Appraising Green Residences

Final Exam Answer Key

  1. The gas used between panes in high end thermal window is
  2. argon.
  3. helium.
  4. krypton.
  5. oxygen.

Correct Correct answer is C. Krypton gas is used in high-end windows. a is incorrect; although argon is used, the high end windows use krypton; helium (b) and oxygen (d) are not used at all. “The gas between the panes is most commonly Argon, although upper end windows use krypton gas. Many thermal windows also have a low-E (Low-Emittance) coating.”

  1. Although ground source and geo-thermal tend to be used interchangeably to describe heat pumps, geo-thermal energy is actually
  2. energy generated and stored in the earth.
  3. a limestone spring.
  4. solar energy stored in minerals.
  5. an underground river.

Correct answer is A.. Energy generated and stored in the earth.” Geo-Thermal energy: Energy which is generated and stored in the earth. About 20% of the geothermal energy of the earth’s crust is from the origins of the planet; 80% is from the radioactive decay of minerals. A common example of geo-thermal energy is a hot spring, or geyser”. B and c are things found underground, but they do not generate energy; c solar energy stored in minerals is not an occurrence in nature.

  1. An infra-red camera is used to
  2. detect radon and VOCs in a house.
  3. determine the aura of a house.
  4. determine how air tight the house is.
  5. determine patterns of heat loss in a structure, in an energy audit.

Correct answer is D. Infra-red thermal definition. Infra-red Thermal camera: A camera used in home inspection that can reveal “hot” and “cold” spots in a house, as well as water infiltration and leaks. A is wrong because infra red cameras do not detect VOCs and radon; b is wrong because an “aura” refers to the supposed energy circle around a person that a psychic sees; c is incorrect because a blower door test is used for this.

  1. An open loop heat pump requires
  2. an existing body of water, like a well or pond.
  3. a large land area.
  4. a small land area.
  5. solar panels.

Correct answer is A. There are also open loop heat pump systems. These use an existing body of water, either a well or surface body water (like a pond). This functions as the fluid for the heat exchange system, and it circulates directly through the system b, c and d are incorrect, due to the definition, which clearly states an existing body of water is required.

  1. Which is correct regarding solar panels?
  2. They are not maintenance free.
  3. They can generate sufficient energy that the home owner can sell power back to the power company.
  4. They have a short payback period.
  5. Their life expectancy is 70+ years.

Correct answer is B. Solar panels allow the homeowner to sell energy back to the power company. As of this writing, the life expectancy of a typical solar panel is less than 20 years; the owners who installed these panels took advantage of federal and state tax credits, as well as grants from the power company which were in place at that time. The payback period for solar panels will vary considerably by climate and region of the United States. In the northern United States, without any tax incentives or grants, the payback period for these panels exceeded their life expectancy, which would have made them unfeasible without the tax credits and grant. However, as stated above, in the southern and western United States, particularly places like Arizona and California, companies are renting roof space to install solar panels because the payback period is much less.Solar panels are not maintenance free; they need to be cleaned, as one would clean a window. As of this writing, the expected payback period in some climates does not equal the expected physical life of the panels, making them economically unfeasible, unless tax credits or other incentives are offered.

  1. Which statement is correct regarding ground source heat pumps?
  2. All ground source heat pumps are closed loop systems.
  3. The ground source temperature across the United States is a steady 50 degrees Fahrenheit.
  4. They utilize the fact that the ground source temperature is steady, and is generally much warmer in winter than the outside temperature; and much cooler in summer than the outside temperature.
  5. Vertical loop systems are not used for large buildings.

Correct answer is C. Ground source refers to the constant temperature of the earth at a certain depth, year round. The temperature will vary depending upon where in the United States you are. For example, in Pennsylvania, the average temperature is 50 degrees Fahrenheit. Using a ground source heat pump means that in the winter, when the outside temperature is 20º F, the heat pump only has to heat the air or water from 50º F, not 20º. It is much easier to bring the inside temperature up 20º, rather than 50º. In the summer, instead of trying to work with outside temperature that could be in the upper nineties, instead the heat pump is utilizing the steady 50º in the earth to help cool the house down a is incorrect because we describe open loop systems; b is incorrect because the text points out that the ground temperature varies; d is incorrect because it is exactly wrong; vertical loop systems are used for large buildings.

  1. Which is correct about solar voltaic shingles?
  2. They are more obvious and intrusive than solar panels.
  3. They are an older product than solar panels.
  4. The payback period for these shingles makes them feasible in all climates.
  5. They require an inverted to convert direct current (DC) to alternating current (AC).

Correct answer is D. Top of same page: “The photovoltaic shingles are a newer product, first available around 2005. They blend in with existing shingles and have a better appearance…..because most homes and businesses run on AC, an inverter must be installed to convert to DC…” a is incorrect because they are less obvious and intrusive; b is incorrect because they are newer; c is incorrect because no information was given about payback period.

  1. Which of the following types of insulation is a good choice for ducts or unconditioned spaces?
  2. blanket, or batt
  3. rigid fibrous or fiber insulation
  4. rigid foam
  5. SIPs

Correct answer is B.Rigid fibrous or fiber: “used in ducts in unconditioned spaces; a good use for a place that must withstand high temperatures.” Under blanket or batts, it is noted that these are fitted between studs, joists and beams, making it incorrect; rigid foam is used on unfinished walls and covered with drywall; SIPs are panels made off site and used in new construction.

  1. When shopping for insulation and windows, what should consumers remember?
  2. The higher the R value for insulation, and the higher the U value for windows, the more energy efficient the house is
  3. The higher the R value for insulation, and the lower the U value for windows, the more energy efficient the house is
  4. The lower the U value for windows, and the lower the R value for insulation, the more energy efficient the house is
  5. The lower the R value for insulation and the higher the U value for windows, the more energy efficient the house is

Correct answer is B. Higher R values = better insulation; lower U values = more energy efficient windows. Reference, Chapter 1, page 12 for windows & U value; page 11, introductory paragraph: “With R values, the higher the number, the more effective the insulation.”

  1. What test is conducted using a powerful fan and a pressure gauge, which should be calibrated?
  2. a blower door test
  3. an infra-red camera picture, showing energy loss
  4. a mold inspection - the presence of mold indicates the house is too tight
  5. a radon inspection - the presence of radon indicates the house is too tight

Correct answer is A.Blower door test. “Blower Door Tests- These are used to determine how airtight a house is.”

  1. Which of the following does not contribute to poor indoor air quality?
  2. adequate ventilation
  3. green plants
  4. the use of low or no VOCs
  5. the use of Volatile Organic Compounds (VOCs) in paint, varnish, etc.*

Correct answer is A. Houses need to be relatively air tight, but they also need to have good ventilation. According to the EPA: “Indeed, studies of human exposure to air pollutants by EPA indicate that indoor levels of pollutants may be 2 to 5 times – and occasionally more than 100 times – higher than outdoor pollutant levels. Indoor air pollutants have been ranked among the top five environmental risks to public health. The problems they cause can be subtle and do not always produce easily recognized or immediate impacts on health.

  1. For most consumers, the major energy cost is
  2. cooling.
  3. cooking.
  4. heating.
  5. water heating.

Correct answer is C. “Heating is the biggest chunk of energy costs for a homeowner…”.

  1. Which of the following items would typically be, in the judgment of an appraiser, a relevant characteristic?
  2. the fact that the current owner has a high mortgage on the property
  3. the fact the property is owned by an estate
  4. replacement windows with a low U rating
  5. the size of the half bath or powder room

Correct answer is C. A replacement windows with a low U rating, Chapter 2, definition of relevant characteristics; this answer requires minimal reasoning. a is incorrect; the amount of debt on the property has no bearing on value; b is incorrect; whether the owner is a person or an estate has no bearing on value; d; the size of half baths and powder rooms is not demonstrated to be a relevant characteristic.

  1. The second most predominant fuel used to heat homes in the United States is
  2. bottled gas.
  3. electricity.
  4. fuel oil.
  5. natural gas.

Answer is B, electricity.

  1. The most common water heaters in use in the United States are:
  2. on demand water heaters
  3. tankless water heaters
  4. solar water heaters
  5. stored water heaters

Correct answer is D. “Stored water heaters are by far the most common.” This answer makes a, b and c incorrect.

  1. An Energy Efficient Mortgage (EEM)
  2. allows a borrower to qualify for more of a mortgage loan because of lowered utility costs.
  3. gives a buyer an additional tax credit for buying a green house.
  4. requires a buyer to finance energy improvements into a mortgage.
  5. uses the same debt to income ratios as regular mortgages.

Correct answer is A. “The two important parts of the program are that borrowers can finance energy improvements into a mortgage, and qualify for more of a mortgage loan because of lowered utility costs…” Improvements CAN be financed but are not REQUIRED to be financed.b is incorrect because tax credits are not part of a mortgage; c is incorrect, because the buyer could be buying a home which does not require additional energy improvements; d is incorrect, because it is the exact opposite of the correct answer (a).

  1. A HERS rating will
  2. be required for an EEM.
  3. be required for an FHA loan.
  4. have a positive impact on value, in all cases.
  5. make a house sell more quickly.

Correct answer is A. “EEMs require a home energy rating system (HERS) report.” B is incorrect because many FHA loans are not EEM; c is incorrect, because no data exists to prove that this would be true in all cases; d is incorrect because no data exists, or was brought into this discussion about how quickly houses sell.

  1. A MLS system has added searchable fields within the system to check for energy efficient features and energy certifications and ratings. This is
  2. a green MLS, and assists appraisers and agents in searching for green features.
  3. a guarantee that green homes will sell for more.
  4. of no interest to an appraiser.
  5. known as converting the MLS to a paperless (green) system.

Correct answer is A. “A green MLS system offers data entry fields to identify green features and certifications.” Although in some markets green homes have sold for more, there is no guarantee that a green home will sell for more in any particular market. A is correct. B is incorrect, because MLS systems do not guarantee that any property will sell for any price; they are simply a place where brokers offer cooperation and compensation to other brokers; the MLS provides all kinds of data of interest to an appraiser (which makes c incorrect). D. Green MLS describes the fields within the MLS; most MLS systems are paperless in that the data is online.

  1. Which of the following items would typically have the longest payback period to the homeowner?
  2. installing a programmable thermostat
  3. replacing an existing furnace with a ground source heat pump*
  4. replacing incandescent light bulbs with CFL bulbs
  5. upgrading the builder’s insulation package with a more extensive one

Correct answer is B. page Calculating cost and payback varies, depending upon what feature is being considered, the cost of energy where the house is located, and the climate. A variety of websites offer analysis of anticipated cost and return. Most residential buyers are more likely to do a simple pay back calculation by taking the cost of the item, and dividing it by the monthly or yearly savings to determine the payback.

The simple math for payback period is to divide the cost of the improvement by the savings per year (or month), which will then equal the payback period. For example, if a programmable thermostat costs $120 to install, but saves $240 per year, the payback period is under a year [$120 ÷ 12 = $10 per month (cost) ; $240 ÷ 12= $20 (savings) $120 ÷ $20 (cost divided by savings) = 6 months.

Because costs and payback periods vary, a useful site is: cost&payback

You can enter the zip code, size of house, etc. to determine energy savings. Obviously, common sense will also come into play. It is obvious that the more expensive the upgrade or retrofit, the longer the payback period. Programmable thermostats and CFL light bulbs have quick payback periods; extra insulation may often take years to recoup the cost, and of course, expensive heating systems, such as ground source heat pumps will take much longer to recoup.

  1. Which of the following is a proprietary rating system owned by USBGS?
  2. ICC
  3. LEED
  4. NAHB
  5. RESNET

Correct answer is BA. LEED; ICC is International Code Council; “This contrasts with LEED, which is a proprietary rating system owned by USBGS. C is incorrect because it is the National Association of Home Builders (a group, not a ratings system) and RESNET is incorrect, because as the text says: RESNET(Residential Energy Specialists Network: A group that performs ENERGY STAR ratings on homes and trains individuals to be RESNET raters.

  1. Which of the following HERS ratings would indicate the most energy efficient home?
  2. 100
  3. 80
  4. 50
  5. 70

Correct answer is B. 50 HERS ratings are the lower the number, the more efficient, so the lowest number here is 50; hence, most efficient.

  1. Which of the following ratings would probably be the easiest one for a structure to obtain?
  2. emerald NAHB
  3. gold LEED
  4. HERS ENERGY STAR 100
  5. platinum LEED

Correct answer is C. A HERS rating of 100 is a baseline house, platinum LEED chapter 3, page 8 “LEED Certification is considered to be the most difficult certification to attain.” Reasoning level question; student needs to recall that Platinum LEED is the highest level of LEED.Also as the 100 rating is a baseline, that indicates a “typical” home without energy upgrades.

  1. Which rating system rates houses, commercial, schools, and special purpose buildings?
  2. ICC
  3. LEED
  4. NAHB
  5. RESNET ENERGY STAR

Correct answer is B. Of the rating systems described, only LEED covers commercial, schools, etc. a is incorrect; ICC is a building code; c is incorrect; NAHB is an organization, not a rating system (they have their own rating system) d is incorrect as RESNET ENERGY STAR ratings are for residential properties only.

  1. Before trying to adjust for green features, an appraiser can
  2. back out the known adjustments, and make the adjustments for green features first.
  3. develop a cost approach and use that value as a target for the market value.
  4. develop a cap rate and an income approach to value first.
  5. make “known” adjustments based on the appraiser’s experience and judgment.

Correct answer is D. Discussed in Chapter 5, a is incorrect, because the sequence would be to first make known adjustments, then try to solve for unknown adjustments; b is incorrect because cost does not equal value; c is incorrect because a cap rate and income approach to value would typically be of little value for a single family home, and not an acceptable adjustment for what should be a market based adjustment.

  1. Making an adjustment by using a GRM requires
  2. assuming all the properties in the pool of comparables rent for the same monthly rent.
  3. having a pool of comparables with reliable data to develop a GRM.
  4. knowing GRMs are never appropriate for single family homes.
  5. using a GRM which will make the income approach to value be equal to the market approach to value.

Correct answer is B. a. is incorrect because the appraiser would verify the monthly rents before applying a GRM; c is incorrect because in some markets, GRMs are appropriate for single family homes; d is incorrect because this would be “backing into a value” by making the GRM fit the market approach.