Is there Extra Green when you Buy Green?

'Green' home brings in 9% more green, California study finds

The study looked at an unusually large sample of 1.6 million homes sold in California between 2007 and early 2012, Ken Harney reports.

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July 20, 2012 - It has been a controversial question in the home real-estate market for years: Is there extra green when you buy green?

Do houses with lots of energy-saving and sustainability features sell for more than houses without them? If so, by how much?

Some studies have shown that consumers' willingness to pay more for Energy Star and other green-rated homes tends to diminish during tough economic times. Others have found green-certified houses sell for at least a modest premium over similar but less-efficient homes.

But a new econometric study involving an unusually large sample of 1.6 million homes sold in California between 2007 and early 2012 has documented that, holding all other variables constant, a green certification label on a house adds an average 9 percent to its selling value.

Researchers also found something they dubbed the "Prius effect": Buyers in areas where support of environmental conservation is relatively high — as measured by the percentage of hybrid auto registrations in ZIP codes — are more willing to pay premiums for green-certified houses than buyers in areas where hybrid registrations were lower.

The study found no significant correlations between local utility rates — the varying charges per kilowatt hour of electricity in different areas — and consumers' willingness to pay premium prices for green-labeled homes. read more>>>