As a Realtor and EcoBroker, I have been giving a lot of thought to what the role of  a Home Energy Audit should be in the process of selling a house.  Unlike a Home Inspection or a Radon Inspection, a Home Energy Audit does not affect the safety of living in a property. So how should a Home Energy Audit be considered in the sales process?

You may or may not have heard of a Home Energy Audit.  While I could provide an explanation here, Ardently Green  (a company out of Northern Virginia, which is, for purposes of full disclosure, owned by my husband) has a great explanation of a Home Energy Audit. Here you will find information about how the Audit is conducted, the report that you will receive and what kind of recommendations you can expect.

As a Seller, should you conduct a Home Energy Audit prior to listing your house?  I would recommend it--but only it if you plan on implementing a majority of the recommendations that come out of the report. If you have the audit done, but opt not to make the repairs, there is a distinct disadvantage in letting potential buyers know that you have had an audit. Basically, the report then becomes a way of pointing out problems with the house.  If , however, you make the repairs necessary to improve the efficiency and comfort in your house, most buyers would prefer to purchase a house that has been Audited and improved over one that has not. Who wouldn't choose the more comfortable and energy efficient home over a comparable less energy efficient property?

As a buyer, should you request a Home Energy Audit? This question is a little bit trickier.  First of all, making it a contingency on the contract will make your offer less attractive to a seller. After all, no one knows what the audit will find. What if the results recommend that all the windows should be replaced? As a buyer, that could be a deal-breaker if the seller is not willing to change the windows (not a cheap or easy process). As a seller, that is a very large ticket item and is very likely to be a deal breaker on the seller's side--it is tantamount to reducing the sales price by the cost of the windows.

But what if a buyer wants it done for Information Purposes Only?  This can be a real advantage for a buyer; they will know exactly what has to be done to improve efficiency in the house. Again, however, for the seller it can be a reason for a buyer to walk away from a contract.  Even if the contract does not require the improvements to be made, the seller may end up 'volunteering' to make the improvements to keep the Buyer from canceling the contract.

In both of these scenarios, we are thinking about big ticket items such as window replacement. Of course, the report will contain EVERYTHING than can be done to improve efficiency...windows might just be a 'nice to have' improvement; if a buyer looks at it that way, it can be a valuable tool. The problem is that a seller cannot know in advance how a buyer will view the results.

The truth is that most Home Energy Audits recommend some very inexpensive things that you can do to improve energy efficiency. Examples include:

1. Sealing around recessed lights to prevent air loss through the gaps.
2. Caulking around windows to improve air seal
3. Adding  or redistributing insulation in attics or behind walls
4. Insulating behind wall plates to minimize heat or conditioned air loss.

As you can see from this (incomplete) list, most homeowners can handle many of these tasks easily, quickly and inexpensively.

So what should the role of a Home Energy Audit be in a Real Estate Transaction?  It can be a distinct advantage for both the buyer and the seller if it is conducted prior to the property being listed and if the seller implements many of the recommendations that come out of the report. As a buyer, consider having an audit done on a house that you are purchasing, but be aware that doing it after the sale may make your offer more attractive to the Seller. Again, many of the improvements are relatively easy and inexpensive to implement.

If you are interested in buying or selling a home in Northern Virginia, I would be honored to meet with you to discuss how a Home Energy Audit can improve the saleability of your home or be used in the purchase of a property.