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June 19, 2006: Number of Green Home Builders Continues to Grow

June 19, 2006
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WASHINGTON - Results of a McGraw-Hill Construction/National Association of Home Builders (NAHB) survey indicate that 2005 saw a 20 percent increase in the number of home builders producing green homes. The study indicates that number will grow by another 30 percent this year.

The new Residential Green Building SmartMarket Report details these findings as well as additional information on the green home movement.

After several years of slow but steady growth across the country, green home building - which applies environmentally sensitive construction techniques and products to reduce energy and water consumption and improve residential comfort and safety - is moving more into the mainstream. By 2010, the value of the residential green building marketplace is expected to boost its market share from $7.4 billion and 2 percent of housing starts last year to $19-38 billion and 5-10 percent of residential construction activity.

"Green home building is not a fad, but a trend, and one that is increasing at rapid rates," said Harvey Bernstein, vice president of Industry Analytics and Alliances for McGraw-Hill Construction. "The data we recently collected indicates builders will reach the tipping point by early next year, where more builders will be producing green homes compared to those not."

This finding is a powerful one, Bernstein said. "With more builders creating green homes, and more consumers buying them, the rest of the industry will follow and increasingly begin to incorporate green features or practices into their homes and home building products."

"It's clear that more and more of our members are incorporating environmentally sensitive and resource efficient techniques into traditional home building practices," said Jerry Howard, NAHB executive vice president and CEO. "It is a natural progression as home builders stay atop market trends."

According to the survey results, the leading reason that builders are considering green is that "it's the right thing to do," Bernstein said. Of those polled, 92 percent identified this factor as a very or somewhat important influence behind the decision to go green.

Other prominent influences include lowering lifecycle costs, such as increased energy efficiency, 87 percent; staying ahead of the competition or expanding business with customers who are interested in green building, 82 percent; and limiting exposure to liability on such issues as water leaks and mold, 78 percent.

Obstacles remain, the survey showed. Starting costs and the lack of interest by consumers to pay additional costs for a green home are perceived as a barrier by 82 percent and 79 percent of firms surveyed, respectively. Also rated as important were educating the marketplace on green building concepts (by 79 percent) and revising codes, ordinances, and regulations (72 percent). Only 39 percent said that the perception of green building as a fad and not something here to stay was a significant roadblock.

To order a copy of the report, go to www.analyticsstore.construction.com or www.builderbooks.com.

Publication date: 06/19/2006

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