Home Sales Down, Eco-Loans Are Up
By Tim Gaskin

Dec 3 | archive | subscribe

Mark Benjamin, Zephyr Real Estate agent, agrees the volume of home sales in San Francisco is down, although price points have risen and properties continue to appreciate. He should know, he specializes as a residential, investment and green agent, who says green alternatives are the way to go. He adds, “At a time when business has slowed, many are turning towards eco-loans, green real estate and energy efficiency.”

While there is no standard definition of green mortgage products or programs, mostly it’s up to individual lenders whether they decide to offer a "green" product. "Green" mortgages, or eco-loans, are based on the premise that a more energy efficient home will produce lower monthly utility bills. Homeowners will be paying less in utility bills, and therefore, that savings will translate into income and could allow the homebuyer to purchase a more expensive home.

Benjamin says some lenders will discount loans on a variable rate if the home is energy efficient and that others will allow buyers or owners to borrow to invest in energy efficient improvements.

“As energy cost rise, green mortgages will become more popular and be supported by a broad spectrum of lenders. An energy-efficient home may save a homeowner one-third to one-half on home energy costs,” notes Benjamin.

New Resources Bank, Sustainable Capital, Wells Fargo Bank, and Merchant Bank of Berkeley are just a few of the banks that Benjamin works with that support eco-loans or green mortgages.
 Even more financial institutions are establishing green strategies, projects, products, and ways to create valuation tools for green buildings. “It is important that the finance sector place a greater emphasis on involving themselves in green strategies and promote business, services and living environments that are sustainable,” adds Benjamin.

The paperwork involved in an eco-loan is very similar to a standard loan, however Benjamin says many lenders are clueless as to what a green mortgage is. Another trend according to Benjamin, is energy efficient “Zero Energy Home,” which produces enough energy to offset the amount purchased from the utility resulting in a net-zero annual energy bill, sending the electric meter in reverse.

Benjamin says not to worry if you’re not in the market for a green home or an eco-loan; there is plenty you can do with your existing home or apartment. He suggests utilizing double-paned windows, weather striping doors and vents, insulating your water heater (better yet go tank-less with an on-demand water heater), increased insulation, energy efficient and Energy Star rated refrigerator, HVAC, washer, dryer, and dishwashers.

“And, of course, diligently separate your trash into the appropriate cans for recycling, use public transportation, and this is just for starters,” finishes Benjamin.