Using Energy Savings to Sell Homes

As third party-verified energy efficiency gained popularity in residential construction, we learned that Energy Star® Certified homes are built to standards well above most other new homes on the market — delivering energy efficiency savings of up to 15 to 30%.

Building homes that save money and use less resources is better for the environment, and creating homes that are more comfortable and durable to live in makes sense. Joining the Energy Star program seemed like an extension of our existing philosophy.

The Medium and the Message

We committed to building 100% Energy Star Certified homes. This goes beyond the requirements of an Energy Star Partner, which only involves building one home to the standard in a 12-month period. That was a big difference, and forced us to re-examine our unique selling points and rework our sales marketing strategies and messaging.

Most people want to own a home that costs less to operate, uses less energy and is more sustainable during the life of the home. In other words, they want an Energy Star home. Once we had that very compelling value proposition to share with our buyers, we knew our marketing needed to reflect that.

We developed ideas to demonstrate the importance of building 100% Energy Star Certified homes in a relatable way, without diluting our message. We decided to offer a $5,000 Energy Star guarantee.

As part of our guarantee, every new home is inspected by a certified Energy Star rater to ensure the home meets or exceeds the Energy Star Version 3.0 (3.1 for Florida) performance guidelines by the U.S. Environmental Protection Agency. If the home does not meet this standard, then we will pay the buyer $5,000. This is a simple but effective message.

Telling the Story in Different Ways

Technical information about insulation, windows and HVAC systems is what builders live and breathe on a daily basis. While this information is important, it doesn’t convey what the buyer is looking for. Messaging should focus on the benefits of a happier, healthier lifestyle.

Instead of talking about Seasonal Energy Efficiency Ratios (SEER) and HVAC systems, highlight how a more efficient air-conditioning system results in more comfort and more peace-of-mind for the home buyer.

Homeowner David Thornton got the message. “When my wife and I began looking for a builder in the Jacksonville area, finding one who built to Energy Star standards was a priority,” Thornton said. “We invested a lot of time researching area builders and visiting models. From the moment we walked into the Providence model, we could feel the difference. There was a consistent temperature throughout, the quiet was noticeable, and I did not feel the sun’s radiant heat coming through the windows.”

Robert Goettlicher is the vice president of sales and marketing for Providence Homes, Inc. in Jacksonville, Fla. This post is adapted from a story in the November/December 2018 issue of Sales + Marketing Ideas. Download the Sales + Marketing Ideas app on iTunes or Google Play to read it.

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Comments (4)

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  1. Joe Honick says:

    Was it ever NOT a good idea to market energy-conserving homes? More than a few builders did object many years ago when I was leading an effort to raise Residential Energy Standards(1980s) and received Congressional support in the Record. NAHB only enhances its and industry’s image with as broad as possible concentration on such savings and the idea builders care.

  2. Armando Cobo says:

    One of the most important steps for Builders to sell high-performing homes is to get them appraised properly. The Appraisal Institute developed a designation for a Valuation of Sustainable Buildings Professional Development Program. It would be a tremendous help if all Builders, Buyers, RE Agents and Lenders start requesting these designated professionals. Builders are losing 10-15% of appraised valuation in their efficient homes because no one asks for a Sustainable Buildings Appraiser. Builders can download AI Form 820.05 and take a look what it takes. It blows my mind that this program has been there for years and only a handful of people gets a chance to use it.
    For example, in the DFW market, in 2017 there were 32,000 new homes built, an many of them to Energy Star or greater efficiency levels, and yet, there is not a single Certified Appraiser to work this market. I’ve asked a handful of Appraiser why they don’t get their Certifications, and their answer is there is no “demand”… I wonder if Bill Gates, Steve Jobs or Jeff Bezos waited for a market to demand their products. Our whole industry needs to do better!

  3. Jeff Gephart says:

    Armando Cobo brings up a very important point. I urge readers to look at the Appraisal Institute’s Green Resources webpage to see if there are Valuation of Sustainable Buildings Professional Registry listed appraisers in your area.

    On that page is the Residential Green and Energy Efficient Addendum, a form that builders of Energy Star and higher efficiency homes should fill out for their buyer’s use in the appraisal process. The same applies to well renovated homes.

    There is a very good document that provides a strategy for discussing the appraisal process with buyers and their lenders. It is titled, Appraised Value and Energy Efficiency: Getting It Right, and it lives in three locations for different user types:

    • This is the original, intended for builder use: https://www.appraisalinstitute.org/assets/1/29/AI-BCAP_Flyer.pdf

    • This is a version modified by the Home Performance Coalition: http://www.homeperformance.org/sites/default/files/Appraised%20Value-Retrofit%20FINAL_0.pdf

    • This modification is provided for Realtor® use: http://greenresourcecouncil.org/Appraisal-Links

    Finally, if you want a deeper understanding of these issues, I suggest you pick up a copy of Residential Green Appraisal Tools by Sandra Adomatis. You can get a copy through the Appraisal Institute’s Green Resources webpage.

    Unless we provide data to the lender and appraiser we have no chance of seeing higher value for better performing homes.

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