building a green real estate dynasty. tonight: 3 goals no theory
TRANSCRIPT
Building a Green Real
EstateDynasty
Tonight:3 Goals
No Theory
Learn
Choose to Act
Choose to Ignore
Tree-hugging Capitalist
What I Believe
Dream Big
Real estate SHOULD be:
Healthier
Safer
Less expensive
High-performance
WIIFM?
True Wealth.
What do we all want?
Love
Health
Wealth
Sex
Safety
Friendship
3 Wins...
My reasons...
Increased Profits
Leverage OPM (Uncle Sam)
No competition
Eco-Friendly
Why green homes?
Home Buyers WantGreen Features
According to a ZIP Realty survey:
• 89% of homebuyers rated energy efficiency the most important feature in a home.
• 55% of all home shoppers now cite green home features as an important part of their purchasing decision.
• Less than 1% of homes on the market include “energy efficiency” in their description.
Homebuyers who value green features ranked them important for
the following reasons: 12%
15%
37%
40%
49%
According to an Apartments.com survey:
• 60% of prospective renters search for properties that offer environmentally-friendly amenities.17% of renters said they would not rent an apartment without environmentally friendly amenities.57% of renters said their apartment community does not currently provide environmentally friendly amenities.
In a study done published by Inman News:
“32% of people said they'd pay an extra $5,000 for energy-efficient
features, with the presumption that the homeowner would recoup the cost of
those items over time.”
Columbine Ave, Phoenix
Vacant rental property
Market rent = $1000/month
Competition for renters = High
Phoenix example:
•Improved energy efficiency
•Improved water conservation
•Projected utility bill decrease = $105/month
What we did:
•$1500 for materials/labor
• Rebates = $750
• Net cost = $ 750
• Time to complete (3 days)
Cost to owner:
• Utility savings
• Healthier living (Less toxic)
• Craigslist blind ads
Marketing the rental:
• Property rented for $1100/month.• $100 premium above market rent.• $1200/year rental increase.• 40% higher response to ‘green’ CL ad.• Property rented prior to work being completed.
Results:
Is this ‘green’ to you?
1. Saves money.
2. Less toxic living environment.
3. Less impact on the planet.
Defining green:
The process of remodeling an existing
structure to create a high performance property.
Green real estate is:
Common ‘green’ real estate myths
Costs too much
Too complicated
No one cares about green
Follow the
3 ‘S’s
Seal it up
Systems & Solutions
Sex it up...
• Less toxic
• More efficient
• Polar bear friendly
Fundamentals of Healthy Green Environments
Green buildings:
•Energy efficiency
•Water efficiency
•Resource conservation
•Indoor environmental quality
Green thinking:• House as a ‘system’
• “Whole systems” approach
• Consume less energy and water
• Use resource efficient techniques and materials
• Healthier, safer, more comfortable
Key Points:
• Remove, Replace, Relax
• Remove toxic materials
• Ventilate the air
• Use renewable resources
Statistically...
•The United States comprises 5% of the total world population
•We use 25% of the world’s energy resources
Buildings in the U.S.
• Consume 65% of electricity
• Create 30% of total green house gas emissions
• Create 136 million tons of C & D waste each year
• Use 40% of raw materials globally
Building and resource use:
Construction of a 2,085 sq ft home uses up to 1.5 acres of forest
Where does outdoor
water go?• 40-60% of potable water goes
into the landscape
Pesticide facts• The likelihood of a child getting leukemia is
6X greater when herbicides are used on lawn
• More children with cancers had exposure to pesticides than children without cancer
• Pesticide links exist to infertility, birth defects, learning and neurological disorders, allergies, MCS (multiple chemical sensitivities)
• Come in on shoes and stay in carpet
• Moth balls (naphthalene) are one of the most dangerous chemicals available
Indoor Air• Indoor air pollution is 2-5 times
worse than outside
• We spend over 90% of our time indoors
• 60% of homes and 30% of commercial buildings are classified as “sick”
Air leak issues come from...
1.Duct work leaks
2.Faulty insulation
3.Windows, door frames
4.Plumbing penetrations
5.Fireplaces
6.Floors, walls and ceilings
Duct issues
• Ducts leak average of 30%
• Leaky ducts waste energy an decrease comfort
• Leaky air ducts can cause negative pressure- this can pull CO out of gas appliances into the home
• Use duct mastic on all duct joints
• Do not use duct tape!
Indoor Air Quality
(IAQ)
Indoor air/environmental
quality IAQ/IEQ• Materials and finishes
• Combustion gas safety
• Ventilation and moisture
management
• ‘Sick’ Building syndrome
Impact of negative IAQ
• 15% of homeowners may be allergic to elements in their own homes.
• 40% of children born today will develop some form of respiratory disease.
• Prevalence of asthma has doubled since 1976.
• Increasing links to ADD and asthma in children.
• Of all the chemicals that EPA monitors, only ozone and sulphur dioxide are more prevalent outdoors than indoors
Indoor Air Quality• Toxins
• Off-gassing
• Plastics
• Ventilation
• Plants
What is off-gassing?
• The release of toxic chemicals from common household materials (paint, furniture finishes, plastic, vinyl, etc)
Indoor Air Toxin Sourcesa. Formaldehyde (urea-particleboard/phenol-
osb,exterior grade plywood
b. VOC’s (gasoline, kerosene,xylene,Toluene. Paint, sealers, adhesives, caulks, can be absorbed by carpets and furniture)
c. Vinyl chloride (human carcinigen, found in PVC)
d. Nerotoxins (backing, glues, fire retardants, styrene,latex binders, fungicides, anti-static and stain-resistant treatments)
e. Carbon monoxide stove,furnace,gas water heater, gas dryer)
Formaldehyde• Two main types:
• Phenol formaldehyde (used outside)
• (Plywood, Oriented strand board)
• Urea formaldehyde/ (used inside)
• (Particle board, cabinet fiberboard, etc)
Volatile organic compounds (VOC’s)
• VOCs are typically in solvents used in fluid or flexible products
• Paints, sealers, adhesives and caulks
• Most of the ‘enes’ are VOCs
• Gasoline
• Kerosene
• Benzene
• Xylene
• toluene
Vinyl Chloride
• The principle element in PVC products
• “Beach ball smell”
• Problems with off-gassing, disposal
• Human carcinogen
• Dioxin and hydrogen chloride is emitted from production and during burning
Carpeting contains• Toxic chemicals in the fiber bonding material,
dyes, backing glues, fire retardant, fungicides, antistatic and stain resistant treatments
• 120 chemicals; some of which are neurotoxic
• They last at least 3 years
• Carpet is neither renewable, nor biodegradable
Carpeting
• Carpet is anathema to good air quality
• Offgasing and absorption issues
• Dust magnet (old carpet weighs more than new)
• Dust mites love it (if humidity is over 53%)
• Bacteria hide here
• It holds everything from bottom of shoes
Systems & Solutions
Energy efficiency• Structural system
• Increased insulation
• Air sealing
• Windows
• Lighting
• Energy Star appliances
• HVAC design, installation and testing
• Renewable energy
Water Conservation• Install water conserving appliances
• EnergyStar and WaterSense rated
• Install water conserving fixtures/systems
• Optimize irrigation system
• Rainwater harvesting
• Greywater plumbing
Ventilation
• Ventilation is the second way to reduce the impact of high concentrations of toxic gases
• Natural ventilation (windows, etc)
• Mechanical ventilation (fans, etc)
Fix air leak issues
1.Seal all holes in building envelop including: sill plates, top plates, electrical openings, plumbing openings, boxes around windows, attic hatches, HVAC closet, door-frames,
2.Use: spray foam insulation, weatherstripping, foam gaskets on electrical openings, etc.
Low energy cooling• Ceiling fans
• Standing in moving air under a ceiling fan makes the body feel 4 degrees cooler, thereby reducing air conditioning needs
• Increased comfort with the same temperature
• Choose EnergyStar fans (50% more efficient; have improved motor and blade designs; efficient lighting)
Insulating pipes
Hot
Reduces standby pipe loss
Saves water by reducing waste while waiting for hot water at the fixture
Cold
Reduces condensation and freezing problems
Green materials and
Recommendations
Choosing green materials
Insulation
Flooring
Appliances
Lighting
Natural linoleum flooring
• Durable, stain resistant
• Made of rapidly renewable materials
• Linseed oil, limestone, pine rosins, wood powder and jute
Renewable cork flooring
• Cork is rapidly renewable (7-10 yrs), naturally fire and moisture resistant, sound absorbing
• hypoallergenic
• no trees are cut down
Rapidly renewable bamboo
• A renewable resource, replenished by natural processes
• Bamboo is fast growing (7-10 years) comparable to wood
• Full grown stalks are cut lengthwise into narrow strips and glued together either horizontally or vertically
• Can be re-sanded and sealed
• Lots of products in market place
Carpet Alternatives
• Untreated natural fiber carpets:
• Wool, seagrass, sisal
• Make sure wool is NOT treated with toxic moth proofing chemicals
• Install with low or non toxic backing
Best Carpet Choices
• Recycled PET fiber carpets available
• Avoid styrene-butadiene latex backing (get woven backing)
• Low pile – high density may be more durable and hold less dirt
• Look for the carpet and rug institute’s “green label” and “green label plus” logos
Adhesives/Glues/Sealants
1.Typical ones are very toxic and off-gas
2.Found in cabinets, floor sealants, caulking, spray foam, carpet backing
3.Look for all-natural alternatives
4.Greenbuildingsupply.com
5.greendepot.com
LED’s: the facts
• LED’s (light emitting diodes) are making a fast entrance into the residential market
• LED’s produce more light with less electricity
• LED’s can last 35,000-50,000 hrs.
• (CFL’s last 8000-10,000 hrs)
Refrigerator and freezer
• Single largest power user in most households
• EnergyStar is minimum goal
• Size matters; small saves
• www.energystar.gov
Washer/dryer
• Horizontal axis washer (Front Loading)
• Use 40% less water & 50% less energy than most models
• Faster final spin- reduces drying time and cost
Paint
1.Chose No-VOC or LOW-VOC paint
2.Available at most most home stores
3.Very comparable to regular paint
Materials1.Use natural/solid woods when possible
2.Stay away from OSB and pressed wood products
3.Glues and sealants used are toxic
4.Other great materials: brick, tile, metal.
5.The more natural, the better
Appliances1.Replace old/faulty appliances
2.Look for Energy Star appliances
3.Washers, Dryers, Hot-Water heaters, Dishwashers
Mistakes to avoid
1.Spend too much
2.Do too much
3.Don’t consider payback
4.Don’t consider end-buyer’s wants/needs
5.Don’t have a clear plan
Free MoneySystem
What money is available?
•Rebates
•Tax Credits
•Incentives
•Grant money
Where is it?
•City
•County
•State
•Federal
•NGO’s
Rebate examples:
Text
DSIREUSA.ORG
GRANTS.GOV
ENERGYSTAR.GOV
\Incentives
Energy Efficiency Loan Programs
Sex it up...
Buy on emotion,
justify with logic
Don’t be this guy...
“Don’t give them what they want, give them what
they NEED”
Want Need
Trip to Hawaii Groceries
Bentley Car
Mansion Shelter
Want Need
Bamboo floors No toxins
Cool looking lights
Lower utility bills
Luxury Safety
Save moneyLive safely
What buyers/renters need:
Sell Planet first = you lose
Sell Savings/heath first = you win
Environmental benefit is a BY-PRODUCT
How to Increase Appraisal
Values
1. Energy Audit report.2.Build list of energy-efficient measures completed.3. List of energy-efficient materials/ equipment installed.4. Project annual utility expense savings based on historical data.5. Projected asset value increase 10-25 x annual savings)
Make Marketing Automatic
‘‘Green’ Sale Green’ Sale SignSign
‘‘Green’ Sale Green’ Sale SignSign
Wall Signs
‘‘Green’ flyersGreen’ flyers‘‘Green’ flyersGreen’ flyers
Results:
Sold for $5000 more, 61 days faster than market
Steps to build a green real
estate investing dynasty
Determine your ‘Why’
Hire Free Interns
“What’s in it for them?”
• They are passionate about green.
• They want the experience.
• It looks good on their resume.
Write PublishRepeat
4 of top 5...
Leverage Existing Data
(Warning: ugly slide coming up...)
Why Green, Why Now?
One Reason Only:
Something needs to change for you
right now
Mountain bikes and
Cosmetic Surgery
Potential Urgent Needs:
Falling revenues and decreasing profits
You need $200K by Tuesday
‘The Australians are coming...”
Launching your business next week
(without a C.A.)
Don’t pursue if you’re just
‘Interested’ or ‘curious’
Are you Thriving?
95% Rule
Q & A
Jim Simcoe
JimSimcoe.com
760-271-7128