Green is still in. More and more businesses large and small are jumping on the bandwagon of environmentally friendly products, services and community planning initiatives. And now, the demand for energy saving features and earth-sensitive practices appears to be providing a not-insignificant boost to the recovering housing market: green homes command not just higher purchase prices, but also higher rents.
Green is the shorthand for a wide range of products, services and strategies that reduce damage to the environment and conserve energy. In the housing industry, opportunities for green building and upgrading can range from land management and building plans for new homes to installing new, energy conserving ductwork in an older home. Landscaping, too, can be a green investment. Planting shade trees to offset heat or xeriscaping to reduce water use also enhance a home’s green appeal.
Whatever the strategy, though, environmental experts and economists agree that green is in – and the desire to at least appear environmentally aware is driving decision making in many areas of the economy. According to Green Real Estate Investing News, that’s especially true in the housing market, where green-certified new homes may sell for 30% more than their standard counterparts in more affluent markets. Existing homes with a few green upgrades like solar paneling or energy-efficient appliances also sell for more.
In the rental market, too, green housing generates interest. Rental housing is in high demand now, fueled by new kinds of renters – affluent professionals and retirees who’ve made a decision not to own a home. These groups, educated and often socially and politically active, may seek out rental housing with environmentally friendly features too.
The benefits of going green aren’t just for new home starts. A variety of companies and even state and federal programs offer incentives and support for home owners seeking to install energy saving devices and make green upgrades in existing homes. These expenditures also qualify as tax-deductible improvements and maintenance.
The financial gains from eco-friendly upgrades ma not be immediate – and for some, the initial outlay can be considerable. But over time, even small changes can pay off in lower utility bills, more efficient use of resources and claimable deductions – as well as a smaller carbon footprint in the world. For income property investors, going green may mean taking the long view for returns on their efforts. But as Jason Hartman says, the long view – buying properties and holding them — is the one that leads to wealth. (Top image:Flickr/Zalazar)
Read more from The American Monetary Association:
The American Monetary Association Team