Investment properties have showcased a rise in value after shifting towards “green buildings.” This new trend is the overall context of utilizing natural resources, minimizing the use and emission of carbon fuel, and adopting a healthy design for the environment. It’s even safe to say that the trend affects businesses across the globe. Green buildings will surely be the investment of choice.
Climate change is something we can’t look over, affecting our lives when we least expect it. The truth is, green building not only lessens the emission of CO2 within the vicinity, yet a collective reduction and or omittance of such can lead to us saving mother earth.
What is “Green Building”
Simply put, this emerging trend is a real estate property designed and structured to sustain and maximize environmentally friendly assets. Moreover, it can also be renovated or refurbished properties that lean towards environmentally friendly practices. For example, using green building materials, window placement for lighting, and implementing environmentally friendly technologies of the aforementioned real estate properties.
One of the reasons why commercial buildings have yet to claim or imprint the idea of being part of the “green building” trend is due to certification. The idea is, to even consider putting it on paper, “green buildings” are accredited by the LEED (Leadership in Energy and Environmental Design).
The asset of being certified not only can promote business and market values, but it can also generate consumer and employee satisfaction. In the end, it would benefit the investors who partake in such a corrective course of action.
Here are three reasons green property management may affect the real estate industry and invest in the said properties.
Green Buildings Ensure A Hefty Return For Real Estate Investors
As a real estate investor, you are pretty hesitant to invest in green buildings. The construction may be costly, and the time needed for construction may take longer than usual. In an industry that will involve many risks to ensure a profitable return, investing in green buildings will be one of them.
The science and math behind it all would be that green buildings’ market value can rise to 30% from its original price. Not only that, green buildings are easy to market and have shown a higher percentile in occupancy for green rental spaces. With that being said, the return on investment would already be of a higher caliber than what was shelled out, and a continuous and fruitful cash flow may occur due to the occupancy rate.
Demanding a higher rate for rentals, selling the property for up to 30% above market value, and increasing asset value over time. Investing in green properties may be the best choice especially if you have the extra budget. Save the planet while assuring the returns in your pocket.
With a demographic that showcases Millenials and boomers slowly taking over the real estate market, it would be a wise choice to focus on buyers that will easily take those properties off your hands. The buy and hold tactic may be of minimal success with the rise in demand and lack of supply in the real estate industry.
Many real estate investors fail to see that investing in green buildings may only seem costly on the initial purchase. It’s because of the prices for the materials used, the resources needed for the structure, and so much more. However, they haven’t considered the aftermath of the initial investment.
Environmentally friendly equipment may be heavy offset. However, as time progresses, the cost will be minimal in line with consumption and everyday use. The reason behind it is green buildings will minimize the cost of energy and electrical consumption. The structure will focus on using natural energy and the minimal need for electrical equipment.
Using green building technologies throughout the building’s life cycle will prove beneficial since it is assumed that major cost savings can be achieved through the concept and context of conservation. Conservation of energy and water resources will already have a huge effect on the overall reduction in costs. These renovations and improvements will also serve as an ease in the maintenance of equipment within the building.
Social Environmental Benefits
From a social and economic perspective, green buildings can affect real estate investments. Social and Environmental benefits can be measured with what real estate investors may enjoy, such as lower greenhouse gas emissions, lessened water pollution, and better public health amenities. Things like this affect the decision-making process of potential customers and tenants.
Not only will you limit the price to something that suits your favors and returns, however, asking for high rental rates will be justifiable. In general, people want to enjoy the properties and or workspaces they are in, knowing that they are silently helping the environment. That minimal sense of fulfillment is appreciated by real estate investors who consider green property management.
As we conclude the reasons as to why you should consider investing in green property management, think of yourself as an individual willing to save the planet you live in. We aren’t getting any younger, and besides the perks offered by investing in such a property, you can also enjoy the benefits of conservation of energy and natural resources.
We should maximize what mother nature offers and slowly realize that we never needed to overlook what we are currently trying to take advantage of. Green buildings will mold the future of the real estate industry, and it is not limited to structures that you see in the city. Your home can be the next “Green Building” out there while inspiring your community to do the same.
Disclaimer: The blog articles are intended for educational and informational purposes only. Nothing in the content is intended as legal or financial advice.