@proceedings{35447,
  author = {Margaret Pigman and Jeff Deason and Nancy Wallace and Paulo Issler},
  title = {How Does Home Energy Score Affect Home Value and Mortgage Performance?},
  abstract = {<p>Energy-efficient homes save their occupants money through lower energy bills. These savings might be capitalized into higher home sale prices. They also improve the household{\textquoteright}s net cash flow, which might make households better able to pay mortgage debt. The U.S. Department of Energy (DOE){\textquoteright}s Home Energy Score (HES) assigns a 1-10 score to homes and estimates annual energy bills based on modeled energy consumption. In this paper we investigated the relationship between HES metrics and two housing market outcomes: home sale price and mortgage performance. We found that the relationship was only statistically significant in places with a mandatory HES assessment at the time of sale. Using a sample of 26,291 home sales that occurred after HES assessments, we found that a one-point increase in HES in these locations was associated with a 0.5\% increase in sale price, and an increase in $100 of estimated annual energy bills was associated with a 0.4\% decrease. This magnitude of effect is consistent with estimated magnitudes of home sale premiums for other green or energy-efficient home certifications in the literature. We also found that a one-point increase in HES was associated with a 5.5\% reduction in the odds of a loan going 30 days delinquent if the loan originated after the assessment occurred. Similarly, we found that a $100 decrease in estimated annual energy bills was associated with a 2.3\% decrease in the odds of a loan going delinquent if it originated after the assessment occurred. Our results suggest that HES provides a valuable signal for housing market transactions in specific situations.</p>},
  year = {2022},
  booktitle = {2022 ACEEE Summer Study on Energy Efficiency in Buildings},
  journal = {2022 ACEEE Summer Study on Energy Efficiency in Buildings},
  series = {2022 ACEEE Summer Study on Energy Efficiency in Buildings},
  month = {08/2022},
  institution = {ACEEE},
  publisher = {ACEEE},
  language = {eng},
}