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The Nation’s Big Builders Drive Up HERS Ratings in 2020

Jun 24, 2021

Each year, Builder releases its list of the top 200 builders from the previous year. These builders are ranked by the number of closings they had in a calendar year. RESNET undertook an analysis of Builder’s Top 200 list to see how many were getting their homes HERS Rated.

Who is building HERS rated homes.
Builder’s top 200 list spans an array of builders that closed as few as 190 homes to more than 71,000 in 2020. In total, these 200 builders closed more than 441,000 homes.

  • Of those 441,000+ homes, 43 percent received a RESNET HERS Index Score, a 4 percent jump over last year.
  • 135 of the 200 builders chose to have their homes HERS Rated
  • 85 of the top 100 builders chose to have their homes HERS Rated

The 19 publicly traded building companies on the top 200 list were responsible for nearly 127,000 HERS Ratings in 2020 (compared to 96,847 in 2019). That amounts to forty-seven percent of their total closings last year, a 7 percent jump over 2019.

The importance of HERS Ratings to publicly traded builders has been increasing as investors look more at environmental, social and governance (ESG) factors in their investment decisions. Morgan Stanley’s Institute for Sustainable Investing found that 95 percent of millennials are interested in sustainable investing and 85 percent believe their investment decisions can influence the amount of climate change caused by human activities. This is important because millennials are now the largest generation of homebuyers.

The Sustainability Accounting Standards Board (SASB) has a corporate reporting standard specifically for the homebuilding industry. In its standard, SASB recommends that builders report on the number of homes they had HERS Rated, the average HERS Index score and how many ENERGY STAR homes they certified. All this data is readily available to builders of HERS Rated homes. RESNET’s National Registry houses all HERS Ratings completed since 2013.

In 2020, RESNET recorded 299,755 HERS Ratings by more than 10,000 home building, remodeling and development companies (compared to more than 6,000 in 2019). Just over six hundred builders recorded 50 or more ratings, while the rest recorded fewer than 50. The top builder by number of ratings, registered more than 25,000 in 2020. When we look at the top 20 builders by number of ratings, we see that they ordered more than 143,000 ratings, accounting for 48 percent of all ratings last year (compared to 43 percent in 2019).

Below is a list of the top 20 builders with the most HERS Rated homes in 2020 (in alphabetical order). Not all builders on this list report closings for the Top 200 Builder List.

·       Beazer Homes (p)
·       Century Communities (p)
·       Clayton Properties Group
·       David Weekley Homes
·       D.R. Horton (p)
·       Express Homes
·       Highland Homes
·       Hovnanian Enterprises (p)
·       KB Home (p)
·       Lennar Homes (p)
·       Mattamy Homes
·       Meritage Homes (p)
·       M/I Homes (p)
·       NVR (p)
·       Perry Homes
·       PulteGroup (p)
·       Richmond American Homes (p) (M.D.C. Holdings)
·       Stanley Martin Homes
·       Taylor Morrison (p)
·       Toll Brothers (p)

(p) = publicly traded builder.

Even though large national and regional builders are recording thousands of HERS ratings each year, there are thousands of smaller, local builders also doing ratings. In 2020 more than two-thirds of all builders doing HERS Ratings registered three or fewer ratings.

For more information, visit www.resnet.us and www.hersindex.com