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Home Energy Score will change real estate, again

Remember those stickers on every new car in the sales lot — the ones touting the fuel economy?
Now imagine one on the front door of every home for sale.
No, it’s not a fantasy. It’s a coming reality.

The U.S. Department of Energy in November released a long-anticipated pilot program for formal testing in 10 U.S. locations. The program, called Home Energy Score, signals the dawn of a new era of energy awareness in the real estate industry.

Some of you might remember the dawn of the era of home inspections in the 1970s as homebuyers and real estate agents began hiring contractors to verify the condition of homes before purchase. The increasing public awareness of potential home defects and the desire for liability management by the real estate industry caused the spontaneous creation of an entire class of business: the home inspector. Today, few can imagine entering into a purchase agreement without the benefit of a home inspection.

For the past 10 years, another industry has been quietly gathering steam: the home energy auditor. With increasing public awareness of the economic and environmental ramifications of poorly performing buildings, these auditors are finding a friendly reception by government and educated homeowners.

The primary tools in the home energy auditor’s toolbox are the Home Energy Score, or HERS, evaluative software and the boots-on-the-ground diagnostic equipment to analyze a home’s relative weak points. In Central Pennsylvania, there already are several companies offering energy audits.

With the advent of a national home energy scoring tool, this industry will come into its own. We will see the inclusion of home energy audits and energy scores into the real estate transaction within five years, maybe three.

Just as home inspections inevitably burgeoned and became a bargaining chip for buyers, I envision the Home Energy Score to also become a point of negotiations over price and repairs.

Change is inevitable. Remember the fuel economy stickers on cars? No one debates anymore (if they ever did) whether they are a good thing — a prospective auto buyer wouldn’t have it any other way.

With the U.S. Energy Department’s full rollout of the Home Energy Score this summer, expect to see energy labels on homes within just a few years and energy-efficiency components added to the real estate purchase process. And within a few more years, homebuyers will wonder how people did without for so long.

Are you building or renovating a home to high-performance/green principles? Or have you already done so?

Jeff Geoghan is a residential real estate agent and founder of the Jeff Geoghan Realty Group in Lancaster County. He also hosts “YourLancasterHomeTV.” He holds a freen designation from the National Association of Realtors and blogs about homes and green issues.

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