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Energy Performance and Housing Prices

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  • Pontus Cerin
  • Lars G. Hassel
  • Natalia Semenova

Abstract

ABSTRACT We investigate whether mandatory energy performance certificates of existing residential properties contribute to property price premiums after the implementation of the EU directive on the energy performance of buildings in the Swedish private housing market. Analysing mandatory energy performance certificates of the 2009–2010 private housing transactions, we find that energy performance is associated with transaction price in situations when it is conditional on a reference benchmark. We also document property price premiums for energy performance within housing segments built before 1960 and those with a lower transaction price per square metre. Our results suggest that the property market values energy performance, and we make recommendations on which housing segments need policy support to encourage energy improvements. Copyright © 2014 John Wiley & Sons, Ltd and ERP Environment.

Suggested Citation

  • Pontus Cerin & Lars G. Hassel & Natalia Semenova, 2014. "Energy Performance and Housing Prices," Sustainable Development, John Wiley & Sons, Ltd., vol. 22(6), pages 404-419, November.
    • Handle: RePEc:wly:sustdv:v:22:y:2014:i:6:p:404-419
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    1. Matheus Koengkan & José Alberto Fuinhas, 2022. "Heterogeneous Effect of “Eco-Friendly” Dwellings on Transaction Prices in Real Estate Market in Portugal," Energies, MDPI, vol. 15(18), pages 1-18, September.
    2. Taruttis, Lisa & Weber, Christoph, 2022. "Estimating the impact of energy efficiency on housing prices in Germany: Does regional disparity matter?," Energy Economics, Elsevier, vol. 105(C).
    3. Marmolejo-Duarte, Carlos & Chen, Ai, 2022. "Uncovering the price effect of energy performance certificate ratings when controlling for residential quality," Renewable and Sustainable Energy Reviews, Elsevier, vol. 166(C).
    4. Taruttis, Lisa & Weber, Christoph, 2020. "Estimating the impact of energy efficiency on housing prices in Germany: Does regional disparity matter?," VfS Annual Conference 2020 (Virtual Conference): Gender Economics 224582, Verein für Socialpolitik / German Economic Association.
    5. Sieger, Lisa & Weber, Christoph, 2023. "Inefficient markets for energy efficiency? – The efficiency premium puzzle in the German rental housing market," Energy Policy, Elsevier, vol. 183(C).
    6. Hyunjoo Lee & Misuk Lee & Sesil Lim, 2018. "Do Consumers Care about the Energy Efficiency of Buildings? Understanding Residential Choice Based on Energy Performance Certificates," Sustainability, MDPI, vol. 10(11), pages 1-18, November.
    7. Copiello, Sergio, 2017. "Building energy efficiency: A research branch made of paradoxes," Renewable and Sustainable Energy Reviews, Elsevier, vol. 69(C), pages 1064-1076.
    8. Wahlström, Marie H., 2016. "Doing good but not that well? A dilemma for energy conserving homeowners," Energy Economics, Elsevier, vol. 60(C), pages 197-205.
    9. Franz Fuerst & Ben Dalton, 2019. "Gibt es einen wissenschaftlichen Konsens zur Wirtschaftlichkeit nachhaltiger Immobilien? [Is there a scientific consensus on the economic viability of sustainable buildings?]," Zeitschrift für Immobilienökonomie (German Journal of Real Estate Research), Springer;Gesellschaft für Immobilienwirtschaftliche Forschung e. V., vol. 5(1), pages 173-191, November.
    10. Luiz de Mello, 2023. "Real Estate in a Post-Pandemic World: How Can Policies Make Housing More Enviromentally Sustainable and Affordable?," Hacienda Pública Española / Review of Public Economics, IEF, vol. 244(1), pages 111-139, March.
    11. Mats Wilhelmsson, 2019. "Energy Performance Certificates and Its Capitalization in Housing Values in Sweden," Sustainability, MDPI, vol. 11(21), pages 1-16, November.
    12. Chegut, Andrea & Eichholtz, Piet & Holtermans, Rogier, 2016. "Energy efficiency and economic value in affordable housing," Energy Policy, Elsevier, vol. 97(C), pages 39-49.
    13. Pride, Dominique & Little, Joseph & Mueller-Stoffels, Marc, 2018. "The value of residential energy efficiency in interior Alaska: A hedonic pricing analysis," Energy Policy, Elsevier, vol. 123(C), pages 450-460.
    14. Verbič, Miroslav & Filipović, Sanja & Radovanović, Mirjana, 2017. "Electricity prices and energy intensity in Europe," Utilities Policy, Elsevier, vol. 47(C), pages 58-68.
    15. Aydin, Erdal, 2016. "Energy conservation in the residential sector : The role of policy and market forces," Other publications TiSEM b9cedba8-1310-4097-90fb-b, Tilburg University, School of Economics and Management.
    16. Andrea Chegut & Piet Eichholtz & Rogier Holtermans & Juan Palacios, 2020. "Energy Efficiency Information and Valuation Practices in Rental Housing," The Journal of Real Estate Finance and Economics, Springer, vol. 60(1), pages 181-204, February.
    17. Florian Fizaine Fizaine & Pierre Voye & Catherine Baumont, 2018. "Les études hédoniques soutiennent-elles une valeur verte élevée dans le bâtiment ? Une réponse par la méta-analyse," Post-Print halshs-01957447, HAL.
    18. Lisa Taruttis & Christoph Weber, 2020. "Estimating the impact of energy efficiency on housing prices in Germany: Does regional disparity matter?," EWL Working Papers 2004, University of Duisburg-Essen, Chair for Management Science and Energy Economics.
    19. Maria-Francisca Cespedes-Lopez & Raul-Tomas Mora-Garcia & V. Raul Perez-Sanchez & Juan-Carlos Perez-Sanchez, 2019. "Meta-Analysis of Price Premiums in Housing with Energy Performance Certificates (EPC)," Sustainability, MDPI, vol. 11(22), pages 1-59, November.
    20. Khazal, Aras & Sønstebø, Ole Jakob, 2020. "Valuation of energy performance certificates in the rental market – Professionals vs. nonprofessionals," Energy Policy, Elsevier, vol. 147(C).
    21. Jussi Vimpari, 2020. "Financing Energy Transition with Real Estate Wealth," Energies, MDPI, vol. 13(17), pages 1-10, August.
    22. Federico Dell’Anna & Marina Bravi & Carlos Marmolejo-Duarte & Marta Carla Bottero & Ai Chen, 2019. "EPC Green Premium in Two Different European Climate Zones: A Comparative Study between Barcelona and Turin," Sustainability, MDPI, vol. 11(20), pages 1-21, October.
    23. Pasichnyi, Oleksii & Wallin, Jörgen & Levihn, Fabian & Shahrokni, Hossein & Kordas, Olga, 2019. "Energy performance certificates — New opportunities for data-enabled urban energy policy instruments?," Energy Policy, Elsevier, vol. 127(C), pages 486-499.
    24. Marmolejo-Duarte, Carlos & Onecha-Pérez, Belén, 2021. "The spatial uneven difussion of energy-efficiency transparency policy. An analysis of the multi-family market in Barcelona," Energy Policy, Elsevier, vol. 156(C).
    25. Riccardo Camboni & Alberto Corsini & Raffaele Miniaci & Paola Valbonesi, 2023. "CO2 emissions reduction from residential buildings: cost estimate and policy design," "Marco Fanno" Working Papers 0304, Dipartimento di Scienze Economiche "Marco Fanno".

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