You spend extra to get high performance features for your energy-efficient low maintenance home such as: more/better insulation, efficient heating and cooling, air sealing, ventilation system, durable roofing and siding, better windows, efficient appliances, low energy lighting, low/no VOC paints & finishes, cabinets, carpets, counter tops, and flooring. Perhaps you’ve invested in solar, wind, or other renewable energy sources.

These features help your home use less energy and cost less to maintain and are potentially healthier for your home’s inhabitants.

So with all those green features, your home should be worth more, right? But how much more?

A key person involved in assigning value to a home, whether the valuation is used for an existing home for sale, or a loan to build a new one, is an appraiser. Typically the appraiser uses the sales prices of comparable, nearby homes sold to assign a value, but with relatively few high performance homes built, and even fewer sold, finding “comps” is difficult. Further, an appraiser needs to have had formal training to properly valuate green and energy efficient features, and very few are certified.

So how do you get that value on your appraisal if:

  • The pool of green homes is limited,
  • Few appraisers are qualified to be green appraisers (taken the additional classes to be certified; at present there is only one in eastern Iowa)
  • There aren’t that many classes and trainers
  • There are shades of green, from light to bright
  • Several organizations have their own ways to measure green, and they’re not necessarily comparable

The Appraisal Institute, the organization that trains and certifies appraisers around the globe, has a newly revised (May, 2017) document (Residential Green and Energy Efficient Addendum) that you and your builder can fill out, with the help of contractors and third party verifiers, and that the appraiser and lender can use to assign a fair value to your home’s features. The Addendum identifies features not included in the regular appraisal form and provides a way to valuate them.

The first two sections provide for listing third party verifications and efficiency features. Next are sections on Solar panels, both photovoltaic and solar thermal, and followed by sections on Location-Site, and finally, Incentives, such as tax credits and rebates.

An excellent supplement to the Addendum is found at the Additional Resources page:

The flyer summarizes the value of appraisers who are trained in green building, gives steps that builders and buyers should take, and includes a sample letter to lenders.  In brief:

For Builders:

  • Before construction begins, notify the utility provider that you’ll be building a high performance home that will qualify for rebates.
  • Get the performance of the finished home verified by a Home Energy Rating System (HERS) test, conducted by a qualified HERS rater.
  • With the owner, subcontractors and HERS raters, fill out the Addendum and provide a copy, along with the HERS report, to the owner.
  • Direct the owner to give the two documents to the lender.

For the Owner:

  • Refer to the sample letter to lenders to inform them of the special nature of your high performance home, and the need to engage an appraiser who is trained and competent to valuate your home.
  • Provide the lender a copy of the completed Addendum along with the HERS report. If selling an existing home, provide copies to the Realtor as well.


The Addendum is a bridge between valuating traditional construction and a need to recognize and assign a fair value to green features deserving recognition but not yet incorporated into mainstream construction.

Of the six elements of green building (site, water, energy, materials, indoor air quality, and maintenance and operation), … “energy and water elements are the most measurable. Appraisers need savings amounts to develop an income approach to support energy efficient contributory value.” The value of non-measurable elements may be up to the discretion of the appraiser.

To avoid confusion between owners, builders, appraisers, lenders and Realtors, an extensive glossary is included.