Nevin, Rick and Watson, Gregory (1998): Evidence of rational market valuations for home energy efficiency. Published in: The Appraisal Journal , Vol. 4, No. 66 (October 1998): pp. 401-409.
Download (70kB) | Preview
According to this study, residential real estate markets assign to energy-efficient homes an incremental value that reflects the discounted value of annual fuel savings. The capitalization rate used by homeowners was expected to be 4%-10%, reflecting the range of after-tax mortgage interest rates during the 1990s and resulting in an incremental home value of $10 to around $25 for every $1 reduction in annual fuel bills. Regression analysis of American Housing Survey data confirms this hypothesis for national and metropolitan area samples, attached and detached housing, and detached housing subsamples using a specific fuel type as the main heating fuel.
|Item Type:||MPRA Paper|
|Original Title:||Evidence of rational market valuations for home energy efficiency|
|Subjects:||Q - Agricultural and Natural Resource Economics; Environmental and Ecological Economics > Q4 - Energy > Q43 - Energy and the Macroeconomy|
|Depositing User:||Rick Nevin|
|Date Deposited:||11. Dec 2011 17:01|
|Last Modified:||14. Feb 2013 22:25|
William Prindle, “Energy-Efficient Mortgages: Proposal for a Uniform Program,” 1990 Summer Study on Energy Efficiency in Buildings, American Council for an Energy-Efficient Economy, Washington, D.C., August 1990, 7.155.
Robert Halvorsen and Henry O. Pollakowski, “The Effects of Fuel Prices on House Prices,” Urban Studies, v. 18, no. 2 (1981): 205–211.
John B. Corgel, Paul R. Geobel, and Charles E. Wade, “Measuring Energy Efficiency for Selection and Adjustment of Comparable Sales,” The Appraisal Journal (January 1982): 71–78.
Joseph Laquatra, “Housing Market Capitalization of Thermal Integrity,” Energy Economics (July 1986): 134–138.
Molly Longstreth, “Impact of Consumers’ Personal Characteristics on Hedonic Prices of Energy-Conserving Durable Good Investments,” Energy, v. 11, no. 9 (1986): 893–905.
Ruth C. Johnson and David L. Kaserman, “Housing Market Capitalization of Energy-Saving Durable Good Investments,” Economic Inquiry (July 1983): 374–386.
Terry M. Dinan and John A. Miranowski, “Estimating the Implicit Price of Energy Efficiency Improvements in the Residential Housing Market: A Hedonic Approach,” Journal of Urban Economics, v. 25, no. 1 (1989): 52–67.
Marvin J. Horowitz and Hossein Haeri, “Economic Efficiency v. Energy Efficiency,” Energy Economics (April 1990):122–131.