-certified Chase International agent Guy Johnson said that he considers his green education to be a valuable asset. While some agents promote themselves around being a "green" agent, Johnson said he considers his certification as one of the many tools in his skill set.
"I need to be prepared should I have a client asking me questions regarding green features of homes and energy efficiency," Johnson said. "I don’t go out of my way to make recommendations for home improvement, but I do want to be prepared should I be asked. I look at it more as a skill or tool to have. I do market my EcoBroker certification only in the sense that I add it to the back of my name like any certification that I have. Just because I got certified doesn’t mean I change my whole marketing concept to revolve around that."
Johnson said he has seen a change in the features clients look at while searching for a home. With his certification training, he says he now has the resources to help his clients answer questions about costs related to energy-efficient features.
"I see buyers walk over to the windows and tap and see if they are double or triple pane," he said. "I’ll see them open up a sliding door. Not only are buyers aware of the things that make a home more energy efficient but they are actually checking those things out when previewing those homes."
As energy costs have risen, solar panels are finding popularity with homeowners. The payback period depends on the size of the home and the number of panels and can be lengthy, but Gellner said clients who have opted for solar panels understand that it is not a "dollars or cents decision," but a moral decision — some people are willing to spend a lot of money if they feel they have done something right for the planet.
For a San Francisco Bay Area couple whose electric bill used to be $8,000 per year, installing solar panels made an instant difference. After installing 42 panels on the home and eight pool panels, the owners saved $6,000 per year.
"At the rate that we were going it was money out, money out, and nothing coming back in," said homeowner Susan Wilkins.
With a price tag of $30,000 to $50,000, she estimates that the panels add about $80,000 to the value of her home. The Wilkinses are looking at an eight-year payback period, but the decision to go solar was not just about the electric bill.
"It was a priority to do something positive not just for ourselves but (for) our children’s future," she said. "When you put solar panels up you don’t just work for yourself, you work for your community."
The eight pool panels heat their saltwater pool to 90 degrees. In addition to the energy conservation and cost savings through the panels’ installation, the family also cut down on water use by installing artificial turf in the backyard, and they bought a hybrid vehicle to save on fuel costs.
Rick Wilkins, Susan’s husband, offered advice to others who are studying the solar option: "Do your homework. Look at rebates offered. It’s a matter of choices. What’s going to matter in 10 years? Is the high-priced vehicle that you buy going to make a difference in 10 years, or will it make a difference if you spend on something lasting and enduring?"
In a National Association of Home Builders survey of U.S. multifamily builders and developers, 74 percent of participants said the median extra cost that buyers and renters are willing to pay for green alternatives is 2 percent. About 89 percent of survey participants said they are installing energy-efficient appliances and lighting in their projects. More builders and developers are also using recycled and recyclable products, more insulation, and windows with low-emittance (also known as Low-E) coatings on glass surfaces that reflect radiant heat and lower the heat flow into a home.
LaPolla Industries manufactures spray foam, which is applied as an insulation product that the company claims has more value than the conventional fiberglass product. CEO Doug Kramer said foam could provide twice the value of fiberglass.
"Today, asthma and other respiratory challenges are at an all-time high," he said. "By restricting that air flow you can now control air quality."
Kramer said that installation of the foam can lead to immediate savings in utility costs and the product has a return on investment in three to five years. The term "green" is often used to signify a recyclable or renewable resource, though it also relates to conservation and controlling costs, he said.
"It encourages people to look in more detail for alternatives," Kramer said. "In the past, when people have built homes they have been more concerned about decorative issues. Now they are looking past the wallpaper. The trend is a reflection of the transition, and I think it is a permanent result."
Christopher B. Leinberger, a land-use strategist, developer, and professor and director of the Graduate Real Estate Development Program at the University of Michigan, says there are two aspects to green building: place and within a place. In other words: the building itself, and where and how the building and surrounding area is planned.
"But the two of them together, when you add up the contribution to both energy usage and (carbon dioxide) emissions and other greenhouse gasses (the) combination of place and within those places is over 70 percent of emissions within this economy. It’s by far the largest contributor to energy emission and greenhouse gases."
The other realm of urban planning is creating "walkable" urban places. If a building is accessible by bike, walking, transit, bus or car, the area will use one-fourth of the energy compared to a place where all transportation to a building is by vehicle. Leinberger said that a high-density urban building would unintentionally share heat with other units, which means lower energy bills.
By "walkable," Leinberger means an environment where most daily needs can be met on foot: people can walk to work or transit is nearby. In a nation where public transportation is severely lacking (compared to Europe), Leinberger said he believes it will take at least a generation to catch on to this mentality.
Real estate agents can aid in the greening of a community by locating for-sale homes near public transit or within a short commute to a client’s workplace, for example.
In some suburban communities, all or most trips outside the home may be by car, with energy consumption and greenhouse gas emissions far exceeding those in a walkable urban development areas. Leinberger said it is possible to cut emissions by 75 percent by providing a walkable environment.
Leinberger serves as an advisory board member for Walk Score, a Web site that tracks the walkability of communities to nearby stores, restaurants, schools, parks and other destinations (see Inman News).
The site calculates distances and assigns a score between zero and 100. A Walk Score of 70 indicates a person is probably part of the solution to climate change and a score below 30 indicates you are probably part of the problem. The most walkable neighborhood, according to the site, is San Francisco, followed by New York, Boston, Chicago and Philadelphia.
In particular, opportunity to develop around commuter rail stations could spur billions of dollars in development, but significant obstacles like local zoning measures and opposition from a variety of sources can be difficult to overcome, said Leinberger.
"We have thousands of commuter rail stations throughout this country that are tremendously underdeveloped, Leinberger said. "Many have no development at all. Much of the land — if developed properly, that land is worth $50, $100, upwards of $1,000 per square foot around those commuter rail stations. Many times that land is vacant, used as a parking lot, yet that land could be worth hundreds of dollars (per square foot)."
He said there does exist a "fear of development," which he said is a problem that prevents walkable communities from taking shape.
While new developments in drivable, low-density communities can decreases a neighborhood’s quality of life as the next subdivision takes away space and adds car congestion, walkable high-density developments can provide for a higher quality of life as there is less of a need to drive, he said, adding: The result is that more is better.
Leinberger says that price declines can be more severe in less walkable areas than in highly walkable areas — prices have held up better in downtown San Francisco, for example, than in inland areas such as Merced County, when home-price drops have exceeded 50 percent in some cases.
People living on the fringes have long commutes and are getting pounded by high energy prices, which is in turn making their homes worth less, he said, Leinberger said.
Although the green movement is catching on and people are becoming more aware, some consumers are still distracted by the glitz and glamour of dream homes and cars.
Gellner said, "If you take the example of a car, people might be interested in fuel efficiency, but it won’t make their decision for them. They have their conscious and subconscious desires for a car. A house is very much the same thing. People want to have the biggest, fanciest house on the block. I don’t think energy efficiency is at a point where that would be the driving determination."
When it comes to building houses, Gellner has a pragmatic approach. He uses materials that weather time well: wood, brick, stone, slate, and organic and non-petroleum-based materials. These materials hold up for up to 100 years and coincidentally are green materials as well, he said.
"I avoid plastics in construction. Not because I’m some kind of green pioneer," he said. "I don’t like the feel of plastic, and it doesn’t hold up over time. It’s just a coincidence it’s a lousy material for the environment."
He added, "I don’t build a house bigger than I need. I don’t expend resources unless I’m using them to some end. A big giant house that’s not occupied isn’t an efficient use of those resources. There is certainly nothing wrong with using materials, but it better be used with good purpose."
In 1978 the California Energy Commission established Title 24, the Energy Efficiency Standards for Residential and Nonresidential Buildings, in an effort to reduce California’s energy consumption. California was the first to establish standards like these, and few states have followed suit since. The state’s standards, along with standards for energy-efficient appliances, have saved $56 billion in electricity and natural gas costs, according to the CEC Web site. The current standards went into effect in 2005, and a new set of standards will go into effect in 2009.
The U.S. Green Building Council, a nonprofit that works to expand sustainable building practices, offers LEED (Leadership in Energy and Environmental Design) certification — the USGBC has certified 1,705 buildings since the program’s start in 2000.
Projects and certified buildings include both new and old buildings, interiors, retail buildings, schools and homes — a different set of requirements apply to each property type.
LEED-certified buildings, according to the Web site, are designated as environmentally responsible if they lower operating costs, increase asset value, reduce waste to landfills and are healthier for the building’s occupants.
Zoning requirements can encourage green construction in a given community by changing zoning policies to allow different building practices that are more conducive to walkability and less environmentally impactful design.
Civic zoning ordinances could be designed to encourage more compact and efficient houses, for example, though "Right now they don’t do that whatsoever, In fact, they do the opposite," said Gellner.
Leinberger said he believes the real estate community must get behind transportation reform at a federal level to change policies to allow more walkable communities to be built. In 2009 Congress will be putting out the new Transportation Bill that will decide policies for development.
Since this happens every six years, Leinberger encourages real estate developers to be present.
"Transport drives development," he said. "(The bill) dictates development the real state industry engages in. We need a bill that provides choice, not just (a) monocle approach, which is a choice of either driving or driving. That’s what we have today. We need multiple choices — not just from an environmental point of view but from an economic point of view."
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