Efficient and Resilient Homes

“You cannot get through a single day without having an impact on the world around you. What you do makes a difference, and you have to decide what kind of difference you want to make.” –Jane Goodall

Those words from the famed anthropologist truly resonate with Craig Foley.

He’s a REALTOR® and the chair of the NATIONAL ASSOCIATION OF REALTORS® Sustainability Advisory Group (SAG). He’s also the chief sustainability partner at LAER Realty Partners in Winchester, Mass.

Foley’s mission today is to educate his peers and consumers on why it’s imperative that homes become higher performing and more energy efficient. “Ours may be the first real estate company that has hired a person to lead sustainability,” he says. “Hopefully, it won’t be the last.”

Our weather is affecting the places where we live, and we have to pay attention.

Phoenix REALTOR® Melisa Camp, M.Ed., GREEN, LEED AP Homes, is just as committed. She’s also a member of NAR’s SAG, and she founded a company that provides continuing education to REALTORS®, appraisers, architects, and LEED professionals on green building science, marketing green homes, and other home sustainability issues.

As both work to expand the high-efficiency home market, they’re also aware that their efforts will help homeowners protect against weather events.

“Everybody has to do something,” insists Camp. “The worst thing we can all do together is to do nothing. Phoenix doesn’t have a lot of natural disasters as other areas do, but my observation is that attitudes are changing because they have to. Our weather is affecting the places where we live, and we have to pay attention.”

The trend gains steam

For Foley, Camp, and other sustainability evangelists, the goal is to have all buildings be net zero, which means their systems create all the energy needed for their operation.

When he’s speaking to developers and builders and teaching the GREEN designation course, Foley takes a step back before talking about net-zero buildings. “One thing I try to address is that there are two ways to tackle the challenges of increased carbon going into the atmosphere,” he explains. “Most of us hope the supply side, meaning the power companies, gets it together and shifts to a clean-energy system.

“But if we wait on the supply side to do that, we’re not going to win,” insists Foley. “There’s also the demand side, and that’s where things like net-zero and existing homes that do energy-efficient upgrades are a really big part of the solution.”

Camp agrees. “I think there are two emerging markets — new homes and existing homeowners making upgrades,” she says. “My motto for everybody is to just start. Just start with something.”

But where to start? Two broad factors are typically key to achieving net zero in homes. “It’s usually a super-efficient building envelope with really good construction combined with some kind of onsite renewable generation of electricity,” says Foley. “In my area, it’s solar photovoltaics, which take the sun’s photons and turn them into voltage. I’ve been selling homes that are energy positive, which means they’re producing more clean energy than they use and sending it back to the grid.”

Mechanicals play a really big part in a home's energy efficiency.

More and more technology is emerging to allow builders and homeowners to achieve those two goals. Among the tactics and technologies that have become game changers are:

  • Where the home is physically situated — “Allowing natural light and natural ventilation is important,” states David Hertz, AIA, founder of an architecture studio in Los Angeles and a member of the Los Angeles chapter of the U.S. Green Building Council (USGBC). “Homes need to be able to let winter sun in and summer sun out, and that could just be proper placement of the home. But it could also be from things like planting deciduous trees that allow winter sun in and keep summer sun out.”
     
  • A solid building envelope — “Making sure the house is really air tight is a big factor,” says Camp. “Air sealing is super important, as is fresh-air ventilation.

    Insulation is critical here. “It’s about putting insulation in the right places,” Camp notes. “You want spray foam up against the roof deck — and homeowners shouldn’t do this themselves — so there’s a significant temperature reduction and your HVAC system doesn’t have to work as hard.”
    Windows also come into play. “Technologies have advanced so much in the last 10 years,” says Foley. “U.S. manufacturers are now doing triple-paned windows; they used to come only from Europe.”

    However, Foley wants to dispel common thinking when it comes to home envelopes. “One thing our industry has to get past — and I get this all the time in the GREEN designation class — is the idea that buildings have to breathe,” he says. “Just so we’re clear, that’s BS. Sure, there can be bad consequences for superinsulated buildings if they’re not ventilated properly. But there’s no question that air-tight buildings is the way we need to go.”
     
  • High-performing mechanicals — “A home’s mechanicals play a really big part,” contends Camp. “The HVAC system’s efficiency is evaluated by measuring SEER, or the seasonal energy efficiency ratio. Typically the higher the rating, the more efficient the unit. You’re also looking at a variable-feed system. Older HVAC systems have long on and off cycles, which really wear on the machine. Newer machines run at a steady stream, which is more efficient.”

When buildings meet the net-zero standard, they also typically better tolerate the effects of weather. “Boston has set resilient-building strategies, which also factor into this type of construction,” says Foley. “You can’t put mechanicals down in the basement anymore. They have to be on the first floor in case of flooding. Double-stone wall construction helps homes be more air-tight, but it’s also more durable and much more resilient with weather extremes.”

Options will continue to grow as more companies invent new green-home technologies. The Los Angeles chapter of the USGBC is encouraging such growth with its 2019 launch of a net-zero accelerator. “We’re approaching two degrees Celsius in increased temperature in the next 10 years on average,” says Hertz. “That will create more weather conditions that will affect homeowners.”

The accelerator is putting companies together in the hope the results will be synergistic. “About 15 companies are involved,” says Hertz. “It’s a broad array of innovative solutions. We have a lumber company that takes standing dead trees and uses that lumber locally. Another company has a window coating for electricity to be generated like a solar panel. Some of these companies are being incubated, but most already offer products. We’re hoping the accelerator can help them cross-fertilize ideas between them.”

It's not just detached homes

While Foley may be right that the world can’t wait on power companies to adjust their energy sources, there has been movement on the supply side.

In April 2019, the first all-electric net-zero attached community in southern California — City Square in Irvine — opened, and the 44-unit community with all four-bedroom units was made possible with help from a power company. “We partnered with the local utility to create a new policy to allow renewable energy to be on the communal area in a condo community and metered back to individual homes,” explains C.R. Herro, vice president of innovation at Meritage Homes.

“We’ve been building zero-energy homes for the last eight years,” he explains. “Normally, it’s only single-family homes because of the roof issue with condos and townhomes.”

By that, Herro means that those community associations typically prohibit homeowners from installing solar and other energy systems on common areas. At the same time, there’s often little or no personally owned space on which homeowners can locate them, either.

“Innate within the concept of net-zero homes is that you have to have a co-located power plant generating solar power or geothermal power,” says Herro. “In a dense project, you don’t always have the ability on your own roof to mount solar panels or to place them in your own yard. And there wasn’t a policy in place that allowed us to do this community solar distribution. To SoCal Energy’s credit, they enabled that in this community.”

Units start at $845,000. “Homes below $1 million don’t exist in Irvine,” says Herro. “That’s considered a very good price point there.” By September, 10 units had closed, and 34 remained available.

The long view on costs

The initial costs of net-zero building and retrofitting can scare consumers. But advocates say that’s the wrong measure of these homes.

“Our fuel prices here in the Northeast are very high, but when you add the solar incentive Massachusetts offers, which is second only to New Jersey in state incentive programs, it makes it an absolute no brainer,” insists Foley.

Maybe so, but Herro admits high-performing homes are still not an easy sell. “This issue has been the bane of my existence for a decade,” he says.

In Herro’s experience, about 15 percent of buyers will reject sustainable building as political advocacy. Another 15 percent will actively pursue this type of home. “The 70 percent in the middle don’t know what they don’t know,” he says. “They’re buying for location, price, and square footage, and there may be 20 homes that match their criteria. We try to inspire them to choose the best of the 20 by saying, ‘You’ve got 19 other choices; would you like to be more comfortable, save thousands in operating costs, and have a more durable home?’”

Then, Herro says, the long-term math can be convincing. For the net-zero homes his company has sold, there’s about an extra $50 per month in mortgage costs but a savings of about $200 per month in utility costs.

Incentives can further reduce homeowners’ costs. “One of the things that hopefully happens more and more is that there are incentives for sustainable measures,” says Hertz. “I just installed a battery backup system for my home because utilities are turned off regularly here. It was a $30,000 battery system, and I got $22,000 back from the utility. There are also big incentives with solar.”

The PACE program can be a good place for agents and consumers to begin researching incentives.

Foley says sales can be successful with the right education to consumers. “I sold four condos last year in Roxbury that had home energy scores of negative 14 and negative 22,” he says. (The lower the HER score, the more energy efficient the home. Negative HER scores indicate that homes generate excess energy that’s usually sent back to the utility company.) With the Roxbury condos, buyers could opt to buy a proportional interest in a solar photovoltaic system and not just achieve net zero but, with state energy incentives, receive checks from the utility that offset the condo association fees.

“We were competing against new construction down the street listed at $375 per square foot,” explains Foley. “We were going on the market at $450 a square foot. We and the developer were very nervous about that — no question. We sold all four of our units before two of the seven units down the street sold — and our units appraised out.

“That’s clear evidence that people were speaking with their wallets in the purchase of the home,” he argues. “We were offering great, durable buildings with no operating costs.”

The more consumers know....

Educating consumers on the long-term benefits — not just financially, but environmentally and in terms of home durability in extreme weather — is where real estate and other industry professionals can play a key role in propelling more growth.

“Zero-energy homes reduce their operating costs by as much as $100,000 over a 30-year mortgage,” says Herro. “Banks need to acknowledge that value, and agents need to help people understand the differences between an old home, a new home, and a high-performance home.

“France has adopted a total-cost model,” he adds. “It discloses how much the home is selling for and then how much it costs to operate. That model is one of the keys to getting the industry to evolve. We’ve been trying to push for mortgage reform and national labeling standards around operating costs.”

Foley also believes real estate agents are critical to building more homes that consume less energy and better weather the elements. “We’re on a threshold right now, and all of this is moving very rapidly,” he says. “Half of one percent of REALTORS® have their GREEN designation. That’s ridiculous to me. Every real estate team in the United States should have a GREEN-designated agent. A requirement to be on our team is to have that designation. The opportunity is huge for REALTORS® to really engage this part of the marketplace right now.”

If they do, Foley contends, they can make an impact that will last long after they’re gone. “There are some really passionate people here — architects, builders, and others who’ve been at the leading edge,” he says. “They understand there’s a climate problem, and they want to do well and to do good. That will be their legacy.”

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The Continued Greening of NAR's Washington Building

You may have heard about the most visible example of the NATIONAL ASSOCIATION OF REALTORS®’ leadership on the sustainability front — its Washington, D.C., headquarters.

A shot of the DC NAR building and its green glass facade with the Capitol building in the background

A refresher, in case you don’t recall the details: When it opened in 2004, the building earned LEED Silver BD+C rating for new construction. At the time, it was the first building in the District of Columbia to receive that LEED designation, which it will forever carry.

Once a building is operational, achieving new LEED certification gets more challenging. NAR, however, has met the challenge both times certification was on the table since the building opened. It was first awarded LEED Gold Existing Building Operating and Maintenance, or EB O+M, in 2009, based on a number of sustainability factors, including its use of renewable energy purchase agreements since the building opened. Those agreements allow NAR to offset its energy use by encouraging the development of alternative sources of energy elsewhere — in NAR’s case, the alternative source it’s encouraging is wind power.

The DC NAR building lobby area

That designation expires after so many years, and the LEED program is designed to push building owners into greater and greater sustainability to continue qualifying.

When it came time for NAR to requalify in 2017, it went one better. In February of that year, it achieved the highest level for EB O+M: Platinum.

Today, the building is about midway through the recertification period, and Brad Clark, senior property manager at Cushman & Wakefield, which manages the building, is totally on it.

The square in front of the north side of the NAR building in DC

“The key for this building is energy use,” he says. “Currently, we’re researching how we’re going to be able to be more energy efficient. That will be critical to any recertification.

“The way you’re evaluated on energy efficiency in the LEED certification program is through the Energy Star score,” he explains. “It’s a U.S. Department of Energy scorecard of a building’s energy usage. You have to be in the top 25 percent of all buildings for energy efficiency to qualify for LEED certification.

“But it’s gotten to the point that everybody’s energy efficient today, and they had to make the program tougher,” says Clark. “Now we don’t even have Energy Star certification because it’s become so much more rigorous. The best way for us to regain that is with our HVAC system, which is 15 years old, anyway. Some components will get replaced, and some will get upgraded.”

The fountain on the north side of the NAR building in DC

Clark, however, is thinking much bigger. “NAR loves to stay on the forefront, so we’re also looking at being the first Washington, D.C., commercial office building to use geothermal energy,” he reports. “It’s feasible, but there are some complications. We’re currently evaluating whether it’s workable. I hope we’ll know that by the
end of this year.”

Going geothermal will pay for itself over time, with Clark’s preliminary calculations reflecting a 20-year payback period. “That’s typically beyond most owners’ desire, but NAR isn’t the typical building owner,” he says. “NAR seemed to be very excited about the possibility of having that technology feather in its cap.”

If geothermal isn’t workable, Clark’s Plan B will come into play. “That’s looking at the cost of replacing most or all of our air handling units on each floor,” he says. “That will upgrade the HVAC equipment’s efficiency and provide more tenant comfort.”

Roof terrace at the NAR building in DC

Solar was a consideration, but Clark says it’s not a particularly good option for NAR because the building doesn’t have the roof space necessary for solar panel installation. “We might be able to incorporate it into a roof terrace improvement — maybe the canopy serves as a roof for patrons, and that would have some solar panels on it,” he muses. “That’s one idea I have. We already have money in the budget in the next 10 years to redo the roof terrace. It’s old and dated, and we have to stay ahead of other Class A buildings here. That’s where we can improve efficiency and improve the roof terrace.”

There’s also capital improvement money budgeted for a 10-year shift to entirely LED lighting, which has already begun.

Whatever path NAR opts to follow, Clark is confident its building will again earn LEED EB O+M Platinum certification in 2022. Frankly, he appreciates the challenge and the opportunity NAR offers him to stretch himself professionally.

“I consider myself lucky I have NAR as my client,” he says. “I go to NAR’s Real Property Operations committee, which oversees me, and they’re the ones who are very, very receptive to my new ideas — and they’re the ones who have to sell those ideas to leadership and members. To have a client who’s so dedicated to keeping its building at the forefront of marketplace is really great — no question.”

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About On Common Ground

A free, semi-annual magazine published by NAR, On Common Ground presents a wide range of views on smart growth issues, with the goal of encouraging dialog among REALTORS®, elected officials, and other interested citizens.

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