green certification

Evaluating Green Home Certifications

Last month, the UCLA Institute of the Environment and Sustainability released a report that looked at the difference between homes sold with and without third-party green certifications.

Companies like Energy Star, LEED and Greenpoint Rated offer certification programs for houses that meet specific eco-friendly requirements. These criteria can include everything from energy-efficient appliances to the use of recycled building materials. The study found that homes with these certifications were selling at prices 9% higher than similar homes without certification.

Why We’re Asking:

“Green” upgrades are often advertised as a great way to increase the resale value of your home. But just upgrading your refrigerator doesn’t qualify your entire home for green certification. For a buyer that’s interested in purchasing an eco-friendly home, it’s hard to imagine they would choose one that is only partially upgraded. Energy efficiency is an investment in the environment, but that doesn’t mean it can’t be an investment for the homeowner as well. We’re reaching out to our green experts this week to get the skinny on green certifications.

So green experts, it’s time to weigh in:

How Valuable are Individual vs. Whole Home Green Upgrades?

Are whole home certifications the only real way to increase the resale value of your home with green products?
Are some certification programs more respected or widespread than others?
Are whole home retrofits expensive? What problems might homeowners run into if they try such upgrades?
Are there tax incentives or rebates specifically for whole home green upgrades?

As real estate prices across the country are increasing, we want to help homeowners get the most value when reselling their home.

Experts, post your answers in the comment field below!



  • Tanya Stock @ VidaVerde 08/13/12

    Green has now become the most overused word in the Home Building environment and I avoid it, much like certifications.

    The cost of certification means hiring (people like me if I actually still did but I no longer do) individuals and businesses that add the costs of certification onto the costs of the improvement. The costs vary depending on the type of certification one elects to pursue – LEED, Green Advantage, Build Green and so on. Each with their own requirements and subsequent levels of rating, etc. Much of it similar and redundant so why one is “better” than another is debatable.

    I say if its what you want to do have the money to do it go for it. Otherwise spend your money on what matters. And what matters is making sure a home is energy efficient, manageable and affordable. A home’s energy efficiency is easily measured and can be upgraded for an affordable price. Again like the certifications that too can come in a wide variety of plans, ideas and outcomes. But ultimately there is a base level (which any of our other eLocal experts will be happy to elaborate) which is needed to measure home performance. Then from there making sure the home is easily maintainable can lend itself to a selling point. No one wants to buy a home to find out all those “green” features have high and frequent maintenance costs.

    And yes “green” upgrades do come at a cost and yes there are ways to offset said costs via rebates and tax incentives. However if you are not living there and the point is to sell, where is the payback period? Should you not be the one reaping that benefit?

    The person who is living in the home should benefit and make sure that all that benefits them is what they need, want and can afford. Finding your right shade of green that suits you best is what anyone should and can do. It’s what I do for my customers. And sometimes it means saving vs. spending green.

  • Pablo Solomon 08/13/12

    Like any other certification, a “green” certification is only as good as the people actually doing the certification and whether or not it means anything to a third party.
    Certifications cost money. That cost must either be absorbed by the contractor, seller, real estate agent, etc. or passed on to the buyer.
    And like anything else, the proof of the pudding is in the taste. If you can show a potential buyer or client that you have documentation of meeting or exceeding normal energy saving guidelines, that is usually sufficient.
    It is sort of like having a Better Business Bureau sticker on your door. If your town has a great BBB, it might mean something. If, like too many towns, it is little more than a sticker showing you pay dues to give some people in the BBB office a paycheck for doing very little–then not so much respect.
    If you as a builder or designer have a great green reputation, a “green” certification will do little to add value. The same goes if you have a bad reputation as a builder. Just having a sticker on a window will not make up for being a second rate builder.
    On the other hand, these certifications do provide a quick way to know if a house is at least reasonably “green”. If the certification companies themselves build a strong reputation and bust any contractors trying to pull a fast one, then they will be more and more relied on.
    I may be the worst guy or the best guy when it comes to stuff like this. I really am very self confident and depend more on my own skill, honesty and integrity than on having some one else tell me that I am OK. I always admired Napoleon for crowning himself instead of letting the Pope do it. Of course I have to admit I have enjoyed getting my awards here from e-Local as I am a ham.

    Best wishes,
    Pablo Solomon
    Artist & Designer

  • Kraig Kalashian 08/13/12

    While certifications are nice, the most effective upgrades are the ones that create value by saving money while enhancing performance. Having better doors, windows, and insulation can equate to significant energy savings. Newer windows and doors are definitely an attractive feature to buyers. Additional equipment upgrades in ventilation, tankless hot water heat, and energy star appliances also have a great return on investment and will save you money while you use them. LED lighting is also a nice enhancement and will one day be standard in every home. A home automation system that controls lighting, security, and temperature is also becoming more common and saves alot of money by monitoring usage and controlling excessive practices. Having a home with this kind of technology will definitely net a great return since these kinds of controls and products are the future of energy efficiency.

  • Anna @ GreenTalk 08/14/12

    It depends on the area where you live. Certifications are costly so in my opinion, they aren’t necessary unless the homeowner believes in the certification. Upgrading your heating/air conditioning system, appliances, and caulking around windows and doors reduces your energy bills. Lower utility bills will make your house more attractive. However, you have to weigh the payback with the length of probable stay in the house.

    Having sold a few of my own homes, it all seems to come down to the kitchen and bathrooms. The electric bills seems to be secondary. Updating these with new energy efficient and green appliances, fixtures, and toilets goes a long way.

  • Grand View Builders 08/14/12

    In our opinion, there are many different ways to improve the resale value of your home, and going green is a great avenue to venture down. The NAHB has great information on green certification, including a spreadsheet rating system displayed here which compares different certification systems and their cost and technical requirements. The list does not delineate between the most renowned certifications but each certification does have different rating levels. Tax incentives can be found here as well, and as you begin your green improvements, we recommend working with your accountant to see which rebates are applicable.

    While many Grand View Builders homeowners buy for life, we have seen homeowners who choose to upgrade and sell in a few years. Luckily, for them, their green incentives are built in, as their houses come equipped with ENERGY STAR lighting and appliances that utilize established technologies to achieve energy savings. By buying a home with green savings built in, you already have your first green incentive when it comes to re-selling!

  • Greg Chick 08/15/12

    How about a look at the last year in utility bills? This is as “ROI” as it gets. What about looking to see reports from a “real” home inspector with a thermal imaging machine to see in the walls? Tankless water heaters can be more consuming than the normal tank type. Quality toilets that actually work are listed as water savers as are the ones that are marginal at best. The rating is weak if the install is by unskilled installer. I am a certified trainer for Green Plumbers and I will tell you that products themselves are lost on ignorant installers. Even my training is at the mercy of reality. A home is a system, one must understand more than many raters understand. I am not finding fault with rating systems per se, I am suggesting reality is what it is and a previous year of utility bills is as good as many ratings and better than some. I do suggest many “green” things, but am also tired of the word.
    Greg Chick, Certified Gr### Plumber Trainer

  • David @ Energy Upgrade California 08/16/12

    How Valuable are Individual vs. Whole Home Green Upgrades?

    The most effective way for a homeowner to receive the greatest impact on their utility bills is to understand the way the home performs, why is your utility bill each month the price it is? Most of the smaller items that plug into outlets don’t have the greatest effect on your utility use because Energy Star, for example, is a reduction compared to a baseline which isn’t really comparing it to your current refrigerator or TV set. Secondly, leaving your lights on or TV on can undo all of the benefits you’ve invested in to begin with.

    The biggest bang for the buck comes from upgrading the parts of your home that result in the most amount of energy loss: air ducts, ceilings and walls, doors, and windows.

    I’m not saying that windows are the quick fix. What I’m saying is that air sealing including closing off all penetrations between your living space and the outside, sealing up the ductwork between your heater or air conditioner and the vents, and insulating your attic space first and then your walls is the least expensive way to see the greatest impact on your utility bill. If you have your home properly sealed and ventilated, all of the air you are paying to heat or cool are staying only in the living area while you need them, rather than leaking out through things like outlets, recessed lights, window sills, speakers, and more going out through your roof and outside of the house.

    Plus your home is now more comfortable, quieter, and believe it or not, healthier. These benefits far surpass the energy saving benefits.

    Energy Upgrade California is a statewide program designed to help homeowners receive rebates and incentives to help pay for these types of improvements that I’m talking about, lowering the cost barriers even greater, allowing for greater benefit. Here in LA County, homeowners can receive up to $8000 in incentives to help pay for these upgrades. But, this is a time sensitive promotion. It should go down to around $4000 in incentives available by the end of the year. http://www.energyupgradeCA.org/LACounty.

    Are whole home certifications the only real way to increase the resale value of your home with green products?

    The national appraisal organizations have created appraisal processes to help appraisers document all of the green upgrade work that may have been done in a home, but a green home certification is the only way those improvements can be vetted through a third party, leading to credibility and confidence in the information.

    An appraiser or real estate agent can easily picture the types of improvements completed when they hear that a home is either LEED or GreenPoint Rated. Some MLS groups have green certifications already as a searchable item in their database, allowing real estate professionals to easily identify homes that have had a standard list of improvement types, showing a certain level of performance.

    Eventually, enough homes with green certifications will sell quicker and for more money, giving appraisers “comps” all over California for them to use to justify these home appreciation values. The challenge has always been that appraisers had nothing to compare green improvements to. Now they do.

    Are some certification programs more respected or widespread than others?

    LEED has been the standard for the commercial new construction sector, bleeding over into the new home construction sector. However, the only existing home retrofit green certification is the GreenPoint Rated Elements and Whole House Ratings.

    Since there is no other certification program besides GreenPoint Rated in LA County, Energy Upgrade California is offering an additional $1000 rebate for homes that achieve the GreenPoint Elements Label and $2000 for the Whole House. Tack that onto an Energy Upgrade Project and you have $10,000 waiting for you to claim. That’s a lot of money to help you reach your goals!

    Are whole home retrofits expensive?

    Like people, every house has its own personality and its own performance deficiencies. A Participating Contractor in the program really needs to come to the home and figure out what needs to be done to receive the most amount of rebates for the least amount of money. The rebates were designed to cover about 50% of the costs, which is pretty amazing.

    Some homes in the program have gotten to 40% energy savings for about the cost of the incentives, so it was only a couple hundred dollars out of pocket. However, from all of the projects that have come into the program since we have launched in 2011, the average construction cost has been around $13,000 with 30% energy savings and $6000 in rebates. This is for the whole house upgrades.

    I will say that LA County has recognized that some homeowners may not want to upgrade their entire house at this time, so we created a Flex Path program that allows homeowners working with Participating Contractors to do a minimum of 2 measures from a list that have various point values based on their energy savings impact, and if you can get to 100 points with those 2 or more items, you can get a flat rebate of $1500. These Flex Path jobs have been coming in around $4000 construction cost, so the rebates still make an impact, yet it isn’t quite as lucrative as the Advanced Package Whole House Incentives.

    I will add that LA County has 2% financing for qualified homeowners that wish to pay off their whole house upgrades over time. Additionally, if a homeowner wishes to take out and energy efficiency mortgage at the time that they are buying or refinancing their home, they can add the improvement costs into the mortgage and pay it off over 30 years, which adds a very little premium to the mortgage.

    What problems might homeowners might run into if they try such upgrades?

    LA County is partnering with Southern California Edison and SoCal Gas Companies for the Energy Upgrade program. Like I said before, Energy Upgrade is available statewide, but LA County has additional rebates available to homeowners that aren’t available in other counties at this time.

    To answer the question, the utility partners have very strict mandates they must follow to quantify the energy savings associated with the upgrades. Therefore, they require a third party verifier to come out to the home and retest what your contractor did both before and after construction. This is meant to build credibility for the contractors participating in the program as well as confidence in the program. Since you must use the Participating Contractors in the program, it is important to have a third party company holding those contractors to a very high standard.

    Homeowners that understand this extra step as a positive have no problems working through the Energy Upgrade process, and they gladly take advantage of the checks they receive from the utility companies and LA County.

    Are there tax incentives or rebates specifically for whole home green upgrades?

    This question is answered above. For the Green building labeling rebate as stated above, more information can be found at http://www.energyupgradegreenlabel.org

  • Peter L. Mosca 08/17/12

    Despite witnessing a shift from anecdotal evidence to well-documented scientific case studies proving the value of GREEN and sustainable buildings, many refuse, in any significant way, to move from fossil fuels to nature’s energy sources. Until we as a country unify behind a “GREEN Plan,” designations, certifications and retrofits will be just as their names imply: upgrades, additions, piece-meal attempts to make change when the biggest change, I believe, needs to come from the hearts and minds of consumers, investors and buyers.

  • Sam Lazarus 08/17/12

    Any product that is “certified” has an added cost factor to it. In the current soft residential real estate market, I am not so sure if such certifications are worth the benefit. There may be a time and place for that, however generally speaking this direction does not convince me as a worth-while investment.

    There are “green” upgrades that are available on the market, if a home has them, they may seem worth-while, but how they affect things such as utilities that have a direct effect as a ROI needs to be considered. Pre-formed walls made of Styrofoam filled with concrete or solar heat or wind turbine to supplement the energy consumption in a home, if effective can be directly seen in comparably built homes.

    Tax incentives and rebates may be available and seem like a good idea, but always consider the ROI.

    No upgrade is worth it, if it does not provide a return on investment of the dollars invested.

  • Jason Todd 08/17/12

    Buyer beware! That is the saying right? There should be a healthy dose of skepticism for new certifications or promises of savings or being greener than the neighbor. The UCLA study speaks to homeowner’s desire for healthy and efficient homes, of being responsible and living with those choices quite literally. They proved this by consumer’s choice based on labels.

    Unfortunately, or maybe fortunately, these labels are often directed only at new homes. There are plenty more, the lion’s share of the market, that are already built. This is where we can make the greatest impact, whether or not you are selling your home!

    With state incentives found in California, New York and elsewhere, I can’t stress enough how beneficial it is to capitalize on them! Financial incentives for energy improvements will only increase the return on investment. Even without incentives, investing in comfort, efficiency, and health and safety benefits the homeowners now. Label or not, I’m certain it helps with the resale value later. Retrofit a home and make it a high performer? As they say….Priceless!

  • Nancy Dalton 08/17/12

    As I work with clients designing and remodeling kitchens and baths we discuss green, energy and water savings routinely. Our clients want to use greener products but the extent to how green that will be varies. So many of the products I specify and use are forestry certified or CARB compliant that some “green” is built right in without a discussion.
    Probably because we are not doing new construction and generally working only in certain areas of the home whole house certification does not come up as a need or desire. If I were buying a new home and could see big savings in my energy costs looking forward, it would be a reason to buy one house over another.

  • Steve Labbe 08/18/12

    In New Hampshire we have National Grid which just changed their name to Liberty Utilities who have always promoted lower prices and incentives to move to Natural Gas.

    My clients really enjoy receiving a free line service to the house or a discounted rate on the equipment they choose. Gas Works has rebate forms for 2012 that give you back money for using Energy Star Products. http://www.energystar.gov

    We install Laars and Baxi which are over 93% efficient and saving our client money on the install as well as providing a cost savings every time the unit goes on. We also like to mix this up with solar panels piped to buffer tanks to capture the suns saving power.

    You are welcome to go to my You Tube Channel under Paradigm New Horizons NH and you will see how we heated all the hot water for this Manchester Shelter by installing five solar panels. I believe we can pay a little more up front to save money over time.

    Remember when we are kind to our world by using green product the world responds in kindness back to us. Feel good about how you live by investing in High Efficient Product with Energy Star Ratings.

Comments are closed.