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Understanding Home Energy Performance Will Become a Key to Real Estate Success

Real estate professionals should enhance their home energy performance capabilities in today’s evolving residential market, or risk falling behind those who do

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For sale: Home energy performance is too often overlooked by buyers and sellers during property transactions, with buyers often lacking easy access to the information.
Image Credit: Dan Moyle / CC BY 2.0 / Flickr
For sale: Home energy performance is too often overlooked by buyers and sellers during property transactions, with buyers often lacking easy access to the information.
Image Credit: Dan Moyle /
CC BY 2.0 / Flickr RMI in partnership with the National Environmental Education Foundation developed this graphic outlining how home energy performance can aid home sales.


Real estate professionals play a pivotal role in the U.S. residential real estate market. Overseeing from start to finish the multiple steps and piles of paperwork involved with property transactions, they support both sellers moving forward with the next stage of their lives and buyers looking for a new place to call home. They provide trusted and influential guidance that affects the largest investment that most of us will ever make: our homes.

Home energy performance is too often overlooked by buyers and sellers during property transactions, and buyers seldom have easy access to energy performance information. Even though U.S. homeowners spend on average about $2,200 per year on energy bills and increasingly indicate demand for energy-efficient homes, real estate professionals generally undersell (or are unaware of) the benefits of homes with strong energy performance.

These benefits include improved comfort, health, privacy, programmability, and interconnectivity, as well as increased monthly affordability and — where relevant information is made available — resale value. Moreover, U.S. real estate listings generally lack details about a property’s energy performance, energy-efficient features, and estimated utility costs. This omission contributes to the unnecessary perpetuation of the invisibility of home energy upgrade investments, housing dissatisfaction, underinvestment in home energy upgrades, plateauing residential energy savings, and risks to U.S. real estate market stability.

Opportunity is calling for all real estate professionals to tap the promising U.S home energy upgrades market by helping clients understand, prioritize, and invest in home energy performance during the property transaction process — when buyers and sellers already tend to make general home improvements. Real estate professionals who enhance their home energy performance capabilities can lead their competitors on market trends and improve the long-term prospects of their business.

Changing consumer demands

Real estate professionals are under pressure to accommodate various evolving market trends. Consumer preferences are diverging based on generation, with baby boomers looking to age in place and millennials becoming the largest share of home buyers with their own demands. Numerous residential energy technologies — including rooftop solar, LED lighting, programmable thermostats and appliances, heat pumps, and battery storage — are becoming commonplace and sought-after in homes.

State and local governments are also increasing standards for energy performance for new and existing homes. For example, California has a statewide goal for all new residential construction to achieve zero net energy status by 2020.

Real estate professionals can embrace and profit from these market trends by making home energy performance a core component of the support they provide for buyers and sellers. Those who help clients identify where to start, which home energy upgrades can deliver the most value, and how to showcase these upgrades during property sales will be better situated to meet emerging consumer demands and ride the wave of market trends for profit. As such, real estate professionals who ignore insights about where the market is heading and fail to build their own energy performance capabilities should expect to fall behind.

Using home energy performance to get ahead

In the rapidly evolving U.S. residential market, real estate professionals can leverage home energy performance to achieve faster closing times and higher closing rates, larger commissions, and greater competitive advantage.

To encourage and empower U.S. real estate professionals to understand and promote the multiple benefits of homes with strong energy performance, Rocky Mountain Institute’s Residential Energy+ team developed the “Home Heroes” infographic in partnership with the National Environmental Education Foundation (NEEF) — a congressionally chartered organization with a vision to have 300 million Americans actively use environmental knowledge by 2022 (see Image #2, below).

This shareable education tool describes how real estate professionals can support home buyers and sellers in the pursuit of homes that are better for their families, their pocketbooks, and the environment in order to gain competitive advantage in a real estate market that’s evolving to meet changing customer demands. More specifically, the tool links to leading research about the ways that real estate professionals can gain from making energy performance central to the support they provide buyers and sellers, along with specific actions they can take to better support their clients.

Gaining a green credentials advantage

Real estate professionals with green credentials — namely, the National Association of Realtors Green Designation—maintain a higher standard of support for buyers and sellers. They understand why energy performance matters. They also know how to implement green data entry fields on multiple listing service (MLS) systems, promote the benefits of energy-efficient features, get enhanced property valuations from appraisers with sustainability credentials, and use energy performance to differentiate among properties.

Until home energy performance capabilities become a general industry standard for real estate professionals, green credentials like the Realtors Green Designation offer a useful indicator for buyers and sellers seeking higher quality support and better outcomes during real estate transactions. Buyers and sellers who want homes delivering greater comfort, health, resale value, and affordability for their families should therefore seek out real estate professionals with such credentials.

As more buyers and sellers seek the benefits that high-performance homes deliver and expect assistance finding them during the property transaction process, real estate professionals who embrace market trends and take the initiative today to make home energy performance central to their client support will be in an advantageous position to harness the markets of tomorrow.

© 2017 Rocky Mountain Institute. Published with permission. Originally posted on RMI Outlet.


  1. Expert Member

    This is the second piece of absolute fluff to come out of the Rocky Mountain Institute in the last few months. That's worrying.

  2. Paul Eldrenkamp | | #2

    Upton Sinclair
    When I think of real estate agents discussing energy performance of the homes they represent I'm reminded of the Upton Sinclair quote: "It is difficult to get a man to understand something, when his salary depends upon his not understanding it!"

  3. watercop | | #3

    Smoking Hopium?
    I'm with Malcolm and Upton...

    Realtors are enslaved by the transaction - get all parties to the settlement table ready to sign and swap checks. The last thing they want is to get bogged down in a murky discussion about home energy conservation, or, worse yet, building science.

    Maybe RMI needs to revisit its drug this case test for "Hopium"

  4. Robert Opaluch | | #4

    Fact-based estimated utility costs in real estate listings?
    Buyers need honest, objective information on the energy efficiency of specific homes they are considering for purchase. If estimated mortgage, taxes and insurance payments also had estimated utilities payments, that might help. Maybe HERS rating could be used to estimate heating and cooling loads, what else? For existing homes, utility bills seem too dependent upon occupant behavior, and are not publicly available.

  5. Jon_R | | #5

    I expect that most agents are
    I expect that most agents are aware of energy efficiency as a selling point. And any prospective buyer or lender should hire an independent Manual J or energy audit to confirm the claims.

  6. watercop | | #6

    Energy Efficiency IS a selling point...
    However, a Man J or an energy audit rarely reveals information likely to speed the parties to the settlement table...

  7. JC72 | | #7

    In my area.
    Realtors will market a home if it came with a "green" rating/Cert such as LEED, Earthcraft, EnergyStar, and sometimes HERS (Relegated to tact houses).

  8. Jeff_Gephart | | #8

    A Blueprint for Real Estate Market Transformation
    In Vermont we are working with some success through a collaborative of building, real estate, and lending trade organizations to transform the real estate market so that buyers and sellers can identify and accurately value energy efficiency and renewable energy benefits.

    We are implementing the Visible Value Blueprint: 7 Steps:
    1) Document energy efficiency features and improvements using consistent, standardized methods.
    2) Disclose inventories of energy efficient homes to track supply.
    3) Capitalize on existing [and/or create] high-quality continuing education and designation training.
    4) Work with the MLS community to ensure that data about home energy efficiency improvements are incorporated into for-sale listings.
    5) Ensure that the data about home energy efficiency improvements are incorporated into the appraisal process.
    6) Develop standards and IT solutions that allow quicker, more accurate, automated transfer of data.
    7) Work with partner financial institutions to ensure selection of qualified appraisers.

    This Blueprint can be found in Unlocking the Value of an Energy Efficient Home:

  9. GreenBuildingAdvisor | | #9

    This insightful article emphasizes the crucial role of real estate professionals in recognizing and promoting home energy performance. The author effectively highlights the often-overlooked benefits, such as improved comfort and affordability, while pointing out the current lack of information available to buyers. The call for real estate professionals to enhance their understanding of energy performance aligns with the evolving market trends and changing consumer demands, positioning them for future success. The "Home Heroes" infographic provides a practical tool for real estate professionals to navigate this shift, making it a valuable resource. The emphasis on green credentials, specifically the Realtors Green Designation, adds credibility to professionals who prioritize energy efficiency. Overall, the article admirably guides real estate professionals toward embracing market trends, ensuring they stay ahead in a rapidly evolving industry. Thanks for shedding light on this essential aspect of the real estate market.
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