Greening the Real Estate Transaction

(Image credit: Apartment Therapy)

If you’ve bought a house or condo, you know about the mountain of paper you sign at closing. We’ve been deluged with press releases about a new technology that eliminates the paper in favor of an electronic signature, but before we blog that, we wanted to talk about a green idea from across the pond with greater and longer-lasting effects than just eliminating a stack of paper.

We’ve been looking into the process of buying property in Denmark. When a home changes hands there, here’s what happens:

  1. An independent inspector comes to assess the amount and quality of the insulation and energy conservation measures in place.

  2. The inspector calculates how much energy the house should use under normal circumstances and then compares that to the past year’s energy bills. The current owner has to explain any significant discrepancies in writing.

  3. The inspector prepares a list of things that could be done to decrease energy consumption, and the prospective buyer can use this list as a negotiating tactic.

It seems like this would be fairly simply to implement in the US, as we already require inspections, and have readily accessible data on energy use (i.e., bills and computerized records). The big shift would be to require the inspection to require the seller to obtain an inspection before the property goes on the market — which then raises questions about accountability.

But if we’re going to rethink the entire process of mortgages and buying and selling a home, then we might as well toss a few ideas about energy conservation into the mix.

It’s worked for Denmark: in 1973, Danish homes were second only to the US in per-capita energy consumption. Today, thanks to measures like these, the country is a leader in energy efficiency.

photo by johnnyberg via