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Who’s Building HERS® Rated Homes?

Nov 16, 2019

by Ryan Meres, RESNET Program Director

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 2019 Top 200 list to see how many were getting their homes HERS Rated.

Builder’s top 200 list spans an array of builders that closed as few as 161 homes and as many as 52,000 in 2018. In total, these 200 builders closed in excess of 302,000 homes.

RESNET’s analysis has found:

  • Of those 302,000+ homes, 54 percent received a RESNET HERS Index Score
  • One hundred forty (140) of the 200 builders chose to have their homes HERS Rated (As did 80 of the top 100 builders)
  • One-fourth (¼) of the Top 200 builders received RESNET HERS Index Scores on nearly 100 percent of the homes closed in 2018

The 18 publicly traded building companies (with 2018 combined revenues of $90 billion+) on the top 200 list were responsible for more than 75,000 HERS Ratings in 2018. That amounts to one-third of their total closings last year. Perhaps an even more interesting statistic is that only one of these publicly traded companies did not receive HERS Ratings on any of their homes in 2018; while six of them chose to receive HERS Ratings on nearly 100% of their homes.

It is thought that much of the disparity in the number of ratings versus the number of closings among some of these big builders is due to the authority given to their local and regional divisions. Some divisions choose to do HERS Ratings in their markets, while others do not.

In 2018, RESNET recorded just over 236,000 HERS Rated homes by a little more than 4,000 home building, remodeling and development companies. Around 10 percent of those companies recorded 51 or more ratings, while the rest recorded fewer than 50 HERS ratings. The top builder by the number of ratings had more than 17,000 ratings completed in 2018. When we look at the top 20 builders by the number of ratings, we see that they ordered more than 98,000 ratings, accounting for almost half of those builders’ total closings.

The following are the top 20 builders in terms of whose homes were HERS rated and entered into the RESNET registry in 2018:

  1. NVR
  2. Lennar Corp
  3. KB Home
  4. R. Horton
  5. Meritage Homes
  6. Pulte Group
  7. MDC Holdings
  8. M/I Homes
  9. Beazer Homes
  10. Taylor Morrison
  11. Highland Homes
  12. Hovnanian Enterprises
  13. Mattamy Homes
  14. Ashton Woods Homes
  15. David Weekley Homes
  16. Mungo Homes
  17. Shea Homes
  18. TRI Pointe Group
  19. True Homes
  20. Toll Brothers

RESNET’s new Builder of the Month feature makes it clear that builders of all sizes see the benefits of getting their homes HERS Rated. The first two builders included in this feature are KB Home and Imery Group. Both of these builders get all of their homes HERS Rated. KB Home is a publicly-traded company and ranked 5th on the 2019 Builder Top 100 list; while Imery Group is a small custom builder, building less than a half dozen homes per year in Georgia.

When asked about the value of the HERS Index to customers in the Builder of the Month feature, Jacob Atalla, VP of Sustainability Initiatives for KB Home said, “The HERS Index is designed to educate homeowners and prospective buyers about the relative energy efficiency of a home. This information allows our customers to better understand the overall cost of homeownership.”

Luis Imery, founder and owner of Imery Group, had this to say about why his company gets their homes HERS Rated: “A HERS rated home brings validity to our quality brand. We are not only saying we deliver healthy, durable, efficient, and comfortable homes with one of a kind warranty, but they are verified.”

Overall, this analysis shows that even though the majority of the 18 publicly traded builders and thousands of private builders choose to get HERS Ratings for their homes, there is still much room for growth. RESNET has more work to do to promote the value of HERS Ratings among builders, consumers, and the real estate community. With our recently launched 2019 marketing campaign, we plan to do just that, with an updated consumer website (www.hersindex.com) and targeted paid social media advertising to place the HERS brand in front of consumers who have already digitally expressed an interest in the home-buying process. This consumer advertising campaign is being piloted in the Austin, TX and Washington, DC markets based on demographic and market research. In addition, RESNET is doing more to engage with builders, realtors, appraisers, and others via partnerships and industry related events. RESNET is collecting the analytics of the activities and will evaluate the effort at the end of the pilot campaign. Depending on the results, the campaign may be expanded to other targeted markets.

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