Styled, Staged & Sold

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Can You Retrofit Older Homes to Increase Resale Value?

By Melissa Dittmann Tracey, REALTOR Magazine

About 130 million homes were built prior to energy codes and are in need of an energy retrofit, panelists said Saturday at the session New Tricks for Old Homes during the REALTOR Conference & Expo in Anaheim.

“There’s an opportunity to revitalize the older housing stock and refresh them as green homes,” Bob Sahadi with the Institute for Market Transformation told attendees.

“Green” retrofits could add up to a potential 30 percent savings, on average, on utility bills—not to mention, increased home owner comfort (in fixing drafty homes) and achieving better air quality circulating throughout the home, panelists said.

“Green” upgrades aimed at energy efficiency continues to get more recognition in the real estate business as more home owners look for ways to curb rising utility costs as well as potentially increase the resale value of their home. Newer homes are increasingly being built “greener” and as “green” increasingly becomes important to home buyers, older homes not built to current standards may struggle to compete, panelists said.

Many home owners may be confused about how to go about retrofitting their older houses and making them more competitive.

That’s where real estate professionals can step in — educating clients about federal, state, and local rebates and incentives programs available as well as financing options like Energy Efficient Mortgages, to help cover the costs of the retrofits. Real estate professionals can build a “green team” of contractors to point clients in the right direction too.

For older homes that need an energy retrofit, the first step often is getting an energy assessment or audit of a home, which can serve as a blueprint of what home owners need to address to make their home more comfortable, healthy, and energy efficient. Energy auditors may use such tools as infrared cameras that can reveal energy or heat loss problems in a home, or blower doors that depressurize the house to identify air leaks.

Many home owners also may be unfamiliar with the financing options available, such as Energy Efficient Mortgages (like the FHA 203(b) Energy Efficient Mortgage and EEMS available through Freddie Mac and the Veterans Administration), the HUD/FHA PowerSaver loan, or state, local, and utility programs. Several states also offer incentive and rebate programs, such as solar water heating rebates or energy conservation loans.

Learn about the programs available in your area, form “green teams” to be able to point your customers to qualified contractors (such as through the Building Performance Institute, www.bpi.org, in which you can find qualified contractors by region), and learn about green home labels (like LEED, Build Green, and Energy Star), said John Shipman, an NAR GREEN designation trainer. NAR’s GREEN designation can help real estate professionals ramp up their knowledge base, learn how to form “green teams,” and build a niche business of green in helping home owners retrofit their older homes.

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