I'm starting to feel sorry for myself :-(... nah, I know I shouldn't, but it's been tough because I am finding that this house and lot appraisal method is so frustrating because we are building green.
Why? You see, in order to get a construction loan for your house, you have to get your houseplans and lot appraised so that the lender can base the loan on the total appraised value. They basically compare your house square footage and the area where you're building and try to find comparables in the neighborhood. The problem is, there aren't too many green built homes to compare to, so they end up comparing your house to the shoddy stick builts and it's simply NOT FAIR!!! I've been talking to appraisers around town and they are saying the same thing... it doesn't matter because we have to go by what is around you. So tell me, how are we going to get comparables around us when they make it so hard for people to build green in the first place? Add the fact that they don't appraise green features/building for a higher value, even though you're saving thousands a year in energy costs, you're not breathing dangerous vapors, as well as being the benevolent and eco-conscious hero of your neighborhood.
And so I ranted and vented and said, but we're building with SIPs, got geothermal and rainwater collection and all these other cool features but to no avail. I am so thinking of going political over this. If anyone has any insight on how I can go about lobbying for making it easier for green built homes, then I'm very open to suggestions and will put on my marching boots.
Here's our situation, and I'll be an open book (as if I haven't already exposed enough):
We need to appraise both our house and lot at about $740K so that we can get 100% financing for our construction costs which came to be approx $590K (80% of the appraised value). This allows us to put no money down because in essence we are using our equity for the 20%.
We are doing this as owner builders with U Build It. And if that's not hard enough, building green can be costly upfront, and so we require more of a loan than if we went conventionally stick built. Then add on the fact that the nation is under a house decline....
We did find ONE appraiser who has specialized in green building in Austin, can you believe that? Here's his info (free PR for him):
Ward Appraisal Services
Also, here's a mortgage company specializing in green building lending:
Green Mountain Mortgage
I guess when people build green, it's their 2nd or 3rd or more house, but we are the pioneer-spirited ones who decide to build our very 1st home properly and green! Woohoo! :-D
The hope is that our land has appreciated enough to cover any large differences. Acreage lots around the Hill Country are getting expensive, so maybe that will be a good thing for us. It's almost becoming a mini California out here. They even built the Hill Country Galleria 8 miles from us and will be developing out this way.
Despite the above, I am trying to stay positive. Really truly, because we deserve this house and want to do it right!!! I am SO HOPING we get the appraisal we want. Wish us luck and as always I'll update with what I find out!
I should do a before and after picture of us when we start the building....
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I just saw your note above, and I am surprised that I am the first to make some comments on your situation. If you want to believe it or not, most of "us" have and will have similar experiences. The reason is actually very simple: "Stick-Built construction is not only a way to build, it is a very powerful "religion" in North America!"
You may not agree, but this is a fact. Green Builders are a minority, and thanks to these good people on this site, it will change over time. Every aspect in construction is regulated by building codes, education, literature and trades involved in stick-built construction. Who are the big sponsors in the field of construction education? Like everything else in this beautiful world of ours, politics play a big role ............. if it makes sense or not.
Don't give up, you are a pioneer!
Wolf
I can relate!
I totally hear you on this problem. We've been through something very similar. We wanted to be Pioneers, and at times, this feels more like being the sacrificial lamb, don't you think? You spend so much more on your building envelope to ensure significantly better energy bills, and this equates to no $$, yet an energy hog swimming pool would actually add value to your property? Go figure. As I recall, there is the approach to appraisals where you compare the structure to other "comps" and then there's also the "build it from scratch" method. So why can't they find a happy medium some place in between?
I guess my post is of no help... but... I just want to let you know, you're not alone!
*Lisa
"When one tugs at a single thing in nature,
he finds it attached to the rest of the world."
John Muir
financing
I have been financing straw bale, rammed earth, off grid and on grid homes for many years.
Typically at resonable rates thru Fannie Mae and Freddie Mac.
I have rewcived calls from people in a panic about their financing and find the apprasier has really not addressed the property correctly nor did the apprasier have an understanding of the actual type of property they were apprasing.
As I say on my website 80% of funding a straw bale, log home, off grid home, etc is the apprasail report. The loan officer needs to know what the underwriter of the loan is looking for in a report. I have been very fortunate thru the years to stumble upon apprasiers that have provided me with great reports which I use as examples when speaking to a new apprasier on a new project.