Net Zero Homes: The Complete Guide for Investors

Buildings are some of the biggest consumers of energy in our world today. The Alliance to Save Energy estimates that buildings are responsible for 40% of all U.S. energy consumption. Due to concerns about greenhouse gas emissions and rising energy prices, many people are now embracing the concept of net zero homes.

What Are Net Zero Homes?

Also referred to as zero net energy homes, net zero homes are those that generate as much energy as they use. They do this by harnessing renewable energy sources and maximizing efficiency. Net zero homes are constructed using advanced building methods that promote energy conservation and production. Common features of such homes include natural ventilation, passive solar heating, high-performance envelopes, sun control, and shading devices, and water conservation.

Besides solar heating, you can meet the energy needs of a net zero home through onsite renewable energy sources like photovoltaics (PV), wind turbines, biomass, or biofuels. Alternatively, you can rely on off-site renewable energy sources like solar plants, geothermal plants, wind farms, and hydropower facilities.

There are 3 bodies that certify zero-energy buildings:

New Buildings Institute: Besides building net-zero homes and certifying them, this organization provides resources and education to support real estate investors, managers, and developers seeking to get NZE in their buildings. The New Buildings Institute also keeps a database of net-zero-certified buildings
International Living Future Institute: Zero Energy: To get this certification, a building has to self-supply 100% of its energy onsite with zero combustion
S. Green Building Council’s LEED Zero: Buildings that have already acquired LEED certification can get this further certification

Benefits of Net Zero Energy Homes

Here are some of the amazing benefits of owning a zero energy home:

Tax incentives: You don’t have to acquire a third-party certification in order to enjoy the cost savings of net-zero energy. However, getting certified is a good idea since it allows you to apply for incentives from your state. For example, some states offer a tax credit to homes that use federally-approved solar technologies. To learn more about the incentives for energy-efficient homes, check out the Database of State Incentives for Renewables and Efficiency (DSIRE) website
Lower energy bills: People that build net zero energy homes save a lot on energy bills. Since such homes are built thoughtfully and efficiently, they require little or no energy from the energy grid. At times, net zero energy homes are even able to supply clean energy back to the grid. For this, homeowners are compensated by their city
Higher resale value: With the increasing popularity of net zero energy homes, their resale value continues to rise. Many don’t have the patience or time to build such a home and would prefer buying one that is move-in ready. With the increasing demand, real estate investors can be assured of a good return on investment
Superior insulation quality: One of the main features of a net zero energy home is its strong insulation properties. The superior insulation quality ensures that heat gain is minimized in summer and heat loss minimized in winter. As a result, property owners don’t have to worry about paying for cooling or heating leaks in the home
Minimizing your carbon footprint: When you invest in net zero energy homes, the environment is the main beneficiary. Resources are well preserved and greenhouse gas emissions are greatly reduced. You can have peace of mind knowing that your home is eco-friendly
Comfortable living space: The living quality in net zero energy homes is incomparable. Your tenants will enjoy isolation from outdoor noise, stable temperatures, and indoor air quality

Why You Should Consider Net Zero Prefab Homes

Also referred to as modular homes, prefabricated homes are homes constructed mainly in a factory before being transported to a site for final assembly. Here are some of the reasons why purchasing prefab net zero homes is a good idea:

Durability: Since they are built in a factory, prefabricated homes are precision engineered for greater durability. Such buildings experience minimal structural damage during hurricanes and other natural disasters
Less waste: Prefabricated home builders can accurately estimate how much material is needed for the job, thus minimizing waste. In addition, materials are less likely to be get damaged, vandalized, or stolen
Shorter construction time: Since most of the building is completed indoors, modular homes can be constructed in less time than traditional buildings
Good for remote locations: If you want to invest in a remote location, prefab homes are the best option. You won’t have to worry about finding contractors willing to travel a long way to build your home

Where to Find Net Zero Homes for Sale

Just like regular homes, you can find net zero homes advertised in newspapers or magazines. You can also check on real estate sites like Zillow, Trulia, Realtor.com, FSBO.com, Foreclosure.com, or Mashvisor. However, the best to look is in zero energy home directories such as:

Zerohomes.org
Net Zero Building
Net Zero Energy Coalition Member Directory
S. Department of Energy Tour of Zero

If you prefer to build a home from scratch, search Google for zero energy home builders in your state or city. To ensure you select a credible zero energy home builder, it would be advisable to visit the U.S Department of Energy’s website. You will find builders that have met the requirements for the Zero Energy Ready Home program. In addition, you will see a list of verified architects and designers, innovation partners, and training partners.

Financing a Zero Energy Home

How to get financing for net zero homes

There is a special kind of financing for zero energy homes – the Energy Efficient Mortgage (EEM). Whether you are purchasing an energy efficient house or remodeling an existing property, you can apply for an EEM. This application can be made through a conventional or government-insured loan program. Some states also have programs specially designed for their residents. You can get more details from the state energy office.

To qualify for an EEM, you are required to get a home energy assessment from a licensed certified energy rater. The energy rater will look at energy-related features in the home such as window efficiency, air leakage, heating and cooling systems, and insulation levels. After the inspection, the rater will generate a report that shows the home’s energy rating and an approximation of annual energy costs and use. The report might also suggest energy upgrades and estimate their cost. You could choose to include the suggested upgrades as part of the loan.

Mortgages for energy-efficient homes work in the same way as mortgages for conventional homes. Before approving your loan application, the lender will also look at things such as:

Your income and expenses
Your credit history
The loan-to-value ratio
Your employment history
Your existing debt payments

Conclusion

You will find a net zero community in almost every state in the U.S. Here are some examples to check out:

Kaupuni Village in Hawaii
Living Zenith in Utah
Red Fox Crossing in Wisconsin
DeYoung EnVision in California
The Zero Home in Utah

If you are looking for a net zero home for sale, these communities would be a great place to start. Take note that due to their high performance and energy-efficient features, net zero homes cost more than comparable standard homes.

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