Going green has not only become a forced choice, but also a lifestyle desired by many individuals these days. While savvy real estate agents are learning about the new niche actively, excited eco-enthusiastic homebuyers are also looking forward to more green projects.
My name is Ofir Bar, and as a successful investor in real estate and startup technologies, I’ve guided many eco entrepreneurs and investors with my expertise in the market. In this article, I will explore the meaning of green real estate, some of the development strategies reinforced, and its advantages for both homebuyers and investors.
What is green real estate?
Let’s start off by understanding what we’re talking about. Green real estate is a concept that takes social and environmental impacts of the development into consideration. Green real estate helps not only in preserving natural resources but also lowers utility bills due to its modern competence.
Green real estate is divided into three sub-categories namely:
- Environmental responsiveness
- Resource efficiency
- Cultural and community sensitivity
Environmental responsiveness is a factor that respects the ingrained value of nature. Resource efficiency refers to the utilization of lesser resources to monitor energy consumption. Cultural and community sensitivity refers to unique cultural values that each community practices and considers in real estate development.
Green real estate development strategies
The aim to go green was earlier a gnawing challenge, but not anymore. The real-estate sector, although not all of it (and some pessimists say not most of it), seems to have recognized its key role in building a green society.
Considering the importance and value of the environment, civic bodies have reinforced multiple conservative practices for igniting awareness among both real estate agents and investors to create a more sustainable future.
Strategies like Urban Growth Boundaries (UBGs) are designed to promote growth only within given boundaries, prohibiting it outside the boundary. Intending to encourage dense development, the UGB seeks to revitalize prime cities and craft a walk-able spaced society for all communities.
Net Zero is yet another action plan boosted by the World Economic Forum, that establishes a sustainability framework for the entire real estate industry. As per the report published by JLL (Jones Lang LaSalle Incorporated), only 18% of the organizations in the industry have a ready action plan for their real estate portfolio. While the focus is mainly on modern and futuristic buildings to help achieve the highest standards of certifications, the UN’s Race To Zero campaign highlights the urgent need to repurpose and revamp infrastructures.
Advantages of green real estate investment
Since green real estate investments are a necessity these days, investors and buyers are on-board for the same, considering the following benefits they would receive right from the beginning.
Higher quality of living includes enhanced air quality, natural lighting, consumption of less indoor pollutants and toxins, and saving on energy and water, an increase of the home’s ventilation capacity, and more.
Being a real estate investor, it is important to invest more in such green building designs to draw more value in future.
According to a UC Berkeley study, homebuyers are willing to pay nearly $15,000 for properties that consist of an average-sized photovoltaic system. Moreover, homes with higher sustainable certifications are likely to receive up to 30% more price premiums.
Monetary savings is another alluring factor that attracts many real estate investors.
A LEED (Leadership in Energy and Environmental Design) certified home gets an energy bill reduced on average by 20%.That can amount to around $200-$400 per year.
In addition, an NC state study shows that homeowners who use solar panels easily save between $44 and $187 per month during the installation’s first month.
Despite knowing all the merits, sadly, only a few sections of the industry actively participate in this green real estate development drive.
Of course the idea of such “expensive investment” haunted me earlier, just like any other investor. But green development does not necessarily have to be expensive, and even if it is, you should remember that the ongoing costs reduce after the project’s completion. And so I, Ofir Bar, recommend investors to put more of their fortune in green real estate, considering the appealing benefits to society as well as the environment.