Buying an Efficient Home is About to Get Easier in Massachusetts

Home buyers in Massachusetts may soon be able to better gauge the energy efficiency, or inefficiency, of their potential future homes.  Last Tuesday, Governor Charlie Baker introduced legislation that would establish energy performance ratings and disclosure requirements for homes across the state.

Last Tuesday’s proposal is the latest addition to a suite of successful policies undertaken by the state.  Massachusetts has topped ACEEE’s State Energy Efficiency Scorecard for the past seven years, buoyed by strong utility policies, building energy codes, and state-led energy efficiency programs.  But with California and Rhode Island nipping at its heels, the Bay State isn’t resting on its laurels.  Instead, it’s working to integrate energy efficiency more deeply into its economy.

The legislation calls for the development of an energy scorecard, which would include a performance rating that must be disclosed to potential buyers of residential properties.  The legislation also calls for a number of features to support implementation of the energy scorecard system, including trainings for home assessors, real estate professionals, and lenders.

By building energy performance information into residential real estate transactions, Massachusetts could significantly increase energy efficiency investments in existing homes, as many new homeowners look to make home improvements just after purchase.  The Harvard Joint Center for Housing Studies found that households that moved within the past three years spent about one-third more on home improvements than otherwise similar non-movers.  Additionally, research has found that home energy rating systems can help demonstrate the value of home energy efficiency measures, leading 12-37% of home buyers to make recommended upgrades.

Currently, cities tend to lead the way when it comes to energy benchmarking and transparency policies for private buildings. ACEEE’s most recent City Energy Efficiency Scorecard identified 17 cities with residential or commercial benchmarking policies in place.  Boston is one city tackling efficiency by making energy performance information on large commercial buildings public.  Since 2016, Boston’s Building Energy Reporting and Disclosure ordinance has required that all buildings greater than 35,000 square feet in the city benchmark and report their energy and water use.

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