A study conducted by Rent.com in February 2010, concluded that the desire for eco-friendly homes has skyrocketed. Check out some of the findings:
- 86 % of renters would prefer to live in an eco-friendly home.
- 55 % are willing to spend more in rent to live in one.
- Renters were almost three times as likely to say that living in an eco-friendly home is absolutely necessary for them.
- 42% said they were willing to pay up to $100 extra to live in an eco-friendly home and 13% were willing to pay even more than that.
- 28% of respondents were most impressed with apartments that offered energy-saving appliances.
Real life example:
In the city I live (Encinitas, California) there are currently 148 homes available for rent. Of those homes, I could not find any that offered any ‘green’ features at all. That is amazing considering the demand and the premium a green rental offers an investor. 0 for 148. In a town where the average rental is $1800/month, that’s an estimated minimum of $1200 these owners are potentially throwing away each year.
The main reasons I see investors not greening their rentals are:
- They think it costs too much.
- They don’t have a clue what to do.
- They don’t think they can get a premium in rent for greening it.
Of these reasons, only #2 is a truly valid one. In regards to #1 and #3, the stats and data show that you can go green, have it cost you less money AND gain you a premium on your rental. However if you don’t know what to do (#2) that can be a problem.
With the investors I’ve worked with across the US, I find that it’s #2 that is usually the stumbling block. It’s becoming easier to prove #1 and #3 to investors. I’ve written before about some of the best ways to green your rental property; you can see just one of the articles here.
The results of this study are going to change the rental market game. There is simply too much demand (and thus too much money) for investors to ignore it anymore. This is a game changer for all of us.
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Article Author: Jim SimcoeJim has written 23 articles for us.
Visit Jim's Website: http://www.jimsimcoe.com
I help real estate investors increase profits and property values through a variety of green strategies. I help clients find hidden rebates, tax incentives and credits to maximize returns on any property. www.JimSimcoe.com
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Far cheaper than installing new appliances would be affording your tenants access to even a tiny gardening plot. Throw a few 2X4s and some dirt on an unused (and sunny) section of grass – golden! In my recent house hunting search (entry level), I didn’t see a single listing boasting even basic, cheap green features like this. They really don’t need to cost anything, but would really set a property apart.
You are so right, Lauren. At our last house we created a garden in half a day out of wood fencing and some 2×4′s. Simple set-up and it became the talking point of so many of our outdoor parties, etc. Huge value at a very low cost.
Did that report distinguish between high end and low end rentals. I understand the example you use here in this post, but I wonder what the effect would be in an $800/month market.
The misconception of going green costing to much is alive and well here in Canada. When I question property investors and property manager within my area about cost of going green, most individuals stat that it is not feasible to go green, as they have to build a new building, get solar panels and then pay for LEED certification. Nobody every thinks about just adding a gardening plot.