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HolidayBuyer's Guide
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Does that house come in green?

High energy prices, global warming worries and health concerns are driving the rise of green real estate services. Images: Realtors turn green

Heather Stephenson wanted the first home she bought to be green--not in color, that is, but in terms of energy-efficient features, recycled materials and healthy indoor air.

Yet when Stephenson moved from New York to San Francisco last summer, the Web entrepreneur didn't quite find an emerald city. The pickings remain slim for properties glittering with solar panels and other eco-friendly amenities.

Determined to find her green dream home, Stephenson called real estate broker Chris Bartle, president of Green Key Realty. His firm is one of several real estate agencies specializing in eco-friendly homes, and it is on the cutting edge of services providing new, green opportunities both for home buyers and realty professionals.

Bartle led Stephenson to a century-old Edwardian-era house with a south-sloping roof ideal for solar panels, and a yard ripe for an organic garden. With shops and restaurants within walking distance, the lack of a garage for her Toyota Prius hybrid wasn't a deal-breaker. Stephenson moved in this spring.

"For people who are starting to develop an interest in a 'light-green' lifestyle--maybe they're driving the SUV to Whole Foods--the home-buying process is a great place to start," she said.

Stephenson may not represent the typical home buyer, however; she is already dialed into the green scene as the CEO of Ideal Bite, an eco-friendly lifestyle tip sheet e-mailed daily to more than 125,000 subscribers.

But, increasingly, she's not so unusual either. Demand for green homes and green amenities is growing. Companies like Michelle Kaufmann Designs and Living Homes are creating subdivisions out of modular homes built in factories. Mainstream developers such as Centex Homes, Lennar and The Grupe Company have begun to integrate solar panels during the construction process; the solar panels, salesmen report, are something of a status symbol. You can even get a green luxury condo in Dubai.

Matsushita and others, meanwhile, are coming out with new lines of green appliances. Most of these companies emphasize cost, quality and cost savings as benefits: Helping save the earth is considered more of a side bonus.

Women and young married couples are driving this trend, according to reports by McGraw-Hill Construction, which cite treading more lightly on the planet and reducing energy expenses as green consumers' primary motives.

The construction industry pumps out more greenhouse gases than all cars on the road, and building and maintaining buildings consumes two-thirds of U.S. electricity, according to the Department of Energy. Greener buildings that lighten that ecological load are beginning to look more like their mainstream neighbors down the block, and less like yurts pitched in communes, circa 1968.

Green buildings make up 2 percent of all U.S. construction, according to McGraw-Hill, which predicts that 5 percent to 10 percent of newly built housing by 2010 will offer several green features. That would bring today's $7.2 billion green residential market up to $38 billion in just a few years. Yet for the near term, at least, most homeowners hoping to go green must settle on renovation nips and tucks utilizing both high and low technologies.

"The best way to be sustainable is to use existing resources instead of building new," Stephenson said.

"The best way to be sustainable is to use existing resources instead of building new."
--Heather Stephenson,
CEO, Ideal Bite

She is retrofitting her vintage home by sealing energy leaks, optimizing natural resources and reducing waste. Longer-term goals include the installation of solar panels, a solar hot water heater and a rainwater-catching system to quench the garden. Stephenson also plans to decorate with milk-based paints to help improve air quality indoors, which may be typically two to five times worse indoors than outside, according to the Environmental Protection Agency.

Stephenson credits real estate broker Bartle with opening her imagination and referring her to a noted green architect. Green Key Realty has expanded to seven real estate agents from two last year. In addition to revamping both his office and home to become greener, Bartle conducts transactions online whenever possible--a tricky feat in San Francisco, where property bids can involve 80 pages of paperwork.

"Four years ago, green real estate didn't exist in San Francisco," he said. "I thought I'd help expedite the creation of that."

Meanwhile, a green seal of approval is attracting widespread attention in some circles of real estate agents. Green Key's staff holds certification with EcoBroker, a program that teaches real estate agents to guide clients in finding the greenest potential in a property. More than 1,400 real estate agents have passed EcoBroker standards. That's small, considering the nation's 1.3 million agents, but requests from Realtors in more than a handful of states flow to EcoBroker weekly.

Realtors holding the certification may not be getting rich quickly from the green marketing angle, but many anticipate their additional skills will provide staying power. Interest in EcoBroker varies by region, with 137 certified Realtors in California, for instance, 7 in Illinois, and none yet in Louisiana.

"The handwriting's on the wall that we need to be building or retrofitting homes so they're more sustainable," said Beth Fisher, who became Indiana's first EcoBroker certified Realtor in March.

Some of her colleagues initially snickered at the green label, but Fisher believes that they will change their minds as sustainable building reaches a tipping point, especially as high prices of natural gas and oil make more people interested in greening a home to save money. To that end, Fisher may guide clients to seek energy-efficient remodeling rebates enabled by the federal Energy Policy Act of 2005, or to pursue federally approved Energy Efficient Mortgages, which help buyers obtain larger loans for making green upgrades. Additionally, local governments could force the issue in the future by passing laws to mandate green residential construction.

"There's a myth that to buy or build something sustainable or green, it's going to cost 15 to 20 percent more," Fisher said. But green features may add that much to the resale value, real estate agents estimate.

In high-end properties, trendy green materials such as recycled glass countertops now cost the same as granite and other luxury amenities. Prices continue to drop for greener building products, such as bamboo flooring, as they gain prominence in popular stores including Home Depot.

Along with the slow yet steady mainstreaming of sustainable housing has come a hodgepodge of more than 30 voluntary green-building certifications. In California, the GreenPoint Rated system managed by nonprofit Build It Green marks homes with better-than-average energy efficiency. Nationwide, some 10 percent of new homes pass the Department of Energy's EnergyStar rating.

A more stringent national label is LEED for Homes, set to launch this summer. LEED is a project of the Leadership in Energy and Environmental Design program of the nonprofit U.S. Green Building Council. Residential LEED ratings have already marked more than 190 cream-of-the-crop, sustainable dwellings. LEED also offers an accreditation system for building professionals; at least 28 real estate agents in 20 states have passed the exam.

Various green ratings have labeled more than 97,000 homes in the past decade, according to the National Association of Home Builders. Yet that remains a tiny amount compared with the 6 million to 7 million homes typically sold each year.

Although so many green seals of approval could cause confusion, green real estate professionals agree that any label is better than none. Kria Lacher, the first EcoBroker-certified Realtor in Portland, Ore., pushed for two years to incorporate ratings from Energy Star, LEED and the local Green Advantage program into her region's Multiple Listing Service database used by real estate agents to list properties. Her goal was realized in February, and the largest MLS for the Seattle area followed suit last week.

Similar efforts are under way for MLS regional databases in California, Nevada, Texas, Iowa and Virginia. Once established, however, it will likely take many years for real estate agents to fill in the blanks.

People seeking or selling an eco-friendly abode might look for an EcoBroker Realtor, but they can also turn to independent online marketplaces, such as the Green Homes for Sale Web site, which receives some 100,000 visitors each month. The 177 North American properties listed there vary in price, from a $139,000 straw-bale cabin in De Soto, Wis., to a high-end $3.5 million bayfront, off-grid home in Key Largo, Fla.