Green housing demand slows

MSNBC.com reported today that the slumping economy has slowed the development of "green" single family homes.  The drop in oil prices and the general worsening of the economy has made buyers less interested in low energy housing.

For many of the builders developing green housing, the reason seems to be the other type of green.  The sale of "green" homes gave them an advantage over their competitors.

"Encore" homes promised to slash electric bills by up to half, and buyers snapped them up even though Meritage (the developer) offered them at a higher price than nearby competitors."

"Sales figures in July showed that the Encore development sold 1.55 homes per week, compared with 0.88 homes per week for similar homes in the same city, Kramer said."

At an event in San Francisco a few weeks back, the developer of the Arterra building on King Street said that their decision to go green on their new structure did not necessarily mean they were able to demand higher rent/sale price.  He said the advantage was in marketing.

By having a green development, he was able to get more foot traffic, more phone calls and more general interest which led to a higher close percentage.  He estimated they were selling twice as many units per month than their competition.

When you come down to it, building green IS the responsible thing to do, but as you can see above, there are benefits to your bottom line as well, even if it doesn't come in the form of direct revenue.


Jared Willis