Sustainability is not just a trend, it is an imperative. To contain climate change, energy consumption and greenhouse gas emissions must be reduced. This is particularly evident in the real estate sector.
Sustainability is becoming more and more important in real estate valuation
We are in the midst of a sustainable change. With the Paris Climate Protection Agreement and the European Green Deal, a climate-friendly or climate-neutral future should be created. To achieve this goal, the real estate sector is of great importance. In the EU, residential and commercial properties are said to be responsible for around 40 percent of total energy consumption and around 36 percent of CO2 emissions. In order to curb climate change, it is therefore essential to make real estate more sustainable. Due to the longevity, sustainability aspects already play a major role in real estate valuations. Anyone who builds a house or buys an apartment today must already be thinking about the future. In addition to the existing sustainability requirements, there will be more, all of which will affect the need for modernization and the attractiveness of the property. Nobody wants to be left with a house or apartment that will soon no longer meet the standards. As a result, the sustainability requirements of tomorrow must be anticipated and priced in today when evaluating real estate.
Fulfilling ESG criteria alone is no longer enough
Anyone who is satisfied with meeting the ESG criteria today should be careful that they will no longer be up to date in the near future. The already mentioned long life cycle of real estate makes it necessary to be ahead of the times when it comes to the future value retention of the house or apartment. As a property owner or buyer, you should always keep an eye on the entire useful life. like dr Alexandra Hildebrandt, expert in business & management, sustainability, digitization, internet & technology, explains on Xing that real estate that does not meet the standards of the future will hardly be for sale in the future. “Objects in which sustainability factors are taken into account holistically will be more in demand on the market,” she continues. Sustainable building would not just be about “ecological/energy efficient building” or “bioclimatic architecture”. Factors such as the choice of location, forward-looking planning, an appropriate deployment of personnel, the use of durable, recyclable, renewable, ecologically and health-safe building materials/elements, user satisfaction or the strategic anchoring of sustainability goals in all operational processes are particularly important.
The energy balance of an apartment is of particular importance
Within this whole host of important sustainability aspects that play a role in property valuation, Dr. Alexandra Hildebrandt, however, emphasizes one criterion: the energy balance of residential and commercial buildings. It therefore has a particularly large weight in the assessment. As Hildebrandt explains, since 2014 it has been mandatory for sellers of real estate and new landlords to present an energy certificate for their property. This provides information about the energy parameters and the resulting greenhouse gas emissions of the building. Efficiency is given on a scale from A+ to H, with old buildings or residential buildings with average consumption usually being in class E. In the course of renting, leasing or selling, the energy certificate must already be presented when the property is inspected. In this way, interested buyers or tenants can get an idea of the energetic condition of the building. Objects with a high level of energy efficiency could score particularly well in terms of property valuation.
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