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Appraisal Institute Announces Support for Green Real Estate Bill in Congress

October 19, 2011 08:00 AM

CHICAGO (Oct. 20, 2011) – Citing its benefits for consumers, the nation’s largest professional association of real estate appraisers announced support Wednesday for recently introduced federal legislation that would improve the mortgage underwriting process by ensuring energy costs are included.

The Appraisal Institute expressed its backing of the Sensible Accounting to Value Energy Act of 2011 during a news conference at the U.S. Capitol with bill sponsors Sens. Michael Bennet, D-Colo, and Johnny Isakson, R-Ga., and other organizations.

 “We strongly support the SAVE Act because it will improve communication and the flow of information among appraisers, lender clients and those interacting with the mortgage lending process,” Appraisal Institute Immediate Past President Leslie Sellers, MAI, SRA, said at the event. “It would require use of qualified, competent appraisers and would help ensure that appraisers have access to data needed to analyze the effects of energy-efficient home improvements in the marketplace. Consumers would benefit from the bill’s efforts to help ensure they receive a reliable, credible opinion of value.”

The SAVE Act would instruct federal loan agencies to assess a borrower’s expected energy costs when financing a house. The U.S. Department of Housing and Urban Development would issue updated underwriting and appraisal guidelines for any loan issued, insured, purchased or securitized by the Federal Housing Administration or any other federal mortgage loan insurance agency.

The bill establishes two methods for determining expected annual energy costs: average utility costs, derived from the Department of Energy’s Residential Energy Consumption Survey database and adjusted for the square footage of the home, or if available, a qualified, independent energy report of the subject property. The measure includes two primary features: an affordability test and a loan-to-value adjustment.

Sellers said the SAVE Act would help protect taxpayers from another foreclosure crisis; would lower utility bills for U.S. households; would remove from federal mortgage policy an impediment to home energy efficiency; would drive business and job growth in the construction and manufacturing sectors; would expand the accessibility and affordability of energy efficient homes; and would reduce U.S. energy dependence.

“The SAVE Act would require that appraisers are provided with all relevant information relating to energy-efficient features of properties,” Sellers said. “And by defining these types of appraisal assignments as ‘complex,’ the SAVE Act would help ensure those properties are valued by an appraiser with enhanced competency who can more thoroughly analyze and make appropriate judgments for building energy performance and who can help lenders understand their collateral risk.”

In addition to the Appraisal Institute, organizations supporting the SAVE Act include:

  • Alliance to Save Energy,
  • American Council for an Energy-Efficient Economy,
  • Building Energy Efficient Codes Network,
  • Center for American Progress,
  • E2 Environment Entrepreneurs,
  • Earth Advantage Institute,
  • EcoBroker,
  • Efficiency First,
  • Global Green USA,
  • Green Builder Coalition,
  • Institute for Market Transformation,
  • International Code Council,
  • Leading Builders of America,
  • National Association of State Energy Officials,
  • Natural Resources Defense Council,
  • The Residential Energy Services Network, Inc.,
  • Structural Insulated Panel Association and
  • U.S. Green Building Council.

The Appraisal Institute is a leader in green valuation, having developed the Residential Green and Energy Efficient Addendum and the Valuation of Sustainable Buildings Professional Development Program.

Learn more about the SAVE Act from the Institute for Market Transformation, a nonprofit organization dedicated to the promotion of energy efficiency, green building and environmental protection in the United States and abroad.




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The Appraisal Institute is a global membership association of professional real estate appraisers, with more than 24,000 members in nearly 60 counties throughout the world. Its mission is to advance professionalism and ethics, global standards, methodologies, and practices through the professional development of property economics worldwide. Organized in 1932, the Appraisal Institute advocates equal opportunity and nondiscrimination in the appraisal profession and conducts its activities in accordance with applicable federal, state and local laws. Members of the Appraisal Institute benefit from an array of professional education and advocacy programs, and may hold the prestigious MAI, SRPA and SRA designations. Learn more at





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