Chicago Homes that Disclose Energy Costs Spend Less Time on Real Estate Market
A preliminary analysis shows that Chicago single family real estate listings that disclosed energy costs spent less time on the market and had a higher closing rate.
In July 2013, the City of Chicago became the first municipality in the country to disclose residential energy costs (gas and electric) when a home was listed for sale via a multiple listing service (MLS). The achievement was the result of a unique partnership between Midwest Real Estate Data (MRED), the MLS serving Chicago; City of Chicago Office of the Mayor; and Elevate Energy. When a home is listed for sale in Chicago, Realtors can access an energy cost disclosure report for a property in near real-time, which they in turn are required to provide to home purchasers pursuant to City of Chicago ordinance.
Elevate Energy has reviewed the first seven months of MRED data to provide a snapshot of how energy cost disclosure has performed in the real estate marketplace. The preliminary snapshot looks at single family homes listed between July 1, 2013 and February 19, 2014. The findings describe attributes of the homes that disclosed energy costs and those that did not; the results do not imply causation.
Of the 18,605 single family homes listed on MRED during this time, 10 percent disclosed energy costs. Home listings that disclosed energy costs spent less time on the market. In Lakeview, for example, homes that disclosed energy costs spent a median of 43 days on the market compared to a median of 63 days on the market for homes that did not disclose their energy use. Home listings that disclosed energy costs also had a higher closing rate: 66 percent of homes that disclosed compared to 53 percent for homes that did not. Click here to access the complete analysis.
Energy cost disclosure facilitates more informed decisions for all involved in the real estate transaction. The recent analysis demonstrates the value of energy efficiency in the marketplace.
“Homeowners that invest to improve the energy efficiency of their homes should have a clear, consistent way to document those improvements when they opt to sell, and buyers deserve to be able to get a full picture of homeownership, which includes energy costs,” said Anne Evens, CEO of Elevate Energy. “Our preliminary analysis of the MRED energy disclosure data is encouraging. We’ll continue to analyze the data over time to get a more complete understanding of how listings that disclose their energy costs may or may not set themselves apart.”