Real Estate Journal Online

In today’s housing market, it can be hard to drag buyers’ attention away from the bargain basement prices available through REO and foreclosure home sales. Builders and developers are relying heavily on green, energy- and money-saving features to do just that – and it’s not cheap. Dan Hogan, supervisor of residential energy programs at Tucson Electric Power, explains that builders and developers hoping to compete with the falling prices of distressed homes are going to have to take on additional costs to make homes more efficient and cost-effective for homeowners[1]. “To build an energy-efficient home…you just have to put in better pieces,” he explains, adding that “better pieces” like spray foam insulation and water-saving plumbing mean more money for builders that is often difficult for homebuyers to see or understand. To combat this issue and help make the case for the higher price tag, one developer actually offers tours of a deconstructed model home that shows of “energy saving features that would otherwise be hidden by finished construction.” The argument is that newer, more energy efficient homes, while having a higher price tag, save homeowners serious money over the life of homeownership.

It’s hard to say in today’s market whether that argument will be persuasive enough to convince qualified homebuyers who have their pick of properties on the cheap to go green. Do you think green development is the key to recovery in the new-construction sector?

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