Driven by the cost saving for home buyers and incentives offered by state governments, an increasing number of developers are now greening their residential portfolios.
Today’s real estate buzzword is definitely colorful-green! And since these type of buildings are not really painted that verdant hue they can be hard to identify. So, what exactly are green homes?
A green home is built with a much larger home in mind – the planet earth. A straightforward nuts and bolts description of it is that these are homes that efficiently use resources like power and water and minimize pollution. The term ‘green home’ means different things to different people. Some only consider a home green, if it lives up to the highest LEED rating or the Indian Green Building Council’s (IGBC) rating standard while there are others who are less interested in the formalities of certification. In general, a green home uses less energy and is built with more sustainable building materials compared to a conventional home.
Buildings account for almost 40% of India’s overall energy consumption, and more than 60% of all buildings being developed in the country are residential projects. It is, thus, imperative to incorporate the effective use of site resources, water conservation, energy efficiency, handling of household waste, optimum material utilization and design for healthy, comfortable and environmentally-friendly homes, thus leading to the development of what we call green homes. There is more to going green than pure humanitarian reasons for preserving the planet. In fact, there are enough financial as well as health reasons driving the green home trend to evolve in India. Although the concept is still at a nascent stage, awareness about this new way of life is gaining ground. People are now evaluating these eco-friendly homes owing to the health benefits they offer in the long run. There are several benefits green homes offer to buyers, which considerably reduce the cost of daily necessities.
Financial impact: Operating costs like electricity and water kick off from the day one through the entire lifecycle of the building. The bills for these services shoot up during the summer months when the consumption is higher. Green homes are built in a way, which is aimed at receiving natural lighting and air with the minimal use of conventional electricity using solar panels, rain water harvesting, ground water recharge with sustainable withdrawal and reuse of waste water through treatment. All of these can end up reducing the monthly bills by up to 20%-30%, depending upon the level of energy saving mechanisms plugged into the project.
Impact on health: Uninterrupted air circulation, natural air filtration through the optimum use of plants, use of solar chimneys and exhaust fans, enhanced natural lighting through windows and natural paints, all work towards enhancing the quality of living. Dependence on electrical appliances for lighting, heating, air filtration, etc. can get tremendously reduced which seems to have become a way of life nowadays.
Lifestyle Benefits: With a focus on sustainable development, builders look for incorporating eco-friendly substitutes for construction like bamboo, recycled metal, structural insulated panels and natural clay plaster. The use of eco-friendly material, furniture and light-colored interiors help in uplifting the overall quality of life.
Though the Indian market’s response to green buildings is increasing with each passing year, there are still quite a few projects that are not fully there in terms of getting a full-fledged rating. Many of them have not complied with 100% of the requirements to qualify as a green home to keep a check on the overall project costs. A number of them use this as more of a marketing gimmick rather than a true energy saver. There are developers like Tata Housing, VBHC, BCIL who have already developed a green template along with prominent players like Godrej, Hiranandani, Raheja, etc. building certified green homes.
Driven by the cost saving for home buyers and incentives offered by state governments, an increasing number of developers are now greening their residential portfolios. Given the current market scenario with pressure on sales, it is important to differentiate the product offering. Green homes provide a tangible value proposition to a buyer, and would definitely help attract buyers as well as investors if done in the right context.
(By Divya Seth Maggu, Associate Director, Valuation & Advisory Services, Colliers International India)