Green Building
in North Carolina
Chad Ray
Karin Argeris
Today’s Agenda
• Green Construction Concepts
– Green Pillars; 6 Integrated Systems
• Construction Considerations
• Cost/Pricing Impact
– Consumer Benefits
– Objective Documentation
Green Building in NC
www.raleighquickappraisals.com
2
©2010 QTQA, LLC
Today’s Agenda
• Green Appraisal Concepts
– Valuation Considerations
• Operating Costs
• Quality of Construction
– Information Sources (Comps)
– Quick Turn Approaches
Green Building in NC
www.raleighquickappraisals.com
3
©2010 QTQA, LLC
Green Construction Concepts
Chad Ray
Olde Heritage Builders
Green Construction Concepts
NGBS Green Pillars
6 Integrated Systems
Lot Design, Preparation, and Development
Resource Efficiency
Energy Efficiency
Water Efficiency
Indoor Environmental Quality
Homeowner Education
Green Building in NC
www.raleighquickappraisals.com
5
©2010 QTQA, LLC
Green Construction Concepts
• Lot Design, Preparation, Development
– Key Elements
– Construction Considerations
– Cost Impacts: Labor/Materials
– Pricing Impact
Green Building in NC
www.raleighquickappraisals.com
6
©2010 QTQA, LLC
Green Construction Concepts
• Resource Efficiency
– Key Elements
– Construction Considerations
– Cost Impacts: Labor/Materials
– Pricing Impact
Green Building in NC
www.raleighquickappraisals.com
7
©2010 QTQA, LLC
Green Construction Concepts
• Energy Efficiency
– Key Elements
– Construction Considerations
– Cost Impacts: Labor/Materials
– Pricing Impact
Green Building in NC
www.raleighquickappraisals.com
8
©2010 QTQA, LLC
Green Construction Concepts
• Indoor Environmental Quality
– Key Elements
– Construction Considerations
– Cost Impacts: Labor/Materials
– Pricing Impact
Green Building in NC
www.raleighquickappraisals.com
9
©2010 QTQA, LLC
Green Construction Concepts
• Homeowner Education
– Key Elements
– Construction Considerations
– Cost Impacts: Labor/Materials
– Pricing Impact
Green Building in NC
www.raleighquickappraisals.com
10
©2010 QTQA, LLC
Green Construction Concepts
• Consumer Benefits
– Savings
– Health
– Comfort
– Resale
Green Building in NC
www.raleighquickappraisals.com
11
©2010 QTQA, LLC
Green Construction Concepts
• Objective Documentation Produced
– Plans/Specs
– HERS Rating
– NGBS Calculator Results
– Certification Level
Green Building in NC
www.raleighquickappraisals.com
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Green Construction Concepts
NGBS CALCULATOR - BRONZE
Bronze
Required
Points
Chapter
Claimed
Points
Additional Claimed
Points Above Bronze
Point
Shortfall
Mandatory
Status
Chapter 5: Lot Design, Preparation, & Development
Chapter 6: Resource Efficiency
Chapter 7: Energy Efficiency
Chapter 8: Water Efficiency
Chapter 9: Indoor Environmental Quality
Chapter 10: Operation, Maintenance, & Building Owner
Education
39
45
30
14
36
0
0
0
0
0
(39)
(45)
(30)
(14)
(36)
8
0
(8)
Section Totals
Additional Points Above Bronze
Total Points
172
50
0
222
0
0
0
(172)
(50)
(222)
To achieve Bronze:
* 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.
This requirement has not been met yet.
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.
Green Building in NC
www.raleighquickappraisals.com
13
©2010 QTQA, LLC
0
0
0
0
0
0
Green Appraisal Concepts
Karin Argeris
Quick Turn Quality Appraisals, LLC
Green Appraisal Concepts
• Green Adds Value
– Operating Costs
• Energy Consumption
– Quality of Construction
• On-going Maintenance
• Durability/Effective Age
• Resale Value
Green Building in NC
www.raleighquickappraisals.com
15
©2010 QTQA, LLC
HERS – Rating Benchmarks
HERS 115+
Conventional
Construction
Pre-2006
2006 Energy
Code
ENERGY
` USAGE
ENERGY
HERS
COST
100
$
HERS
85
Energy
Star
Green Building in NC
www.raleighquickappraisals.com
16
©2010 QTQA, LLC
Traditional
Construction
Improved
Framing &
Materials
Energy
Efficient
Technologies
Green Value Added
VALUE
Water Efficiency
Resource
Efficiency
Lot Design
Certified
Hi-Performance
Home HERS < 85
EnergyStar
Certified
Built to 2006 Code
Operation
Indoor Air
Quality
HERS = 85
HERS = 100
Traditionally Built Home
HERS = 125
Green Building in NC
www.raleighquickappraisals.com
17
©2010 QTQA, LLC
Energy
Efficiency
Materials &
Framing
Traditional
Techniques
Green Appraisal Concepts
• Valuation Considerations
– Operating Costs
• Energy Consumption
• On-going Maintenance
– Quality of Construction
• Durability/Effective Age
• Resale Value
Green Building in NC
www.raleighquickappraisals.com
18
©2010 QTQA, LLC
Green Appraisal Concepts
• Comps – Information Sources
– MLS/Realtor – Inconsistent, Searchable
• Certifications
• HERS Rating
– Builder/Verifier – Reliable, Non-Searchable
• Green Calculator Scores
• HERS Rating
– Public Records
•?
Green Building in NC
www.raleighquickappraisals.com
19
©2010 QTQA, LLC
Green Appraisal Concepts
• Quick Turn: Valuation Approaches
– Preliminary
• No Official Guidance
• Based on Fannie Mae Approach
– Adjustments
• Energy Efficiency
• Quality of Construction
Green Building in NC
www.raleighquickappraisals.com
20
©2010 QTQA, LLC
Green Appraisal Concepts
• Quick 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”
Green Building in NC
www.raleighquickappraisals.com
21
©2010 QTQA, LLC
Green Appraisal Concepts
Energy Efficiency Adjustments - Example
PURCHASE COMPS
Expected Mortgage Rate
Current Monthly Energy Bill
Gross Rent Multiplier
4.875%
$
125
169
Default HERS Rating By Year Built
<1980 1980-99 2000-05 >2005
125
115
110
100
SUBJECT Comp 1 Comp 2 Comp 3 Comp 4
Year Built
2010
HERS Rating
Estimated Monthly Energy Savings
83
2005
$
Additional Capitalized Savings Value
Additional GRM Value
2008
110
31 $
$ 5,800
$ 5,185
100
21 $
$ 4,000
$ 3,591
Green Building in NC
www.raleighquickappraisals.com
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©2010 QTQA, LLC
2010
2010
100
21 $
$ 4,000
$ 3,591
Comp 5
75
(13) $
Comp 6
2010
62
(42) $
2007
100
21
$ (2,500) $ (8,000) $ 4,000
$ (2,253) $ (7,155) $ 3,591
Green Appraisal Concepts
• Quick 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 NC
www.raleighquickappraisals.com
23
©2010 QTQA, LLC
Green Appraisal Concepts
Quality Adjustments - Example
Green Building in NC
www.raleighquickappraisals.com
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©2010 QTQA, LLC