We are about to get an appraisal done on our newest home, which was built to Passive House, EarthCraft and Energy Star standards. Since the mortgage crisis, lenders no longer can select their appraisers. Our bank has a list from which they get quotes and they make their selection on price, availability, experience and perhaps other features of which I am not aware. Regardless, if you have green features in your home that you would like to be valued in the appraisal, you have no control over getting someone with experience in that area.
Not that there is currently a good system for comparing houses with green features to really determine how they affect value. Nationally, the USGBC LEED and EnergyStar green certification programs are sometimes used by lenders/insurance providers to give a discount or additional coverage. For appraisers, the market is extremely local. First off, the MLS system is regional and the database is created for/by locals. We are starting to get to a point where CAAR is looking at introducing more environmetal features to their listing database, which would allow an appraiser/realtor to look up comps. The regional EarthCraft program is a an easy check-off feature to compare home sales. However, this is not yet clearly available to consumers looking for environmentally-conscious or energy efficient homes. Thus, even if “green” features, eg reduced energy bills, legitimately affect the value of a home, it is not always calculated into the valuation.
Now, I am sort of confusing two issues. One is value for appraisals that leads to financing. The second is value that consumers place on a property. However, in both cases, I would like users to be able to make better comparisons to other properties.
One new step in this direction is an addendum (Residential Green and Energy Efficieny Addendum) released this year by the national Appraisal Institute to help appraisers better value green features. I am glad they have initiated this, and that they are now offering classes for appraisers looking to learn more about these valuations. I have MANY edits that I would like to see incorporated into this document (honestly, I’m not sure how it got made), but it is a start! I am now going to fill out this form for our house, pass it on to the appraiser (luckily someone local), and see how she uses it in her valuation.