Today I spoke at the 2nd Annual Energy Efficiency Summit in Raleigh, presented by The North Carolina Energy Efficiency Alliance. I was part of a panel that included an energy rater, a lender, and a real estate broker. The audience consisted of builders, energy raters, lenders, brokers, policy makers, academia, government representatives, and yes, one other appraiser.
Many folks are pushing to have the consumer understand energy efficiency better in the hopes of being able to “drive” the further acceptance of energy efficiency in the market place. Appraisers, however, need to remember that our job is to stay independent, impartial, and objective and to be ready to analyze the market’s reaction, if any, to energy efficient characteristics. We sit back, watch the market, gather data, analyze data, and give our opinion on how the market will view a particular set of circumstances. It is not our job to “drive” anything. Our job is to develop and report credible assignment results.
Some of the topics raised at the summit include:
Changes in NC building codes and builders building to new standards
Loan programs for energy efficient properties
Adding more data in MLS to describe property features in more detail
Real estate brokers assisting appraisers by providing accurate and complete data
Consumer response to energy savings and if it is changing
HERS ratings and when will we all know our property’s rating
The relationship of “cost,” “price,” and “value”
Contribution of property characteristics to value
Substitution and the typical buyer
The Sales Comparison Approach relies on past data to form a current opinion
Are we on the verge of social change? Will buyers begin to ask sellers for past utility bills, HERS ratings, energy efficiency certifications, walk scores, and other energy related characteristics of the house? Will these matters impact value? Time will tell.
What is certain is that appraisers must keep abreast of social changes to determine if they have an impact on appraisal theory and practice and we must also be ready to revise current appraisal methods and techniques and devise new methods and techniques to meet new circumstances. The competent, professional appraiser will also continuously improve skills so as to remain proficient in their profession.
BrightPath Education is pleased to be chosen for a joint venture with Appalachian State University and the North Carolina Energy Efficiency Alliance to offer a series of classes across the state to help appraisers increase competency level in appraising energy efficient subjects.
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