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Community and Q&A

Refinance & Appraisal on Historic Net Zero Home

Matthew Grocoff | Posted in General Questions on

You’ve heard this before . . . no comps, no deal.

We’re refinancing our 111-year-old net zero energy home. At my request the appraiser used PV Value and included the Appraisal Institute Green Addendum. He valued the home added $40-50k to the home for all the “green” features (including geothermal and 8.1kw solar resulting in net positive energy production over any rolling 12 month period). See GBA case study about home: https://www.greenbuildingadvisor.com/homes/mission-zero-house-net-zero-retrofit.

Our local bank is concerned that the large “adjustments” will be reduced by the underwriter because there are no comps for such features. Considering we are the only documented net zero home in the state of Michigan, he’s right – there are no comps. As for LEED homes and other green certified homes, while there are several in the area none have gone up for sale . . . ever. People buy them and keep them. One is for sale now at double the price of our appraisal (it’s a new build).

Further, we have a contract with our utility company for RECs over 20 years – totaling about $1,100 per year. That of course is an objective number in addition to the value added by PV Value (Sandia Labs).

Question: Is there anything that we can do proactively to guide the underwriter in the right direction? The bank is taking a wait-and-see approach. I fear that once the underwriter comes back and says, “show me some comps” then our refi is dead. PV Value is specifically designed to provide objective data when no comps exists. If they don’t understand PV Value – there’s not much we can do after-the-fact.

Any suggestions? This is a landmark situation here. I’d like to see our home continue as an example of

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Replies

  1. Mike Collignon | | #1

    Once the SAVE Act gets enacted, you'd have some assistance on this.

    Unfortunately, the National Association of Realtors is hell-bent on making sure that doesn't happen. Since they are a powerful lobby, the legislation isn't going anywhere until post-Jan. 20, 2013 at the earliest.

    Wish I had better news for you.

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