Should your next home be LEED certified?

If you are concerned about your home being more energy and eco-friendly, then you may have already heard of the LEED (Leadership in Energy and Environmental Design) certification some builders are pursuing for their new homes. While only a handful of homes in the Cincinnati metro have been certified, its time to ask whether the certification is worth it, if it will be the standard to follow, and whether we can expect to see more homes getting certified.

The LEED certification has primarily been focused in commercial buildings as the overall operational cost and "health" of the buildings is of greater concern and where it is easier to achieve long-term savings. Keystone Park was the first office building in Cincinnati to reach a silver level 'Core and Shell' standard. Several other buildings have achieved various levels for new construction standards. In the commercial world, the additional cost in building to LEED standards has already proven its worth financially.

The LEED standard for homes was first published in December 2007 and is now beginning to gain some traction. So, to the first question for residential development - is it worth it? Some will surely see the practice as worth almost any extra cost relative to the reduced environmental impact. Statistics on cost are a little difficult to come by, but consider that of 36 LEED homes in Hamilton County, only 3 were available below $400,000 suggesting that builders see effective margins only at the upper end of home sales. Furthermore, most of these homes were over 3800 sq. ft. in size. While it is commendable to build using standards that lessen the environmental impact, it's also fair to ask how green you are in a 4000 sq. ft. home.

One immediate impact in the city of Cincinnati is a special tax abatement for LEED certified properties. That's probably worth the price of admission itself. What we won't know for a while is whether the certification or its environmentally friendly features will add value on the resale. What I would also hope to see is a standard that builders apply to homes that are more in line with the median sales price for our area.

The US Green Building Council, which is the sponsor of LEED (and is not a government organization), itself acknowledges that there are over 70 different green building standards in existence today. Whether LEED is the "best" standard is a highly debatable subject, nevertheless it does have certain advantages including a nationally recognized organization, a system for 3rd party verification, and a process to measure the effectiveness of the standards and make improvements.

Can we expect more LEED-certified homes? Undoubtedly. If nothing else, some builders will see LEED as a marketing advantage to eco-conscious consumers. We already see this with Energy Star rated homes as the value has proven itself. The longer-term question will be how soon LEED-certified homes are available at mid-price points and yet profitable for builders. As with any new technical approach, costs are almost certain to go down over time as use increases.

Ultimately, having a home that is LEED certified can provide you with an assurance that your home was built to a specific standard. It's in your best interest though to work with a real estate professional that can help you sort through the variety of "green" building standards coming on the market to determine what's best for your situation.

For more information on LEED, visit the Cincinnati chapter of the US Green Building Council.