Home Energy Ratings: A Primer

How the Housing Industry Uses Home Energy Ratings

Consumers

  • Determine the relative energy efficiency of a residence when purchasing a home.
  • Make educated decisions when investing in cost-effective energy improvements to the home.
  • Add the cost of making the energy improvements to the mortgage loan through an energy improvement mortgage.
  • Qualify for a higher quality, energy efficient home.

Builders:

  • Market the energy efficient features of a home.
  • Qualify more potential home buyers for the home.
  • Finance the energy efficient features exceeding code through the FHA Energy Efficient Mortgage Program.
  • Demonstrate compliance to state energy codes.

Real Estate Agents:

  • Present information on the energy efficiency of a home in non-technical and easily understandable terms (Star rating).
  • Market the energy efficient features of the homes they are selling.
  • Identify energy efficient homes on the market for their clients through the Multiple Listing Service.
  • Mitigate the lower selling price of inefficient, existing homes through energy improvement mortgages.
  • Receive accredited training to recognize and market the energy efficiency of a home for state occupational licensing requirements.

Lenders:

  • Present information on the energy efficiency of a home in non-technical and easily understandable terms (Star rating).
  • Determine the relative energy efficiency of the home being financed.
  • Increase confidence in the home's marketability in case of default.
  • Participate in energy mortgage programs.
  • Receive Community Reinvestment Act credits.

Appraisers:

  • Present information on the energy efficiency of a home in non-technical and easily understandable terms (Star rating).
  • Verify a home's relative energy efficiency through an independent source.
  • Factor a home's energy efficiency into the appraisal.
  • Have access to a statewide data base for comparing market data on homes according to their relative energy efficiency.
  • Receive accredited training on valuing the energy efficient features of a home in the appraisal for state occupational license requirements.

Public Housing Authorities/Affordable Housing Programs:

  • Identify cost-effective improvements to the housing stock.
  • Document energy efficient improvements to housing.

Utilities:

  • Is cost-effective method to deliver residential energy efficiency programs to all classes of consumers.