Energy certification of buildings as a tool for real estate development and to estimate the most likely market value of properties Proposal for an evaluation method that takes energy performance of buildings into account

In order to improve the energy performance of existing buildings, Directive 2002/91/EC introduced the obligation to produce the energy performance certificate in all cases of sale and lease of buildings or individual housing units. The certification aims to provide information on energy quality of buildings and clear and immediate tools for purchases and leases of properties that take proper account of their energy performance, as well as to evaluate the cost-effectiveness of implementing energy renovations of homes. However, at present, in spite of this fulfillment, the estimation procedures normally used to determine a property’s most likely market value do not consider the energy class, nor eventually achievable performance, thus not allowing to achieve the goals set by the EU. In this context, it is therefore essential to be able to associate the energy performance of a property with a corresponding economic value to consider in the estimation procedures. In fact, energy performances fully fall among the quantitative typological characteristics of a property under evaluation, being determinant for the indoor comfort and for management costs. The article presents an innovative method for estimating the most likely market value of a residential property unit according to the method of income capitalization approach, that takes into account information on its energy performance as obtainable by the energy performance certificate. The proposed method has been applied for the evaluation of several habitation units for sale in Italy in the cities of Rome and Milan under the different assumptions that the energy performance of the properties being valued could or could not be improvable following energy retrofit interventions. The method applied highlights important differences in the market value of real estate class A and G, which can reach up to over 800 €/m2. The method, developed for Italy, can be easily adapted to any other EU country