Valley homebuilders turn to green to lure buyers

Sep 28 - McClatchy-Tribune Regional News - BoNhia Lee The Fresno Bee, Calif.

Homebuilders in the central San Joaquin Valley are trying something counterintuitive in this tough real estate market: adding expensive features to their homes.

The idea is to lure buyers with energy-efficient features that can save hundreds of dollars each month on utility bills.

While some homebuilders pick up the extra costs, a "green" home can cost up to 20% more than a conventional new home. But buyers can save money over the long run, and an increasing number are willing to make the investment, building experts said.

Energy-saving features include tankless water heaters, which don't waste energy by keeping hot water in a storage tank; tighter duct insulation and 2-by-6-inch framing, which provides thicker walls for better insulation than the typical 2-by-4 frame.

Add a solar-panel system, and the home's energy-efficiency increases substantially, lowering the electric bill. By themselves, none of these green features are new, but builders are packaging them together to maximize energy savings.

One builder, Wathen Castanos Hybrid Homes Inc., even changed its name to reflect a focus on green building. The company has gone so far as to rip out 1-year-old asphalt roof shingles on some of its model homes and replace them with concrete roof tiles, which cost more but insulate better.

It seems to be working. Wathen Castanos had expected to take 20 months to sell the 40 lots in its first line of energy-efficient homes in 2009, but did that within nine months, company officials said.

Since then, Wathen Castanos has adopted two more energy-efficient home designs. Other builders are incorporating green designs and energy programs, too, and have been unveiling them over the past few months.

"If you're a builder not heading in that direction, you're not going to last as a builder much longer," said Freddie Logue, director of construction for Wathen Castanos.

The green expansion

Also driving the trend is the state's building code. Rules updated in January set a higher environmental standard not just for the homes, but for the construction work.

Starting next year, builders will be required to install plumbing that cuts indoor water use by as much as 20%. They must recycle 50% of their construction waste and use low-pollutant paints, carpets and floors.

Homebuilders have been preparing for a green-building revolution. In February 2008, the National Association of Home Builders started to offer certified training in green building. Organizers hoped at least 500 builders would go through the program by the end of that year.

By November of that year, 1,000 people were certified. Now 5,500 are certified nationwide.

There are no statistics showing how many green homes have been built or sold in the past few years, but the fact that more homebuilders are getting trained in green building indicates the trend is growing, said Kevin Morrow, the association's senior program manager for green building.

Thousands more have been certified under other programs led by nonprofit organizations such as the U.S. Green Building Council or Build It Green, a California nonprofit that promotes energy-efficient homes.

Wathen Castanos is a GreenPoint Rated homebuilder, a label bestowed by Build It Green.

Fresno homebuilder De Young Properties introduced a design in August called the "Net Zero EnergySmart home," promising buyers a low or even nonexistent electric bill through the use of solar panels and other green design features.

Among the first in the Valley to offer environmentally friendly features was Granville Homes, which built its first energy-saving home in 2008. They are at least 36% more energy efficient than a house with current building standards, company officials said.

Since their debut, 161 "Eco-Smart" homes have been sold and another 40 are in escrow, said Michelle Brunn, sales manager at Granville. The company sells two Eco-Smart homes for every one in its traditional Tuscan model, she said.

Granville is in the process of building all of its new homes "Eco-Smart" because of their popularity, Brunn said.

Other green options

None of these features is cheap to install, of course. So homebuyers pay a premium in exchange for long-term savings or homebuilders may shoulder the cost.

Among the most expensive features are solar panels. Some builders are trying to minimize the bite by helping homebuyers lease the program instead.

Granville, for example, started a solar leasing program to cut the up-front cost of a solar system that can cost buyers between $10,000 to $70,000 depending on the size.

Homeowners can lease the system from the solar company, paying for $15 per kilowatt used per month. National builder Lennar Homes also offers a solar leasing program to Fresno homeowners.

Wathen Castanos homeowners at Harlan Ranch have already seen the energy-cost savings by buying green homes. The average monthly utility bill for a traditional home at Harlan Ranch is $274.75 while a green home is $44.11, the company said.

Builders are hoping the energy savings will attract more buyers. Today's homebuyers seem to be more interested in getting the lowest price possible and an incentive package that gives them something they can touch, like a refrigerator, said Freddie Logue, director of construction.

But that didn't stop the company from replacing asphalt shingles with concrete roof tiles on its Ivy Gate model homes in Harlan Ranch. Tile roofs are made from green material and reflect heat, allowing the attic temperature to stay low.

Their goal is to add more green features to their homes and show buyers how it can help them save money.

"It was a difficult choice to make the change on the models," Logue said, "but we had a lot of interest from buyers out there, so we decided to go this direction."

The reporter can be reached at blee@fresnobee.com or (559) 441-6495.