When you’re buying a new car, one of the first things you look for is fuel efficiency. Car manufacturers know this, which is why they like to stress in their commercials how their vehicles are best in class for fuel efficiency or get the most mileage per gallon. After all, buying a car is a big deal and you want to make sure you’re making the right decision, and buying one that’s affordable. The same applies to buying a home.
What many people don’t realize is that buying a home means more than just meeting the monthly mortgage payments. In fact, outside of the home loan, it’s energy that accounts for the highest cost of home ownership. Knowing a home’s potential energy costs could strongly influence your decision to buy or not, which is why you should ask for a home’s Home Energy Rating System (HERS) Index Score.
Created by the Residential Energy Services Network (RESNET), the HERS Index is the industry standard for measuring a home’s energy efficiency. It is also the nationally recognized system for inspecting, testing, and calculating a home’s energy performance. A lower HERS Index Score denotes a more energy efficient home. And that means greater savings for homeowners. A home built to the 2004 International Energy Conservation Code scores 100 on the HERS Index, while a typical resale home in the United States will have a score of 130.
Builders across the United States have understood that homebuyers are concerned about high energy costs. As a result, more of them are opting for home energy ratings so that they can use the resulting HERS Index scores to sell their homes. Homeowners, too, are getting HERS Index scores for their homes so that when they sell, they can command better prices through lower HERS Index scores.
The growing importance of HERS Index scores to homeowners is reflected in the fact that to date over 1.5 million homes have HERS Index scores, and 200,000 U.S. homes are rated annually for energy efficiency and issued with HERS Index scores. Furthermore, a recent study conducted by the University of North Carolina’s Center for Community Capital and the Institute for Market Transformation (IMT) found:
- Default risks are 32% lower for energy efficient homes.
- Homebuyers financing energy efficient homes were a quarter less likely to prepay their mortgages.
Smart homebuyers understand the value of the HERS Index Score; if you’re in the market for a new home, make sure you’re a smart homebuyer too!