Do Buyers Really Want ‘Green’ Homes?

More than 65 percent of homebuyers recently surveyed say they desire an "environment friendly" home, but only about 15 percent are willing to pay more for a home with such features, according to the National Association of Home Builders' (NAHB) "What Home Buyers Really Want: Ethnic Preferences" study. The study found that energy efficiency was a top priority across races and ethnicities.

But when NAHB changed the way the question was phrased to emphasize the benefits of environmentally friendly features in trimming utility bills, more buyers said they were willing to pay for it.

In the survey, buyers were asked to choose between a highly energy efficient home that saved 2 to 3 percent on utility bills over the life of the home versus a home without those features. When couched as a long-term savings, more than 80 percent of buyers preferred the more expensive energy-saving home.

The NAHB survey looked at ethnic differences in green housing preferences. Whites, on average, would pay $6,774 more for a home with energy efficiency features that lower utility bills; African American buyers are willing to pay $7,578 more; and Asian buyers will pay $8,251 more.

Hispanic buyers were willing to pay the most – an average of $9,146 more for a home with such features, according to the survey.

Source: "What Home Buyers Really Want: Ethnic Preferences (Part IV)," National Association of Home Builders' Eye on Housing Blog (April 3, 2014)

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