Increase Buying Power with an Energy-Efficient Home
Increase Buying Power with an Energy-Efficient Home
As a BC REALTOR® you’ve probably informed your clients about the benefits of purchasing an energy-efficient new home over the years. Such as greater comfort, reduced heating costs, and being more environmentally friendly. There is however another significant benefit to purchasing a Power Smart new Home – greater buying power when applying for a mortgage. Sound too good to be true? It’s not. Banks are in the business of lending money, and as long as the numbers make sense, your clients may be eligible to borrow more money to buy the house of their dreams. Alma Pasic, Director of Mortgage Solutions with Verico AM Financial Solutions explains, “In order to determine a client’s mortgage potential we calculate a few variables including principal, interest, property tax, condominium fees when applicable, and heating. If the home uses 30 to 50 per cent less heat than the average home, we take that into consideration, and we may be able to provide our clients with greater mortgage options.” Banks use the Total Debt Service (TDS) formula to calculate mortgage potential, and they understand that when new homeowners spend less each month on heating costs, they have that extra money in heat savings available to them to put towards their mortgage. “The bottom line is that banks have more lending power when approving a mortgage with a client who is purchasing a Power Smart new home - these homes receive an Energuide rating of 80 or higher,” says Sarah Yada Seto, Power Smart New Home program manager. “By maximizing energy efficiency, Power Smart new homes can use up to 30 per cent less energy, making them more affordable. These savings result from extra insulation, better air sealing and heating, and ENERGY STAR labelled appliances and lighting systems. A greater number of developers are starting to understand the value of building energy-efficient homes that exceed regular building code regulations. They recognize that buyers not only want more comfortable and healthier homes, but they need homes that cost less to operate, especially when buying houses in BC that often come with large mortgages attached. “One of the main reasons why we are starting to build more energy efficient homes is largely due to the fact that we as a company are spending more time educating our clients on the benefits of "building green." Solar panels, heat pumps, tankless water heaters, rain barrels, fluorescent lighting, automated skylights (as opposed to A/C), even residential wind turbines are all innovations that we like to recommend to our clients,” says Philip Jiang, Marketing Manager with Odenza Homes. “Although the initial cost can be a bit more expensive than your average home, the cost savings over the long run is definitely a positive. Other incentives include increased property value, larger mortgages, and incentives by BC Hydro. So the next time one of your clients asks about the benefits of an energy-efficient home, of course mention that it reduces operating costs, provides a more comfortable place to live, and is overall better for the environment; however, a valuable selling point will be that they will have greater borrowing power when applying for their mortgage. Learn the key features of a Power Smart new home, and find out more information on current Power Smart new homes in your area.
Evon Mayer Sutton Group - West Coast Realty
604.418.5786 (c) evon@evonmayer.com www.evonmayer.com
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