Green Building in North Carolina Chad Ray Karin Argeris.

Green BuildingGreen Buildingin North Carolinain North Carolina

Chad RayChad Ray

Karin ArgerisKarin Argeris

Green Building in NCGreen Building in NCwww.raleighquickappraisals.comwww.raleighquickappraisals.com

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Today’s AgendaToday’s Agenda

• Green Construction ConceptsGreen Construction Concepts– Green Pillars; 6 Integrated Systems

• Construction Considerations• Cost/Pricing Impact

– Consumer Benefits

– Objective Documentation


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Today’s AgendaToday’s Agenda

• Green Appraisal ConceptsGreen Appraisal Concepts– Valuation Considerations

• Operating Costs• Quality of Construction

– Information Sources (Comps)

– Quick Turn Approaches

Green Construction ConceptsGreen Construction Concepts

Chad RayChad RayOlde Heritage BuildersOlde Heritage Builders


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NGBS Green PillarsNGBS Green Pillars6 Integrated Systems6 Integrated Systems

Lot Design, Preparation, and DevelopmentLot Design, Preparation, and DevelopmentResource EfficiencyResource EfficiencyEnergy EfficiencyEnergy EfficiencyWater EfficiencyWater Efficiency

Indoor Environmental QualityIndoor Environmental QualityHomeowner EducationHomeowner Education


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• Lot Design, Preparation, DevelopmentLot Design, Preparation, Development

– Key Elements

– Construction Considerations

– Cost Impacts: Labor/Materials

– Pricing Impact


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• Resource EfficiencyResource Efficiency

– Key Elements



– Pricing Impact


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• Energy EfficiencyEnergy Efficiency

– Key Elements



– Pricing Impact


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• Indoor Environmental QualityIndoor Environmental Quality

– Key Elements



– Pricing Impact


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Green Construction ConceptsGreen Construction Concepts• Homeowner EducationHomeowner Education

– Key Elements



– Pricing Impact


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• Consumer BenefitsConsumer Benefits

– Savings

– Health

– Comfort

– Resale


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• Objective Documentation ProducedObjective Documentation Produced

– Plans/Specs

– HERS Rating

– NGBS Calculator Results

– Certification Level


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Green Construction ConceptsGreen Construction ConceptsNGBS CALCULATOR - BRONZENGBS CALCULATOR - BRONZE

ChapterRequired

PointsClaimed Points

Additional Claimed Points Above Bronze

Point Shortfall

Mandatory Status

Chapter 5: Lot Design, Preparation, & Development 39 0 (39) 0Chapter 6: Resource Efficiency 45 0 (45) 0

Chapter 7: Energy Efficiency 30 0 (30) 0Chapter 8: Water Efficiency 14 0 (14) 0

Chapter 9: Indoor Environmental Quality 36 0 (36) 0Chapter 10: Operation, Maintenance, & Building Owner

Education 8 0 (8) 0

Section Totals 172 0 0 (172)

Additional Points Above Bronze 50 0 (50)

Total Points 222 0 (222)

* Reach required Bronze score for each chapter

* Reach required Additional Points for this project

* Meet all mandatory items

* For Chapter 7: Energy Efficiency:~ Claim at least 30 points from Section 702 (Performance Path) or Section 703 (Prescriptive Path) and select a

minimum of 2 items from Section 704, OR~ Choose the Alternative Bronze Compliance Path

This requirement has not been met yet.

You have not met any energy path minimum points requirements yet.You have not met the minimum 2 required items from Section 704.

Bronze

To achieve Bronze:This requirement has not been met yet.This requirement has not been met yet.

Green Appraisal ConceptsGreen Appraisal Concepts

Karin ArgerisKarin ArgerisQuick Turn Quality Appraisals, LLCQuick Turn Quality Appraisals, LLC


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• Green Adds ValueGreen Adds Value

– Operating Costs• Energy Consumption

– Quality of Construction• On-going Maintenance• Durability/Effective Age• Resale Value


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HERS – Rating BenchmarksHERS – Rating Benchmarks

$Energy

Star

2006 Energy Code

Conventional Construction

Pre-2006 HERSHERS

100100

HERSHERS

8585`

ENERGY

USAGE

ENERGY

COST

TraditionalConstruction

Improved Framing & Materials

Energy Efficient Technologies

HERS 115+HERS 115+


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Green Value AddedGreen Value Added

VALUEVALUE Water EfficiencyWater Efficiency

Resource Resource EfficiencyEfficiency

Lot DesignLot Design

OperationOperation

Indoor Air Indoor Air QualityQuality

Energy Energy EfficiencyEfficiency

Materials &Materials &

FramingFraming

Traditional Traditional TechniquesTechniques

EnergyStar Certified

Traditionally Built Home

CertifiedHi-Performance

Home

Built to 2006 Code

HERS < 85

HERS = 85

HERS = 100

HERS = 125


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• Valuation ConsiderationsValuation Considerations

– Operating Costs• Energy Consumption• On-going Maintenance

– Quality of Construction• Durability/Effective Age• Resale Value


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Green Appraisal ConceptsGreen Appraisal Concepts• Comps – Information SourcesComps – Information Sources

– MLS/Realtor – Inconsistent, Searchable• Certifications• HERS Rating

– Builder/Verifier – Reliable, Non-Searchable• Green Calculator Scores• HERS Rating

– Public Records• ?


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• Quick Turn: Valuation ApproachesQuick Turn: Valuation Approaches– Preliminary

• No Official Guidance

• Based on Fannie Mae Approach

– Adjustments• Energy Efficiency

• Quality of Construction


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• Quick Turn: Valuation ApproachesQuick Turn: Valuation Approaches– Energy Efficiency Adjustments

• Estimate Energy Savings– Based on HERS Rating Differential

• Savings Value - Capitalized– Additional Mortgage Capacity

• Savings Value - Gross Rent Multiplier– Market Value of Additional “Rent”


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Energy Efficiency Adjustments - ExampleEnergy Efficiency Adjustments - Example

Expected Mortgage Rate 4.875%

Current Monthly Energy Bill 125$ <1980 1980-99 2000-05 >2005

Gross Rent Multiplier 169 125 115 110 100

SUBJECT Comp 1 Comp 2 Comp 3 Comp 4 Comp 5 Comp 6

Year Built 2010 2005 2008 2010 2010 2010 2007

HERS Rating 83 110 100 100 75 62 100

Estimated Monthly Energy Savings 31$ 21$ 21$ (13)$ (42)$ 21$

Additional Capitalized Savings Value 5,800$ 4,000$ 4,000$ (2,500)$ (8,000)$ 4,000$

Additional GRM Value 5,185$ 3,591$ 3,591$ (2,253)$ (7,155)$ 3,591$

PURCHASE COMPSDefault HERS Rating By Year Built


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• Quick Turn: Valuation ApproachesQuick Turn: Valuation Approaches– Quality of Construction

• Reduced Non-Energy Costs– Adjust by Certification Level

» General: 1% per Level

• Reduced Effective Age• Resale

– Quantitative Data Limited

Green Building in North Carolina Chad Ray Karin Argeris.

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