Builders Underestimate Home Buyers Environmental Priorities

Home builders commonly assume that buyers are interested in spending as little as possible except when it comes to fancy extras like granite countertops and whirlpools. Many also claim that buyers are not particularly interested in green products for their homes. An on-line survey of individual and builder attitudes toward green features in home building concluded the opposite. According to the survey, builders are behind the mark when it comes to understanding the preferences of their market when it comes to green buildings.

The nationwide survey was conducted in September 2000 at HousingZone.com and was sponsored by Cahners Residential Group, publisher of Professional Builder, Luxury Home Builder and Professional Remodeler. Builder respondents represented the general residential market with most constructing fewer than than 10 homes a year. Only 17 percent build more than 50 homes a year.

According to the study, both the building community and potential home buyers are increasingly aware of environmental issues as they relate to home building as compared to as little as five years ago. Builders are still behind the curve though when it comes to understanding customer concerns and priorities regarding green building. Across the board they underestimate buyers’ interest.

Builders indicate that certain green features are becoming standard. They almost unanimously value energy-efficiency features (98.6%), and 45% consider recycled content, renewable resources, reduced off-gassing and durability when they decide which products to buy.

Buyers say their three most important upgrades when buying a new home are energy efficiency features (87%), kitchen cabinets (66%) and indoor air quality (50%). The environmental issues they are most concerned about are saving energy, using recycled-content building products and improved indoor air quality. Not using old-growth trees in buildings was a close fourth. Builders underestimate buyers’ concern for these areas on all counts.

Individuals want energy efficiency, resource conserving and air quality features as standard in new homes:

Insulation above code 93%
Low VOC paints 89.9%
High-efficiency furnaces 88%
Water-conserving faucets and appliances 85.5%
Formaldehyde-free insulation 76%
Heat recovery ventilation unit 70%
Passive solar features 64%
Recycled content decking 59%
Solvent-free wood finishes 57.6%
Energy Star certification 51.7%

95% percent of builders say the greatest constraint in using green products is cost and local availability. They claim green products are 5-15% more expensive and don’t believe most customers are willing to pay the difference. 89% of buyers, however, say they are willing to pay more for lower utility bills and better indoor air quality.

Home buyers typically don’t know what the the price is for specific building products, they know what they value in a home. 56% say they will pay an additional $2500 – $5000 for a green upgrade to their home, which amounts to the 1-2% premium typical of a green upgrade for a $200,000 home. 65% of individuals also say they would use money available from energy savings to purchase more green upgrades rather than pocket the cash. About the same percentage believe builders are not constructing homes that are environmentally sustainable.

According to the survey, builders buy green products from their traditional distributors 80% of the time (only 10% buy direct from the manufacturer), and noted that sales staff are not knowledgeable about environmental features of products.

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